The iGaming industry is characterised by its rapid growth and tech-savvy platforms. The global online gaming market is forecast to grow to £160bn by 2026. Naturally, it’s positioned to seize the opportunity that modern technologies present.
One of the most promising solutions that have the potential to bridge the gap between legal and illegal iGaming markets lies in blockchain technology. By leveraging blockchain to drive new experiences across platforms, the industry is set to advance even further.
In this blog, we’ll be covering the role blockchain technology is poised to play in the iGaming industry.
- What is blockchain?
- Blockchain and its role in iGaming
- Player Protection and Responsible Gaming
- Enhanced safety and security
- Transparency and provable fairness
- Speeding up transactions at minimal fees
- Privacy and anonymity
- Better odds and return to player
- Easier auditing process for regulators
Let’s go back to the basics, what is blockchain?
Blockchain can be simply defined as a decentralised, shared, immutable ledger that facilitates the process of recording transactions. In plain English? It’s a record that is immediately accessible, accurate, transparent, and can’t be tampered with.
Blockchain and its role in iGaming
You might be wondering, what benefits can blockchain bring to the iGaming world? Isn’t that just another word for cryptocurrencies? Although common perception has blockchain limited to cryptocurrencies and crypto exchanges, blockchain technology goes far beyond that narrow definition.
Although iGaming boasts an enviable market potential, the sector continues to face issues of fairness and trust. Calculation of odds, protection and payment of monetary stakes, slow settlement rates and high fees, data protection and digital security are just a few of the concerns inherent to online casinos.
Now that we’ve established some of the factors that threaten the long-term viability of the industry, what role does blockchain serve?
Player Protection and Responsible Gaming
Blockchain technology has the capabilities to vastly improve a range of industries. It hosts a range of advantages that is especially useful to the iGaming industry. Perhaps most notably, adoption would greatly benefit operators, regulators and players alike.
Player Protection, Safer Gambling and Responsible Gaming are at the focus of the industry. Operators are being fined enormous amounts due to AML and KYC infringements, while carelessly encouraging at-risk players to wager bets.
Integrating blockchain technology, such as Kensei, on iGaming platforms, works to alleviate the issues mentioned above, without affecting the processes in place. Simultaneously, by establishing transparency and credibility as core components, such offerings enhance the industry’s reputation. Kensei, together with our partners, Crucial Compliance and W2, deliver a holistic solution for Player Protection and Responsible Gaming.
The main benefits of using blockchain include:
1. Enhanced safety and security
Security is becoming increasingly important across all sectors, and iGaming is no different. A major benefit that blockchain technology offers the iGaming industry is enhanced safety and security. With millions of people around the world entrusting their personal and payment details to organisations, smart contracts are designed to ensure that cybercriminals can’t access any data. It’s very difficult to intercept information because of the way chains are linked. This additional security feature goes a long way in terms of operators reassuring their players that their data is in safe hands.
2. Transparency and provable fairness
Operators know the importance of proving fairness both to their players and regulatory bodies. One of the biggest challenges facing every iGaming business is the question of trust. Blockchain resolves this by demonstrating a detailed, immutable account of all played games, staked bets and accounts, which is accessible via a public ledger. The very nature of blockchain is trustless with no central authority controlling the system, leaving no room for manipulation and the data retains its’ integrity. Fairness is guaranteed by smart contracts and their underlying logic with every bet becoming subject to digital agreements, making it impervious to fraud.
3. Speeding up transactions at minimal fees
When it comes to sports betting, slow transactions times could result in a missed bet or specific odds. Players shouldn’t have to wait more than a few seconds for a webpage to load, or for a transaction to be processed. Blockchain makes this possible. The ability to gamble with crypto solves many issues associated with using traditional currencies. The use of crypto enables cheap transactions that are performed at faster speeds. As blockchain transactions aren’t dependent on banks, the costs of withdrawals and deposits are much lower than with any FIAT currency.
4. Privacy and anonymity
iGaming and gambling are legal in many parts of the world, and more countries are moving towards legalising them. Yet, most players want complete anonymity and expect confidentiality around their gambling activities. A transaction on the blockchain is marked by an untraceable digital footprint, users are identified by keys rather than names. All deals and interactions on blockchain technology are publicly available, with identities masked by a string of numbers and characters, providing the ultimate privacy.
5. Better odds and return to player
The saying goes ‘the house always wins. In traditional betting, the profit is predetermined and subtracted from every wager that the players make. This means, regardless of the result, the house is guaranteed a profit. With two of the main features of blockchain technology being decentralisation and peer-to-peer transactions, the need for a middleman is removed. Why is this significant? This increases the odds, as well as the amount of the total bet. How is this possible? With smart contracts acting as an agreement among the players only.
6. Easier auditing processes for regulators
Platform integrations such as Kensei aim to serve both operators and regulators in the iGaming sphere. Simplifying the process for those who need to perform all the checks and balances is a win-win for both sides. Blockchain was designed to be able to self govern its own network. A key feature we mentioned earlier in the article, immutability, guarantees that the data can not be altered once it’s added to the blockchain, which means that operators can’t cover anything up.
The industry is starting to realise the benefits of using blockchain in its day-to-day operations. Transparency alone would eliminate several trust-related issues associated with iGaming operations. The characteristics mentioned above represent solutions to the intrinsic problems within the industry. Kensei was created to be seamlessly integrated into existing systems and remove the complexity of data integrity. IGaming is an ideal use case for our product.
It’s a safe assumption to say that deploying blockchain solutions in iGaming will shape the future of the industry, while also driving the adoption of the technology. With Kensei, we’re pioneering the future and harnessing the technologies’ potential to make it accessible in the now.
The question is do you want to be ahead of the curve?
If the answer is yes, get in touch with one of our experts to discover how nChain can help.