Social Casino and Cryptocurrency Not a Match, Says KamaGames

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While cryptocurrencies are taking the online gambling industry by storm, they are reportedly not as successful in the world of social casinos. Back in August of 2018, we reported on the social casino operator KamaGames taking interest in using cryptocurrency in its app. Fast forward to this month, though, and the operator’s bold idea has already been proven to be an unsuccessful one, given the very nature of social casinos.

Cryptocurrency Adoption “Disappointing”

As reported by Venture Beat, KamaGames’ foray into the cryptocurrency space proved to be a disappointment, only months after the idea was conceived, according to Andrey Kuznetsov, the CEO of the KamaGames Company. In a new interview with the magazine, Kuznetsov explains that the cryptocurrency test the company ran for a few months proved to be only a hassle and a “letdown” considering the bold predictions of market watchers that gaming apps would be a major drive for the cryptocurrency space.

Like all social casino apps, KamaGames’ apps weren’t really licensed gambling sites like online cryptocurrency casinos where real money wagers are placed. Instead, they are “social” platforms where users play with virtual currency, chat to each other, and earn level-ups and rewards.  Each users starts with a certain amount of virtual funds they can grow by playing social casino games. And when in need of more funds, players can use real money to buy in-game currency that cannot be withdrawn back.

KamaGames had the idea last year to make possible for in-game currency to be purchased with their own cryptocurrency tokens based on the Ethereum blockchain. The tokens were supposed to be sold in bulk as in-game chips for the best price possible. They were also expected to grow in value day to day. But while initial research showed users were interested in getting the tokens, the actual demand turned out to be even lower than the most pessimistic of projections.

Price Drops, Complexity, and Profit-Seeking to Blame

As explained by Kuznetsov, there are multiple reasons why cryptocurrency tokens proved to be an unsuccessful idea for the company. For starters, cryptocurrency price crashes have made people wary of buying tokens. Secondly, the whole concept of a social casino is to provide users with a simple and fast way to enjoy casino games, something which the addition of cryptocurrencies complicated.

Reportedly, KamaGames needed around 1.5 million transactions, which weren’t possible on any existing blockchain. There was also the issue of users losing hours with customer support to learn how to use tokens. And finally, there was the problem of people buying the tokens only to sell them later when they are listed on exchanges, which KamaGames had no intention to do due to the very nature of the company and the need of additional licenses.

On the other hand of the spectrum, players at licensed cryptocurrency casinos online have no problem to use coins to gamble. That’s because cryptocurrency casinos were purposefully created to provide users with the benefits of digital assets in a regulated and fair gambling environment. As opposed to social casinos, where users don’t have much interest in privacy or making money but simply need a quick access to fun games that will help them kill some time.