One of the best ways to use cryptocurrency is as a funding method for online gambling. It turns out that the strengths of the digital coins dovetail almost perfectly with what it takes to maximize your online gambling experience. The key for potential cryptocurrency users is deciding whether they should stick with Bitcoin to get this done, of if they should try one of the alternatives to Bitcoin on the vast cryptocurrency market.
Many people are finding out that cryptocurrency is more than just an investment vehicle. They are realizing that the digital coins can serve purposes far beyond just rising and falling in value and acting as a diversifier in your portfolio. After all, that’s not why developers came up with the concept of cryptocurrency in the first place.
What they wanted to do was to put personal finance back in the hands of the individual and take it away from big financial institutions. Hence, Bitcoin, and all the coins that have followed in its wake, all spring from that idea. And the people who are using the digital coins in their everyday, online routine are finding out how beneficial they can be.
Chief among the uses for Bitcoin and its followers/competitors is online gambling. Instead of using a credit card to fund your account at a gambling website, you can use Bitcoin or many of the other popular alt-coins instead. In fact, a whole cottage industry is essentially popping up around the notion of gambling with cryptocurrency.
In fact, that little industry is becoming so crowded that it might just confuse you. How do you know which coins are best for usage at gambling websites? Each of the most well-known coins bring built-in advantages, but there are also drawbacks to using them as well.
In this article, we’ll try to explain how to choose the digital coins that you will use for your online gambling deposits. We’ll take a look at how Bitcoin and the other alternative coins developed, so that novices to cryptocurrency can understand what they are getting involved with should they buy the coins. Finally, we’ll talk about how the coins work with gambling sites and how each can be useful in that scenario compared with the others.
The Development of Cryptocurrency
Cryptocurrency is still a somewhat foreign concept to some people. That means that, before we can into talking about how each specific coin stands out in the field, it’s a good idea to go back to the beginning and follow the development of cryptocurrency from its earliest stages.
Basically, cryptocurrency is a digital currency. You can’t hold it in your hand the way you would a coin or a bill, but it acts in much the same way that cash does. Cryptocurrency allows you to send and receive money online almost as if you were handing cash from one party to the next.
No third parties have to be involved. And there are no real borders keeping you from sending cryptocurrency just about anywhere in the world. In addition, the technology behind it can serve many other purposes, all of which essentially give you the freedom and autonomy to deal with other people without relying on companies or middlemen to get involved.
Those are the basics. But how did we get to that point? Here is a brief rundown:
The Invention of Bitcoin
Bitcoin first was created about a decade ago almost as a kind of hypothetical experiment. How could one send money online to another person without involving third parties while still being able to trust in the legitimacy of the transaction?
The answer was to have the transactions verified by the Bitcoin network itself. This would take place thanks to miners, who would use cryptography to make transactions legitimate and be paid with cryptocurrency for their efforts.
This technology, known as blockchain, freed up the creation of Bitcoin, the first cryptocurrency. Over time, it developed value from simple supply and demand principles. And many people sought it as an investment because of its vast potential, causing the price of the coins to skyrocket.
But, investment or no investment, Bitcoin also made for easy, cheap, and fast online payments. Businesses slowly but surely began to accept the coins as payment.
But the truth is that the coins have still not come anywhere near their saturation point. That’s especially accurate considering that many true believers think that Bitcoin could eventually become the undisputed, worldwide currency, rendering the current monetary system obsolete in the process.
Because the blockchain technology wasn’t proprietary, others soon realized that there was room for more than one cryptocurrency in town. Other developers saw that the idea could possibly be improved upon to make things smoother for cryptocurrency users. And, as a result, alternative coins to Bitcoin, or alt-coins, soon flooded the cryptocurrency market.
These coins each had their own characteristics, but they generally tried to improve upon two areas:
Speed – As more and more people discovered Bitcoin, the network became bogged down with people trying to make transactions. Coin miners could only do so much, and the time it took to make a Bitcoin transaction slowed down considerably. New coins came up with ways to make transactions practically instantaneous.
Cost – Again, because of the logjam in the Bitcoin network, those who were trying to use the coins had to pony up extra funds to prioritize their transactions. In fact, small purchases with Bitcoin became less than cost effective because of the transaction fee required. Alt-coins focused on that area to try to win over new customers to their coins.
