Why does the bitcoin gambling grow?
It goes without saying that online gambling is becoming more popular every year. Online casinos are no longer spending their marketing budgets strictly online, but also they are going for more traditional and pricy channels, like TV, radio and outdoor ads. Online betting houses are sponsoring quite a few sports team already and the number keeps on growing. However, over the course of the last few years we have seen an establishment and a rapid growth of one particular niche – bitcoin gambling. Let us consider the main reasons for its current growth and forecast whether the growth will sustain.
Many regulators have not taken any action regarding the bitcoins. Not only in terms of gambling, but in general. This has led to quite a relaxed operating environment in the bitcoin gambling industry – the casinos were operating in the gray area. What does it mean? These casinos were not unregulated, they simply could not apply for the license at all.
However, bitcoins have been receiving more attention from different governments. Already in September 2015, Commodities Futures Trading Commission (CFTC) has announced that it sees the Bitcoin as a commodity. Around the same time, European authorities has made bitcoins more legal too, yet the EU regulators see it as a currency.
This has led to a shift in the gambling regulation. In August 2016, United Kingdom Gambling Commission (UKGC) has announced that it considers bitcoins to be an equivalent to any other currency. This way the organization became open towards licensing bitcoin-only casinos. Clearly, it was quite easy for the bitcoin gambling portals to grow fast in the past due to the lack of the regulation, however, UKGC licenses should help sustaining the growth in the future.
The bitcoin market itself
When taking a look at the bitcoin chart over the time frame of the last five years, it becomes clear that the bitcoin is a very volatile asset. The lowest possible price of 1 BTC was around $1373 USD. The highest bitcoin’s price was $40,000 USD. Hence, some of the bitcoin owners could actually triple their savings in the fiat currency simply by converting those to bitcoins and converting back when the price became higher. Some people are, of course, less fortunate and they actually lose money due to the volatility. Well, the only thing that is certain here is that the users of the bitcoin are the risk seekers and gambling is something they are more likely to adopt. Hence, such a targeting will definitely be a major contributor to the growth in the bitcoin gambling popularity in the future.
Difficulties with cashing out
Even though a total market cap of the bitcoin market is over 15 billion USD and its daily turnover is close to 160 million USD, it is still not so easy to convert your bitcoins into cash, especially in some countries. Historically, the bitcoins were used for some shady transactions and this is why the government authorities have been keeping an eye on the banking transactions to and from the bitcoin exchanges.
In some countries, one would simply have to pay high taxes on the gains generated from the bitcoin’s rate. As a result, the owners of bitcoins simply prefer to spend bitcoins then convert those into USD or any other currency. One of the possible ways to spend the bitcoins is, obviously, to gamble with them online. Yet this is the least contributing factor towards the future’s growth of the bitcoin gambling, as sooner or later the bitcoin will get so common that it with just be in line with the fiat currencies.