Bitcoin Usage Highest among Gamblers
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Recently, a high roller who plays under the screen name “Mechs” placed enormous bitcoin bets at Just Dice, a bitcoin gambling service, and lost as much as $800,000. Just-Dice.com has processed bitcoin wagers worth over $2 billion ever since its launch in June 2013. At bitcoin gambling sites, depositing, wagering, and withdrawing takes place in an unregulated digital currency that does not have a physical existence—bitcoin, and most gambling officials are hardly aware of it.
Bitcoin Mostly Used for Gambling
It has been widely estimated that around 60 percent of international bitcoin transactions are related to gambling. After its birth in 2009, the cryptocurrency has grown so fast that regulators have just realized its existence and the need to regulate it.
Senator Tom Carper, who had chaired the Homeland Security Committee’s hearing on digital currencies last November, admitted that he had heard about the existence of bitcoin just six months back because of his teenage son’s habit of playing World of Warcraft.
Why Gamblers Love Bitcoin
The advantages of using bitcoins for gambling are many, and here are three of them:
1. Low transaction costs
Gamblers and operators alike do not have to spend a lot in sending and receiving bitcoins. To make things better, a bitcoin transaction cannot be reversed. Once bitcoins are sent, they remain sent. Gambling operators love this because it eliminates all chargeback fraud risks.
Bryan Micon, who chairs SealsWithClubs.eu, a bitcoin poker site, considers this to be a boon. According to Micon, SealsWithClubs.eu has processed over 20,000 transactions after it launched two-and-a-half years back, but has paid transaction fees of only $20. Since transaction costs are minimized, the house edge is very low at bitcoin gambling sites. Eric Vorhees, founder of Satoshidice.com, which has a house edge of only 1.9 percent, said: “A Vegas casino game might have a house edge of 10 percent. This means that if you’re going to gamble, it’s far smarter to play Satoshidice.com than a Vegas Casino.”
2. Transactions are both anonymous and transparent
The most exciting thing about bitcoin gambling is that the transactions are anonymous as well as transparent at the same time. Each transaction is carefully recorded in the Bitcoin block chain, but the personal details of the parties involved are not revealed. This transparency allows players to make sure that gambling is indeed fair at Bitcoin gambling sites. Vorhees calls it “revolutionary,” something that cannot be seen at any Las Vegas casino.
3. Instantaneous
Gamblers might still be worried that bitcoin gambling sites might steal their bitcoins, but this hardly happens as bitcoin transactions are instantaneous. Gambling operators are also happy about the instantaneous nature of bitcoin transactions because they need not hold their players’ winnings for long, making it easier for them to dodge gambling laws such as the UIGEA of 2006.
