Will Regulated Online Casinos Ever Accept Bitcoin?

Many states and countries now offer legal and regulated online gaming markets. The licensed online casinos that serve these jurisdictions are completely legal.

Therefore, they don’t need to accept obscure banking options to serve players. Instead, these casinos take payments that come through mainstream banks, credit card networks, and e-wallets.

Bitcoin (BTC), however, is one payment option that regulated gaming sites don’t accept. This decentralized cryptocurrency remains relegated to offshore markets.

Will legal online casinos ever change their tune and start taking Bitcoin? I’ll answer this question by discussing more on Bitcoin’s offshore use, its advantages, and what’s keeping it out of regulated markets.

Offshore Casinos Are the Main Proponents of Bitcoin

An offshore casino operates in markets without obtaining United States licensing. It may or may not be operating illegally in these markets.

After all, some states and countries don’t have anti-online gambling laws in place. They simply haven’t regulated the activity yet.

Other governments do outlaw online gaming. Nevertheless, certain offshore casinos are still willing to serve these markets.

In either case, reputable payment processors and banks don’t like being involved with nonregulated gambling. Bank of America, Discover Card, and PayPal are examples of financial institutions/services that steer clear of gray markets.

Many banks that issue Mastercard- and Visa-branded cards block deposits that players make at offshore sites. They may reject nearly 50% of casino deposits in such cases.

Here’s where Bitcoin comes into the equation. BTC is decentralized, meaning it’s not subject to control by any third-party entity.

A bank can’t step in and reject a Bitcoin casino deposit. Gamblers can use BTC freely without any fear of seeing their deposits blocked.

With that said, Bitcoin represents the perfect banking option for a majority of offshore gaming sites. Casinos that use Bitcoin can more easily serve their customers thanks to this cryptocurrency.

Advantages That Bitcoin Offers Online Casinos

Offshore casinos love BTC for a variety of reasons. Below, you can see the main advantages that this cryptocurrency provides gaming sites.

Decentralized Banking

Financial institutions are centralized by nature. They must adhere to their local government’s laws along with international banking standards, too.

Furthermore, they exercise control over their customers’ transactions. If PayPal wants to block a transaction, for example, then they can easily do so.

With that said, the average financial institution is centralized. A small group holds control over the network and how customers spend money.

BTC ensures that gamblers don’t need to deal with a centralized entity. Instead, it’s a completely decentralized payment method that doesn’t give any single party control.

Few/No Laws Surrounding BTC

National governments instate banking laws for multiple reasons. They want to protect consumers and monitor transactions for potentially illegal activities (e.g. money laundering).

Governments aren’t inherently bad for regulating financial institutions within their reach. However, their efforts can infringe upon people’s rights, too.

Many people believe that they should be able to gamble online if desired. They want to quickly make deposits and play online casino games without hassles.

Bitcoin provides a hassle-free path towards real money online gambling. Most governments around the world have little, if any, regulation surrounding BTC.

Relatively Low Fees

Offshore casinos have promoted Bitcoin deposits because this cryptocurrency doesn’t normally involve big fees. Case in point, somebody once moved over $1 billion worth of BTC for less than $5 in fees.

Of course, the average person isn’t moving $1,000—let alone $1 billion. Therefore, they deal with even lower fees. Both casinos and players benefit from these low transaction costs.

Casinos that eat gamblers’ deposit fees for credit card transactions love that they don’t need to pay fees at all with BTC. Players, meanwhile, usually only pay $1 to $2 to place Bitcoin deposits.

Why Don’t Regulated Online Casinos Accept Bitcoin

You can see why BTC is attractive to offshore gaming sites. So, why don’t regulated online casinos take advantage of the same perks? You can see what’s holding regulated sites back from Bitcoin below.

Already Enjoy Mainstream Banking Options

Most banks and payment processors are willing to facilitate online gambling transaction in regulated markets. Given the clearly legal status of online gambling in these jurisdictions, financial institutions aren’t bothered by serving them.

With that said, casinos in such markets don’t need to seek out alternative banking options like Bitcoin. They already enjoy access to the most-prominent brands.

Here are examples of institutions that serve regulated US states:

• Visa
• Mastercard
• Discover Card
• American Express
• Neteller
• PayPal
• Skrill
• Most banks (ACH, wire)
• PayNearMe (CVS, 7-Eleven)

Many people know and trust these names. Therefore, regulated gaming sites don’t see the need to add BTC to the mix.

BTC Not Well Received By General Public

Bitcoin has gained more mainstream acceptance in recent years. It has come a long way from being known primarily as a tool for money laundering and other crimes.

Nevertheless, BTC still has a long journey towards gaining the same clout as trusted financial institutions. The average person doesn’t have the same confidence in Bitcoin as, say, Visa.

Of course, this perception should continue changing over time as people realize that BTC is a legitimate payment method. But regulated casinos aren’t taking any chances with their reputations until then.

Local Regulator May Have Issues

In the US, state politicians decide whether to legalize online gaming in their jurisdictions. Delaware, Michigan, New Jersey, Pennsylvania, and West Virginia have all chosen to regulate online gambling.

Politicians always have reservations about approving online gambling. Most aren’t keen on casinos accepting anything as controversial as BTC at this point.

Lawmakers, like the general public, will probably change their tune on the matter as well. For now, though, gaming sites don’t even want to bring up the issue of Bitcoin banking.

What Will It Take for Legal Online Casinos to Accept BTC?

Regulated internet casinos don’t look to take Bitcoin anytime soon. However, this situation could change if the following conditions happen.

More Mainstream Adoption

Again, Bitcoin has been gaining mainstream fame in recent years. However, BTC’s fame comes from its investment potential rather than utility.

The average person isn’t choosing Bitcoin over Visa or PayPal for purchases. Likewise, businesses aren’t going out of their way to add this cryptocurrency as a payment option.

That said, legal online casinos don’t view BTC deposits as imperative. They want to see more true adoption before feeling the need to accept Bitcoin.

Better Public Perception

Bitcoin’s history is riddled with criminals using it for drug purchases and money laundering. Many people still relate BTC to the dark web because of the now-defunct Silk Road.

Some attitudes regarding this virtual coin have switched to its investment potential. Almost all BTC-related news revolves around its price changes rather than payment adoption.

The investment obsession isn’t helping sell Bitcoin’s merits either. This crypto is more volatile on a day-to-day basis than most stocks.

Regulated online casinos will want to see more changing attitudes towards Bitcoin before caring about it. Specifically, they’ll want BTC to become a legitimate payment method with a solid reputation.

Casinos Convincing Regulators to Allow BTC Payments

Regulated gaming sites aren’t going to roll out Bitcoin deposits with no questions asked. Instead, they’ll need to obtain approval from state regulators.

For example, New Jersey online casinos must petition the state’s Division of Gaming Enforcement for new changes to the market.

Gaming sites currently have a tough sell on their hands in convincing regulators that Bitcoin should be an accepted payment option. They’ll probably need to wait a few years before running this subject by the local online gambling governing body.

Conclusion

Bitcoin remains a very important banking option to offshore casinos. The latter heavily leans on BTC to serve players in gray markets.

However, BTC doesn’t appear close to adoption in regulated jurisdictions. It doesn’t have the adoption, reputation, or regulatory acceptance to penetrate legal markets yet.

But I see this situation changing in five to 10 years if Bitcoin continues on its current trajectory. BTC has come quite far in just over a decade of existence. It should continue advancing in terms of adoption and acceptance over the next decade.