What makes Bitcoin so popular in online gaming?
What’s Bitcoin All About?
Bitcoin or BTC is a digital currency, otherwise known as a cryptocurrency. It was created as a result of central bank failure in the 2007/2008 global financial crisis. The interesting thing about this digital currency is that open source code is used on a peer-to-peer system. No government or central bank anywhere in the world has authority over the supply of Bitcoin. It is not based on any physical commodities such as gold bullion, nor is it dependent on the performance of any country’s economy. The process of acquiring BTC requires a different approach to conventional fiat currencies. Bitcoin is mined, or is acquired from Bitcoin Exchanges, friends or family.
Why Bitcoin for Online Gaming?
There are many applications for Bitcoin usage, including payments for goods and services, and even online gaming. The reason for the explosive popularity of digital currency usage in online gaming circles is fourfold: anonymity, low or no fees, speed of transactions, and lack of regulation. Bitcoin gaming sites are popping up all over the place, and since they operate in a grey area, they are not subject to the same restrictive rules as conventional currency. The UIGEA (Unlawful Internet Gambling Enforcement Act) is a federal law that prohibits banks and financial institutions from transferring money to online gaming sites. Fortunately, individual states can decide how to determine their own online gaming regulations. Presently, 3 states in the US allow online gaming, including New Jersey, Delaware and Nevada.
But for the rest of the US and other countries around the world where restrictive regulation prevents real money online gaming, digital currency is the elixir. Bitcoin is revered as the #1 cryptocurrency since it was the original and remains the most popular. Online casinos and online poker rooms that are adopting Bitcoin as their preferred payment option are now able to accommodate players from across the United States, Europe, Asia, Latin America and Africa. Regulations do not apply to Bitcoin since it is not an official currency and is not governed by banks and financial institutions. This makes Bitcoin poker rooms the perfect gaming venue for all players restricted by their country’s gaming regulations.
Benefits of using Bitcoin for Transactions Processing
The rise to prominence of Bitcoin, and associated technology has been rapid and unprecedented. Many more BTC poker rooms are coming into being, and this brings with it myriad new possibilities for players. Now, it is entirely possible to play for real money without worrying about regulations. For example, online registration at BTC casinos does not require ID, personal information or your real email address. You can create an account with a nom de plume using a made up email address. This guarantees anonymity in your transactions. Further, all the high costs that players are subject to with regular transactions are absent. Fees and commissions are either absent or minimal when it comes to Bitcoin deposits and withdrawals. This is a sharp deviation from traditional payment options which can be quite expensive. More importantly, the time taken to process transactions with this digital currency is minimal. Deposits are typically available immediately and withdrawals are usually processed within a couple of hours.
But there are problems with this cryptocurrency, given that its usage is rather limited. Additionally, it currently has a low acceptance rate among vendors and poker rooms. Plus, there are other issues to contend with such as competing cryptocurrencies – Dogecoin, Litecoin etcetera. While these are certainly not as popular as Bitcoin, they remain a ‘threat’ at some level. With many digital currencies competing, online poker rooms may have to start using multiple payment options to accommodate players. And then of course there is the issue of interception of personal information. If there are flaws in the security protocols of an online poker room, it can be hacked. There are of course several other issues to contend with such as bureaucratic red tape for payments processing and the actual time taken to process transactions. The current limitation for BTC transactions is 7 per second – slow by anyone’s standards.