Cryptocurrency is a better choice for online betting on future events and sports. Popular fantasy sports betting platforms like DraftKings and FanDuel should consider Bitcoin’s lower transaction fees and quicker settlements, particularly after a major payout processor pulled its services, leaving these two companies high and dry.
Betting Made Better with Bitcoin
Online gambling grew into a $41 billion USD industry in 2015 and is set to grow even more in the coming year. Sports betting in the US alone is said to be four times that size, and most of this betting is deemed illegal.
Just recently, Vantiv Entertainment Solutions, a payment processing service said that it would “suspend all processing for payment transactions” with its clients FanDuel and DraftKings this February. Both of these companies are very popular fantasy sports services that enable users to bet on the fantasy teams they create. The share of total payments processed by Vantiv is unknown, however, for the two platforms, which control over 90% of the daily fantasy sports market.
Gambling and digital currency could make quite a splash in the betting arena and also have a Backpage Effect on the industry. Bitcoin is something these businesses should look into as it is a payment rail that operates 24/7 with no central party and will never freeze a company’s operations. Using the virtual currency also gets rid of the need to leave personal information like banking and credit card info.
The traditional ways of operating with today’s online gambling usually involve the cumbersome task of using a wire transfer with a significant fee or leaving credit card and banking information with a third party. This kind of structure leaves your information susceptible to compromise. Some services work with Paypal and other third-party payment processors to handle the funds. This is a very centralized massive point of failure for any high stakes betting site, and they can also cut their support as demonstrated as well.
Services that allow betting on the upcoming Super Bowl, for example, or basketball and baseball, are available online and use digital currency. A recent article featured on MarketWatch gave a good example to how someone can bet on sports or the US presidential election odds. The author of the article detailed how he placed a $1 bet on the vote outcome of the Iowa caucuses.
“I was able to do it so simply by using bitcoins, the new ‘cybercurrency,’ and the Internet,” he writes. “It did not require any great technical know-how. It did not require any information beyond what I could learn via Google. And if I had wanted, I could have kept the entire process anonymous, to the point where an army of G-men couldn’t have caught me even if they had tried.”
The process was simple as the writer had purchased a Bitcoin voucher from LibertyX in Boston’s Chinatown and placed the bet with an online bookmaker. This shows the versatility of the virtual money’s ability to bypass restrictive laws that differ between borders. For instance, sports betting in the U.S. is only allowed in Delaware, Nevada, Montana, and Oregon. Still, nearly every state has lotteries and casinos.
Quite a few people would agree that many of these so-called “crimes” are victimless, to say the least. A digital currency without borders would enable consenting adults to gamble if they choose to do so from the privacy of their own home. Bitcoin can help online betting services like DraftKings reduce their dependency for third party processors. With its lower fees, instant settlement and true peer-to-peer nature, cryptocurrency could be the perfect solution for the billion-dollar betting industry worldwide.
Do you think gambling and Bitcoin are a great match? Let us know in the comments below.
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