Bitcoin Gambling: An Overview of an Emerging Multimillion Dollar Industry

[Imperator]

No longer the domain of early Bitcoin adopters with web development backgrounds, Bitcoin gambling has exploded into a multimillion dollar online industry. Inhabiting the dicey space of opportunity between lagging legal frameworks and the unprecedented functionality the Bitcoin protocol enables for these platforms, online Bitcoin casinos are growing in numbers, total Bitcoin profits and Bitcoin turnover.

http://bitcoinmagazine.com/6966/bitc...ling-overview/

[universal4]

The US governemnt doesn't exactly care for online gambling and they care even less for Bitcoin, since even when they do get around to regulating the industry they do NOT like not being able to regulate currencies such as Bitcoin due to the currency being extremly attractive to those wanting to launder money and we know how much they hate citizens staying anonymous when it comes to financial transactions.

http://www.usatoday.com/story/news/p...tions/2702653/

I guess we shouldn't be surprised that New York would be one of the first states to issue subpoenas.


Rick
Universal4

[RowanAdams]

Yeah bitcoin casino are getting numbers each days, the battle of this online casino is depending on their pay-outs, transaction processed and the responsible gaming.

@universal24 Very well said, they are always very strict when it comes to privacy, in some case or I mean in some article I've read does the US are scared because bitcoins have this potential to get a higher value done USD.

[universal4]

No, I do NOT think the US Governemnt is scared that Bitcoins will gain a higher value since they could really care less.

What they are concerned about is that there is no way to either track any and all payments made by Bitcoins, and they have no way of taxing said revenues no matter what industry they are used for.

Also, if Bitcoins were to suddenly collapse, anyone and everyone that had any funds tied up in to the currency would be out of luck and lose what funds they put up to buy the bitcoins.

It may be that some day in the future this could be an acceptable form of currency, but widespread acceptance in my opinon will not be fast in coming for a number of reasons.

First, the worth of a bitcoin is compared against how many dollars, pounds or euros they cost. the value is not compared to how many gallons of gas or how many groceries in their cart at walmart they will be able to purchase for said bitcoin. And in my opnion until that changes, or until i can use a bitcoin to make said grovery or gas purchases, I do not see it as gaining a lot of widespread use or acceptance.

Rick
Universal4

[Imperator]

First, the worth of a bitcoin is compared against how many dollars, pounds or euros they cost. the value is not compared to how many gallons of gas or how many groceries in their cart at walmart they will be able to purchase for said bitcoin. And in my opnion until that changes, or until i can use a bitcoin to make said grovery or gas purchases, I do not see it as gaining a lot of widespread use or acceptance.

Rick
Universal4

This can be said for any currency. Take Canadian Dollars and go to France. You won't be able to buy a cup of coffee or a gallon of gas until you convert to the local currency. Take Euro and go to the States, people will laugh at them when you try to pay something. Bitcoins are similar. They can be considered a global currency, and in order to use them locally - convert them to the local one

Taxing bitcoins is not an issue. Governments can tax the exits - the exchanges and businesses that operate using bitcoins. Money laundering is trackable too as every single transaction is public. Yes it might not come as fast as we wish (or some don't), but it will definitely come, and the ones which were early in this eco-system will have leverage. http://www.businessweek.com/articles...ia-grips-china

[universal4]

Ahhh but Bitcoin is NOT backed by anyone, so it is just air.

And we are not talking about a currency that is legal tender and can be used for goods and services by the average person anywhere.

This may of course change, I just do not see it happening as fast as, or anywhere near as smooth as those pitching Bitcoin Casinos want everyone to believe. (if at all)

Rick
Universal4

[Imperator]

Actually it is already legal in Germany and will soon be legal in the States and UK. In the States, a US Federal Judge confirmed in a federal court case that bitcoin is a currency. But yes, it is not smooth and if it becomes 100% legal, the bitcoin casinos might not have too bright of a future, as then they will need to operate under the same gambling laws as everyone else.

[universal4]

And "if" that would happen, the value of Bitcoins would plummet overnight. They would likely lose more value in days than they have gained in the last year or so.

And no one compares their country's currency to how many bitcoins it is worth, bitcoin's value is tied in to what they can sell them for in a currency they can actually spend such as dollars or euros etc.

Rick
Universal4

[Doolally]

The bit that always gets me, when we're on the subject of Bitcoin investments, is why would anyone in their right minds invest $$Thousands in a completely unregulated currency market?

