Why Crypto Casinos Are Becoming a Real Testbed For Blockchain Innovation

Cryptocurrencies and online gambling probably seem like two entirely different worlds. But while these industries might have little in common on the surface, they’ve been colliding to a fair extent in recent years. Crypto casinos – online gaming platforms that accept cryptocurrencies as payment and sometimes even run entirely on crypto – are emerging as a unique space within the gambling industry.

While many traditional online casinos offer cryptocurrency deposits as just another payment option, casinos specifically dedicated to crypto and blockchain transactions are really pushing blockchain experimentation forward. From faster and more verifiable transactions to innovative ways in which the blockchain can integrate into online casino games, crypto casinos are starting to act as a real testbed for the boundaries of blockchain technology – and not just for the gambling sector.

Faster, frictionless transactions

Crypto casinos already have a major edge over traditional online gambling operations in terms of speed. While online casinos used to regularly take days to process withdrawals and deposits, especially for more fiat-friendly methods like bank transfers and credit cards, cryptocurrencies can shrink those waiting times to minutes or even seconds. Just take a look at the top crypto casinos rated by askgamblers.com – they all offer near-instant deposits and withdrawals.

In addition to being more convenient for players and more efficient for operators, this kind of frictionless and fast exchange is also a good way to test out what the blockchain is capable of, both at high volume and at high speed. Crypto casinos are pushing the limits of how much volume a blockchain system can reliably handle – and how fast – and that kind of experimentation will be useful for blockchain transactions in the long run.

Transparency and provably fair gaming

“Provably fair” is a bit of a crypto casino buzzword, and for good reason. Blockchain tech lets players check and confirm that the outcome of a game was random and not influenced by the house. It’s a little more mathematically involved than that explanation makes it sound, but the idea is relatively straightforward; for every casino game, players can verify the house didn’t cheat.

This is useful not only in terms of trust and transparency but in terms of experimentation as well. Pushing provably fair gaming and the technologies that make it possible to the forefront of the mainstream iGaming industry is another way in which crypto casinos are proving and testing blockchain tech.

Smart contracts in action

You may have heard of smart contracts before, even if you haven’t read much about blockchain tech and its potential applications beyond crypto casinos. These are contracts, the terms of which are built directly into the blockchain, meaning that they can automatically execute once those terms have been fulfilled.

Casino operators can use smart contracts in a number of ways, from automatic payouts to more complex bonus and terms control. By putting these smart contracts to use in a live setting, especially at the scale and volume of the crypto casino market, the industry is helping to iron out kinks and fine-tune this technology.

Privacy-first gaming

Privacy is a major draw for many players in traditional and crypto casinos alike, but with a much lower barrier for data entry, crypto casinos can offer a more private experience. While some regulations still force operators to collect certain information for anti-fraud and anti-money laundering requirements, privacy and anonymity are easier to guarantee on a cryptocurrency platform.

By testing out how far blockchain and privacy can go in high-volume environments with lots of high-stakes transactions, crypto casinos are contributing another use case in an industry where data privacy will continue to be a major concern.

Challenges and hurdles as innovation catalysts

It’s not all smooth sailing, though. From international regulations to the volatility of individual cryptocurrencies, the industry still has a number of roadblocks to overcome. In some ways, however, these hurdles and challenges can be just as useful to blockchain development as successes, because they highlight weak points.

Take volatile coin values, for example. Since most cryptocurrencies are not pegged to any sort of stable currency or asset, their value can fluctuate wildly from day to day. This makes it challenging for casinos to set wagering limits or even to reliably post their winnings in a fiat currency, for example. This is leading some platforms to experiment with stablecoins – coins pegged to a more reliable currency. In short, this creates another blockchain test-case. Regulation breakthroughs are becoming more and more common by the day.

How this can impact other industries

The problem with most blockchain innovation in any industry is that, for a variety of reasons, experimentation, testing and implementation are slow. In some cases, it can take years to get new technology or new features out to the public in anything other than an extremely limited capacity.

Online casinos, and particularly high-stakes and fast-growing crypto casinos, can update and innovate and try new features with much less friction and much more speed. That means it’s likely that many blockchain technologies that will be used across industries in the future have already been stress-tested by crypto casinos long before they make their way to other sectors.

Where innovations get put to the test

Crypto casinos are more than just a new opportunity for gamblers, and more than just an interesting case study for blockchain tech. These new innovations in iGaming are testing and pushing the limits of blockchain technology with real users in high-volume and high-stakes environments.

Faster, frictionless, more transparent transactions are already proving and improving what blockchain can do for the future of finance, but with so many more industries eyeing blockchain for everything from supply chain management to voting systems, innovations tested in this field are likely to pay off for other fields down the line as well.

In the end, this kind of testing ground is the best way to prove how the blockchain can work, not just in theory but also in practice. Crypto casinos will be able to serve that function and contribute to and inform blockchain innovation in the future, no matter whether or not you ever want to put any of your coins on red.