Crypto corner: The future is blockchain gambling
FunFair COO Lloyd Purser breaks down the fundamentals of blockchain gambling, why it is the superior future technology and what is in store for operators that jump onboard
For those who don’t know us, FunFair Technologies has been around since mid-2017. Over that time, we’ve been developing, marketing and operating our casino platform, crypto wallet and games on a foundation of blockchain technology.
Our vision has always been and remains to create a world of fair, decentralised gaming. We’re not the only ones forging ahead, pushing the technology and use cases in the space, there’s also start-ups like CasinoCoin, DAO Casino, Virtue Poker, Trueplay, BetterBetting and Wink to name just a few.
So, what’s it all about and why is it important? Blockchain provides many benefits that traditional gaming technology cannot. In its simplest form, the decentralised nature of the tech provides a clear advantage to players and that is unparalleled levels of trust and the ability to execute trustless transactions.
How does that translate and what does trustless actually mean? It simply means that any entity entering a transaction does not need to trust the other entity because there is no way to cheat the system.
How does that work? There are several key points here; firstly, the transactions are decentralised, secure, and through the use of digital assets (cryptocurrency), are open and transparent thanks to an immutable public ledger.
What does decentralised really mean? Unlike centralised systems such as banks or traditional gaming platforms, transactions are verified by many machines and not one central machine.
How is that secure? Because a bad actor would have to hack thousands of machines, not one to alter an outcome, on top of this, transactions are also cryptographically encrypted.
Choosing crypto
Why use cryptocurrency? Among other benefits, crypto enables the use of “non-custodial” wallets. If the wallet is truly non-custodial (some are, some aren’t), the casino operator never has custody of a player’s funds. That means that the customer is in control and winnings are immediately guaranteed and paid instantly into the customer’s wallet. Therefore, there’s no need for them to deposit into or withdraw out of the casino’s wallet.
Another benefit of using crypto is that it enables real-time reconciliation of all transactions when closing the game session, whether that’s the player’s winnings, an affiliate payment, operators’ winnings, platform fees, game developer fees and or whatever else you want to throw in the mix.
The games are also trustless. How? They can be 100% provably fair, with verifiable random number generator (RNGs). RNGs can be split and or hashed and then matched to ensure neither party has tampered with them. Also, when the player closes a game, all transactions, including the RNG can be made available to interrogate openly. As transactions are written to the blockchain, which is an immutable public ledger, there’s one single source of truth which, once verified, cannot be changed.
When the blockchain gambling community talk about unparalleled levels of trust, it’s not fluff, it’s a fundamental benefit of the tech and breaks down into a number of key areas, not just fairer games. The customer experience is very different, it’s more secure and positive, therefore very attractive to players.
From my experience, none of this is lost on the audience who appreciate it most, they are a new, younger generation of gambler. We know that trust and playing in cryptocurrency are a key driver for them. We’ve also seen that they like to play a different style of game. Simple style games like dice, crash, basic slots or instant wins are very popular.
So popular in fact that, according to dapp.com, a site which reports on the transaction volumes of all decentralised applications, transactions through blockchain gambling in 2019 were in excess of $7bn. That’s 75% of all decentralised applications’ volume. Blockchain tech is enabling clear customer benefit and to a new younger audience, the market is already sizeable and growing fast.
The operators which are the first to grasp this game-changing technology will benefit the most. In the short term by taking early market share among the younger players in this fast-growing space and in the long term by offering a fairer, better experience to all their players.
Lloyd Purser has been in igaming for over 15 years, working as a B2C operator and a B2B supplier across multiple verticals including sports and casino. His most recent role as COO of FunFair Technologies is focused on bringing blockchain gambling to the mainstream.