Of course, not every new coin was able to deliver on their promises. But a select few, including some that we’ll be mentioning later in this article (Litecoin, Dash, Monero, Bitcoin Cash), rose to near the top of the market. Although none have come close to matching Bitcoin’s value or popularity just yet, the best alt-coins have devoted legions of users and are building up their value as investments in their own right.
Second Generation Coins
At some point, developers and entrepreneurs realized that the technology behind Bitcoin and other payment system types of coins could be stretched beyond that purpose. Just as the internet opened up a world of possibilities for those with fresh ideas, so too has blockchain technology fired up the imaginations of many people. And the second generation of cryptocurrency coins are the result.
Leading the way in this area is the Ethereum network, with its proprietary coin, known as Ether. On this network, you can create your own application, or app, without having to answer to some overseeing party. You can also draw up your own smart contract with another person or entity and have the network automatically execute the terms.
The possibilities are truly limitless. For now, Ether is really the only of these “second-generation” coins to break through and capture the public’s imagination in a major way. But it seems only a matter of time before more really come busting down the door and make their presence felt in a big way.
How Cryptocurrency and Gambling Go Together
For those who have never done their gambling online before, you might have a hard time putting two and two together in terms of how cryptocurrency fits into that world. In actuality, the very nature of cryptocurrency makes it a truly smooth fit for online gamblers. And more and more sites pop up every day that either cater exclusively to crypto users or at least have some sort of exposure to those who want to get involved with digital coins.
When you sign up for a gambling website, you generally can’t begin to gamble until you make some sort of deposit. Some sites might allow you to make a free sports bet or two, or give you a certain amount of free spins on some online slots. But, for the most part, you won’t be allowed to start making money off your winnings until you deposit some money in an account.
That is where cryptocurrency comes into the equation. In the past, you would have had to use a credit card or bank card to fund your account. With cryptocurrency, there is no need to engage that third party; you can send your funds directly to the website to start playing.
For example, let’s say you wanted to put about $12,000 in your account. Since the price of Bitcoin has recently been in the neighborhood of $6,000 per coin, you would just need to send a pair of coins forward to the site. They would simply direct you to their wallet for Bitcoin and you would type in the codes for the necessary coins to make the transfer happen.
But you might be wondering why you would bother will all of that. Let’s take a look at the advantages of using cryptocurrency to fund your account:
Speed – Credit card companies and banks will often take a significant amount of time before processing your transactions, and that is time you could be spending gambling. When you make a deposit with Bitcoin or any of the other cryptocurrencies we’re about to mention, the money will show up in your account almost instantaneously.
Low Costs – If you are using a credit card to fund your gambling online, you’ll be dealing with interest fees if you don’t pay your card on time. But cryptocurrency only incurs a minor transaction fee. The size of that fee varies with the coin in question, but you can be sure it comes nowhere near the high interest rates of credit cards.
Security – Because all you have to expose to the gambling site is the amount that you want to deposit, the rest of your cryptocurrency funds stay safe. When you use a credit card or bank card, the numbers on the card can give hackers access to every last bit of your funds, even when you’re only using a small portion of your funds.
Anonymity – When you pay with cryptocurrency, you don’t need to reveal any of your personal information. That can be a really important quality for gamblers. After all, who wants to announce to the world that they’re going to be spending their money on gambling?
Choosing Your Coins
Now that you know the ins and outs of what makes cryptocurrency such a smooth partner with gambling websites, you’re ready to pick your cryptocurrency coins. Keep in mind that you need not be limited to just one. In fact, if you also want to save some of the coins as a kind of investment vehicle, having a bunch of different ones will allow you the diversification that is every investor’s goal.
The following is a partial list of some of the very best coins to use on gambling websites. Keep in mind that there are others, but these are the most widely-known and, thus, the most likely to be accepted by online casinos, sports books and the like.
Along the way, we’re also going to list the strengths and weaknesses of each coin, especially as it pertains to gambling.