Genuinely interested in replies for those with more experience than me because at the moment, it's all too risky for me to think anyone could take it seriously and invest any clean money into.

The trouble is, the first money Bitcoin laundering / fraudulent activity case to come to court could send 'investors' into panic mode and the value of bitcoins will be wiped overnight.

[edgarf76]

The whole concept of the bitcoins makes me uneasy. It is not taxed yet as the article states which is a huge problem for the US. Another good point that was made was what if they were to collapse?

Think about what would happen if shady stock brokers (who owned them) started pitching these investments to clients and drove up the price and then dumped them. It is worse then penny stocks, it would be taking the life savings from people just like what happened in the late 90s.

I would not touch these things, and if I wanted to touch them I couldn't because they do not exist.

[Moonsun2]

I don't know much about Bitcoin, so I appreciate this information.

Best wishes for success!

[Moonsun2]

I do share your concern Rick. It would be interesting to know other people's feedback on this topic, in order to feel more secure.

Julie

[Imperator]

The trouble is, the first money Bitcoin laundering / fraudulent activity case to come to court could send 'investors' into panic mode and the value of bitcoins will be wiped overnight.

It actually already happened, and might have had the reverse effect. http://forexmagnates.com/largest-bit...t40-for-fraud/

This is the case where a Federal Judge took a stance that it is a currency afterwards. The value was ~ $80/btc at the time. Now it is $125/btc. However, the price jump might or might not be related to this and we will most likely never know.

[LukeC]

Does your company hold a significant portion of its bank balance in Bitcoins rather than a traditional hard currency? I think that would show a true level of confidence in the currency.

[TheGooner]

Just one mans view.

I'm 50/50 about BitCoin. It's interesting as to how there are a limited number of possible bitcoins, and the mechanism for discovering (or mining) new bitcoins is very elegant. The idea of a virtual currency or credit has been the stuff of sci-fi literature, and there have been a few attempts before bitcoin came along. The fact that bitcoin has survived so far is a testament to the robust and secure structure.

In some ways, BitCoin could be compared to gold bullion. They are both very abstract storages of wealth, and although there are some industrial and cosmetic applications for gold the reality is that it's perceived value has little to do with what you can do with it. Instead it is scarcity and desirability that determines the price of gold, and also bitcoin.

No-one backs gold. No-one backs BitCoin.

Where gold scores more highly is that it has a history of 2,500+ years, it was used for "money" is pre-industrial times, it has a huge base of commercial and individual investors, and there is a quantifiable scarcity and a known cost in extracting gold that helps to underpin a base value ... as long as we all keep agreeing that gold is desirable.

What BitCoin needs to do to become a virtual standard alongside gold is to come out of the shadows. Currently a significant proportion of the transactions using BitCoin are for illegal transactional purposes - be via it SilkRoad or just US citizens gambling online in defiance of US Government restrictions. That is not going to make it a viable "store of wealth" for most individuals.

I have some wealth. I have cash, I have multiple currencies. I have stocks, shares, bonds, real estate and even some bullion.
I have art and wine and some antiques and nice cars (all probably not A+ investment grade - but with some value)

But while I am very computer literate - and I work in the virtual world - BitCoin still misses the mark for me. It's "dodgy".
And if I don't own or even want to own a few BitCoins then it has a lot of work to do.

[edgarf76]

you made very valid points. However US currency used to be backed by gold until the 1970's. Also Gold can be used for Jewelry which makes the demand higher and more desirable. Just my two cents.

[Fastlane]

I'm optimistic about bitcoin when it comes to online gambling for several reasons, but primarily: Almost instant deposits and withdrawals, plus very low rake for poker and good odds for casino and sports.

Here is another article discussing the potential of bitcoin in online gambling:

http://www.bitcoincasino.org/blog/bi...nline-gambling

[Imperator]

Does your company hold a significant portion of its bank balance in Bitcoins rather than a traditional hard currency? I think that would show a true level of confidence in the currency.

It does, yes.

[benji]

Investing in bitcoins are a risk like any investment in any currency. The same as gambling, you're always going to have winners and losers. However, I still think its a lower risk at this point due to the fact its not been widely adopted yet but the difficulty of mining is increasing at a rapid pace which increases the value of bitcoins. Litecoin is another alternative which I think will see the same sort of boom bitcoin did this year in 2014.

I think cryptocurrencies have a massive part to play in the future of online gambling.

[Virtual Marketing]

Does anyone have any more doubts about the BTC and our industry ?