How Online Bitcoin Casinos Are Raising the Bar in Developing Software Algorithms
Online gambling has long been an industry with a number of challenges and opportunities for both casino operators and players. Oftentimes, players are concerned with major issues with the fairness of games and the trustworthiness of payment gateways.
Now, bitcoin casinos are raising the bar for the gaming industry. As software developers continue to develop new algorithms that test the fairness of games, we are seeing new opportunities that benefit the creation of new casino businesses all while attracting new players from around the globe.
Early Origins of Fair Gaming
While the rise of bitcoin casinos has only started in the last couple of years, the technology implemented in these games has been in the works for several decades. For example, similar to any video game, random number generator (RNG) technology provides the foundation for bitcoin gambling. Even when we consider old-school video games like Pong, for example, RNG has played an integral role in preventing predictability of how a game functions. Even more importantly, RNG ensures that the outcome is not rigged for either side.
Today, slots, table games, card games, and more all rely upon RNG as one way to ensure fairness. While RNG is essential for any randomized game to have, people also want to be able to check for themselves whether a particular game is fair or not. Just a few years ago, there wasn’t a good way to prove that a game was, in fact, using RNG. As a result, a large number of casinos have been reported to run rigged games. However, in recent years, we have seen a lot of progress in the creation of provably fair algorithms that take the verification of game fairness to a new level.
Provably Fair Algorithms of Today: Transparent Gambling for All
When searching for any bitcoin casino game online, it’s essential to look for the term “provably fair”. While designing a game to be provably fair can be quite complex and definitions of fairness (i.e. exact percentage chance of winning) can vary, there are a few general principles for understanding how provably fair algorithm generally work. Here is a summary of a basic explanation from bitcoincasino.us on how any player can check to see whether a bitcoin casino is using a provably fair algorithm.
First, games are typically certified to be provably fair by a well-known, independent organization that runs a random number generator (RNG) to come up with a result.
Next, after a random number is generated, it is then “hashed” with a secret number also created by the algorithm. After the random number and secret number have been hashed, the result is known as a “fingerprint” because it is unique and can’t be duplicated ever again. Players can even select a “seed” number between 0 and 9.
All of this is handled in a blink of an eye, and the contributing factors are displayed with transparency. Finally, players can either choose a third-party tool or widget offered by sites like bitcoincasino.us to ensure that the algorithm is functioning properly.
Bitcoin Gambling Vs. Traditional Online Casinos
In most cases, these new algorithms bring tangible benefits to players. For example, according to casino.org, bitcoin casinos offer 1-2% lower house edges when compared to traditional online casinos. Additionally, the use of cryptocurrencies instead of fiat currency means that players can pay to place bets and also receive winnings more quickly. Some bitcoin casinos even offer the option to deposit, withdraw, and play in complete anonymity.
All of these benefits create a better online gambling ecosystem for players also means that user adoption of bitcoin casinos is likely to increase. As players are able to verify the fairness of these games through a variety of means (i.e. open-source code, player reviews, etc.), we are beginning to see the adoption of more “trustless” systems that utilize technology to prove that games aren’t being rigged.
Additionally, by using cryptocurrencies instead of traditional fiat payment methods, bitcoin casinos are often able to payout winnings instantaneously vs. having to make players wait days or weeks on banks to process ACH or SWIFT transfers. For both bitcoin casinos and players, this creates less friction while also reducing traditionally high payment processing fees. While BTC is one payment option for bitcoin gambling, there are other gaming-specific cryptocurrencies like FunFair that are looking to compete in this space.
Decentralization of Gambling: Fueling Opportunities for Industry Expansion
The issues that have traditionally plagued the adoption of many online casinos are now being solved by RNG and provably fair algorithms. Instead of having a few companies dominate the space as we have seen in the past, innovation makes it possible for new casinos to emerge and gain a greater share of this industry’s growth.
Essentially, online gambling is becoming more and more decentralized. While some limitations (i.e. geographic restrictions) do still create challenges to adoption, we are seeing new opportunities not only for those that host blockchain-based casinos but also for those developing the games. For example, many bitcoin casinos offer the option for developers to launch their own decentralized applications (dapps) and market towards existing users.
This is all part of a larger trend of a growing online gambling market that has continued to become more profitable over time. For example, the market is projected to grow from $20.51 billion in 2009 to $59.79 billion in 2020, almost a 3x increase.
Beyond Online Gambling: Land-based Casinos and Cryptocurrency Adoption
Ultimately, bitcoin gambling isn’t just beneficial for people looking to establish bitcoin casinos or avid online gamblers.
Provably fair algorithms can also impact the future of the gambling industry as a whole even for those who play on a less frequent basis. These same algorithms also have the potential to be applied to games at land-based casinos in Las Vegas, Macao, and other popular destinations across the world.
Brock Pierce is seemingly everywhere in the cryptocurrency and blockchain space. One can trace Pierce’s fingerprints on a dizzying amount of industry-shaping events. Today, Pierce is still behind the steering wheel of some of the space’s largest happenings and projects. Pierce is currently the Chairman of the Bitcoin Foundation, a co-founder of Block.one, EOS Alliance,…
ABOUT THE AUTHOR
ABOUT THE AUTHOR
I enjoy researching new, innovative, and interesting blockchain/crypto projects that have the potential to impact the world. Whenever I’m not writing, I’m usually playing sports or producing music.