Strengths: Bitcoin is the top cryptocurrency coin in terms of market share and usage rates. As a result, most of the top online casinos have some sort of Bitcoin betting option in place. In fact, many will offer you incentives just to use your Bitcoin.
In addition, Bitcoin is well-established. Whereas some of the other coins we are about to list don’t have the same track records of success, Bitcoin has a brand that is undeniable, which is impressive for a decentralized entity. What that means is that you can be pretty well assured that, if you buy some Bitcoin, it isn’t going to lose all its value tomorrow.
Weaknesses: We talked about a few of them earlier. Bitcoin can cost some extra money in fees to make a deposit to a gambling site. In addition, those deposits might take a little more time to get there than they would with other coins. Still, Bitcoin holds a significant edge in those departments over traditional methods of payment.
Finally, Bitcoin is the most expensive coin on the market, meaning you’ll have to pay a lot to get involved with it. You can buy fractions of the coin to try to mitigate the financial blow.
Strengths: Ether, the coin that fuels the Ethereum network, is a compelling case due to how versatile it is. On the one hand, you can use it just as you would the other coins here, depositing it into your account at a gambling website. As it is the second-most popular coin behind Bitcoin, you can be pretty sure the top sites will accept it.
But Ether also allows you the opportunity to gamble directly on the Ethereum network through the use of smart contracts. That means no exposing your funds to a gambling site. You can just deal directly with another person or entity on the network, which adds another layer of protection for your funds.
Weaknesses: The Ethereum network might be a bit too confusing for the average person to understand. And many of the gambling offerings on the network will lack the stability of what you can find on an established gambling website. Plus, the best gambling sites can offer you incentives to play, which is something you aren’t likely to be able to find on a start-up Ethereum operation.
Strengths: Litecoin has been around for eight years now, slightly less then Bitcoin, so it is no flash in the pan. It also offers faster transaction times and lower transaction fees than Bitcoin. That means faster deposits and more bang for your gambling buck.
Weaknesses: The value of Litecoin lags well behind Bitcoin, so you’ll have to buy a lot of it to give you enough for a significant amount for a deposit. In addition, it is not nearly as well-known. Your favorite online casino might not allow you to pay in Litecoin as a result.
Strengths: As a direct descendant of Bitcoin, it carries some of the same cachet as the original cryptocurrency. But it does so at a fraction of the cost. Plus, it’s mining protocol allows for faster transactions at lower costs.
Weaknesses: There is a bit of instability here. After all, it was created by those who wanted to split off from the original Bitcoin. And Bitcoin Cash recently split again because of a schism between two sides about how the coin should be mined.
Strengths: This altcoin has gained a quick footing in the online gambling world, with many sites catering to it. Perhaps the reason can be found in the name, which is a shorter way of saying “digital cash.” The idea being that you can use it with all the ease and convenience as you would if you were paying or receiving payment in cash.
Weaknesses: There aren’t any standout weaknesses here. It’s just that, like the rest of these coins, it is playing catch-up to Bitcoin in terms of acceptance and acknowledgement. It might have to battle some of the other alt-coins to stand out at the end of the day.
Strengths: This coin appeals to gamblers because it is one of the strongest on the market in terms of privacy. Although Bitcoin and other alt-coins are virtually anonymous, intrepid searchers might be able to figure out the source and amount of certain transactions. That’s not the case for those who use Monero.
Weaknesses: Again, it’s a matter of breaking through in the market. At the very least, Monero stands out because of its privacy hook. But you also have to realize that many who are doing their gambling online will be more concerned with getting their coin accepted by a site, and Monero, as a relative newcomer, can’t yet compete with some of the more established names in that area.
As you can see, the cryptocurrency realm is getting more complex and crowded by the day. But that’s good news for online gamblers, because it gives you more freedom of choice among coins. Take the time to consider the strengths and weaknesses for each coin before proceeding and you should find the cryptocurrencies that best serve your gambling needs.
Jim Beviglia joined Gamblingsites.org as a staff writer in 2018, parlaying his years of freelance writing into contributions on a number of different topics. He handles the sport of horse racing for GamblingSites.org and the intersection between the worlds of cryptocurrency and online gambling in a weekly blog.
For his full-time job, Jim handles the television and track announcing duties at a h ...
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