U.S. regulators have kept the cryptocurrency involvement in the gaming community on the back burner for quite some time. (photo by Flickr)
U.S. regulators have kept the cryptocurrency involvement in the gaming community on the back burner for quite some time. However, according to U.S. gaming law attorney Jeff Ifrah, that may change in the foreseeable future.
ďThereís no prohibition thatís written into the law, itís just that the regulators have not approved it as an alternative form of paymentĒ Jeff said.
He goes on to state that licensing is required and it can be set state-by-state. If you were thinking that if itís not against the law, then why not just go for it? That decision could be more costly than one might imagine. Taking on an unlicensed vendor by a gaming entity could result in the complete loss of their operator license and shut them down.
Any business associated with iGaming is required to have a supplier or vendor registration to provide services such as payment processing. According to Jeff, the regulators must be sure that there is complete transparency to see who all is involved or engaged with the online sports bet or casino. This is a task that has yet to be addressed in making the decision towards crypto. This could be due to a lack of understanding the benefits of crypto by regulators.
Since crypto resides on the blockchain, all data with regards to gaming transactions would also be stored. This gives regulators an immutable record that is certainly transparent. Additionally, sharing KYC information on Blockchain would enable financial institutions to deliver better compliance outcomes, increase efficiency, and improve overall customer experience.
Regulators have the sole authority to establish cryptocurrencies as acceptable methods of payment on the blockchain. They basically control licensing for all payment with regards to online gaming as well as brick and mortar casinos. They have yet to get existing institutions such as Visa, Mastercard and PayPal to an infallible level. Taking on crypto payments would likely compound existing monetary payment problems. Adding another log to the fire may be a bit too much at this stage.
The entire U.S. gaming community is waiting in anticipation for regulators to jump onboard the cryptocurrency express. Once they do decide to tackle this challenge, the positive result may be greater than expected.