Crypto Vs Fiat Currency Casinos

If you are undecided on whether to play at an online casino using cryptocurrency or using fiat currency, this guide could help. We look at some of the benefits of crypto casinos Vs tradtional online casinos.

The Evolution of Cryptocurrency Casinos

Online casinos came about between 1994 and 1996, accepting only fiat currency deposits. At the same time, we also saw sports betting and poker sites. These early online gambling entertainment platforms were accessible via desktop or laptop only and required an app download. Other gambling options were available using cable or satellite TV.

One important point to make about this early era of online gambling is crypto, cryptocurrency did not exist, and neither did Smartphones. It was Apple that kickstarted the new era of mobile gaming in 2007 with its iPhone before Android smartphones began to hit high street stores.

• 2009 – The Birth of Cryptocurrency: Moving forward, it was in 2009 that Bitcoin first came online offering a decentralised/decentralized digital currency.

• 2012 – Crypto Casino Begin to Appear: Bitcoin began at $0.003 per BTC in 2009 and by 2012 when the first Bitcoin casinos were coming online, one BTC was worth $13.00 showing a 4,333x.

• 2013 – Bitcoin Reaches $1,000: By 2013, the value of one BTC was up to $1,000. The race to start new Bitcoin casinos began. During this period, the Curacao licensing authority began issuing eGaming certificates to casinos that wanted to offer their clientele Bitcoin gambling.

• 2015 to 2017 – 100+ Bitcoin Casinos: The number of Bitcoin casinos rose into hundreds, while Ethereum became the second cryptocurrency online after it launched via the Frontier network. Also, accessibility to crypto exchanges and wallets became more widespread, giving players the option to choose self-custody or custodial wallets to buy, sell, trade, and store crypto.

• 2017 to Today: It is incredible to think that online casinos now accept 20+ cryptocurrencies since the rise of Bitcoin and Ethereum. Not only has the number of crypto risen, there are now thousands of online crypto casinos accepting BTC, BCH, LTC, ETH, DAO, TRX, USDT, XRP, BNB, FTN, and a host of other cryptocurrencies. Furthermore, crypto casino deposits and withdrawals for some cryptocurrencies are just as fast as fiat currency transactions.

The rise in cryptocurrency casinos is due to many factors. One being that you can now choose from several wallets no matter which country you are in. You can learn more about this topic via our guide – How to Choose a Crypto Wallet to Fund Online Casinos.

Problems Crypto Casinos Solve Vs. Fiat Currency Casinos

At Casinoplusbonus we always stick by the phrase ‘Each to their own’. If you prefer to play using fiat currency, then that’s great. If you prefer crypto, then that’s also great. We always say that the best way to play is the one that makes you feel most comfortable.

The idea of this section is to give you reason as to why so many players choose crypto over fiat currency casinos. As a result, this guide is more of an educational journey rather than us telling you that you should choose crypto over fiat currency.

Privacy and Anonymity When Transacting using Crypto

When you deposit to a cryptocurrency casino, your name is not on the transaction itself. Your name will be on the casino, and you will likely have had to pass a KYC check with most crypto casinos. However, there are a few crypto casinos that require no KYC checks.

Also, if you are using an exchange or custodial crypto wallet, you will likely have had to provide a KYC check, too. If your goal is to escape KYC checks, then a self-custody (non-custodial wallet) is your best option, and going further than this, a crypt casino that does not require KYC checks.

Find out more about online casino KYC checks here.

So what is so private and anonymous about crypto casino transactions Vs. Traditional Fiat Casinos?

• Crypto Casino Deposits & Withdrawals: When you send money to the casino or from the casino to your wallet, you only need to use a crypto address. It is a hexadecimal code and does not use your or the casino’s name on the transaction. All that shows on both sides of the transaction is a wallet address. The reason for this is because cryptocurrencies do not use an intermediary, and so names are not required.

• Fiat Currency Casino Deposits & Withdrawals: Both your name and the casino’s name show on the transaction. Therefore, casino transactions show up obviously on your bank statements or e-wallet. The reason for this is because fiat currencies use an intermediary, and they require a name to go with the transaction.

The key advantage of these anonymous and private transactions for cryptocurrency players benefits those who do not want their gambling activities made obvious by using fiat currency. As cryptos hide names, there is no obvious way to tell someone is gambling.

No Need to Store Banking Information On the Casino

This section also falls under the above section’s privacy, while we can also add security. Therefore, cryptocurrency players enjoy the benefit of added privacy and security when it comes to storing their funds.

Here’s how it works:

• Storing Fiat Currency Payment Methods: On a traditional fiat currency casino, you need to store or link credit/debit card, e-wallets, or bank details under the cashier area. Once your financial information is stored on the gambling website’s servers, you have to trust the site will keep your banking information private. There is one exception to this rule for crypto casinos. If you are using card-to-crypto casinos, then you will store your debit or credit card information on the casino.

• KYC Checks Debit/Credit Card Photos: The other issue with traditional fiat currency casinos is that if you are using debit/credit cards, during the KYC check process, you usually need to provide pictures of the front and back of your card. Some platforms will also ask for bank statement as proof of ownership of your account. The same process can apply to e-wallets at some casinos.

• No Banking Information Needed at Crypto Casinos: Crypto casino eliminates this problem because the casino supplies you with a crypto address under your account name to deposit. Your crypto address is there purely to accept payments. It cannot be used to withdraw money from a crypto wallet. In fact, you could spread it all over the internet with no risk of being hacked if you do. Yet it is not something we would recommend doing.

The key advantage that sways players to play using crypto in this section is that you don’t have to risk storing information that can be stolen and used to withdraw money from bank account. Essentially, crypto public addresses eliminate the need to store banking information.

Transparent Gaming Through Varifiable Provably Fair Game Results

One big difference between traditional fiat currency casinos and crypto casinos is the Provably Fair algorithm. It uses cryptographic hashing to create a hashed seed before the game starts and determines the outcome using a combination of actions you take during the game, a client seed, and a server seed. Some casinos store the results on a blockchain as an immutable record, while others store them on servers. Once your gaming session ends, you can access the blockchain ledger or server entry to verify that the results provided were accurate and fair.

Here are the differences between RNGs used by traditional online casinos Vs. Provably Fair Algorithms used by crypto casinos:

• Tradition Casinos Use Random Number Generators: All casino game software providers’ RNGs go through stringent testing to ensure they produce fair results. Once a software provider receives its RNG certificate, it can apply for online gambling licensing certificates or supply online casino under certain jurisdictions. However, there is no way you can personally verify RNG tests or the results. With that said, regulatory bodies and independent auditors can verify and certify RNG fairness.

• Provably Fair Algorithm: Not only does the Provably Fair algorithm produce random results, you can use third-party software or built-in crypto casino tools to verify the results of your gaming session. The software accesses your game session results via an immutable blockchain record or accesses your results via an off-chain server solution. The beauty of blockchain architecture is that once the ecosystem stores the record, it cannot be altered or deleted. Therefore, you can be one hundred percent certain that your verifiable results are legitimate.

Myth Buster

We’ve added a myth buster section because there is quite a lot of misinformation out there when it comes to explaining how the Provably Fair algorithm works.

• Off-chain Provably Algorithms: A common misconception is that ‘All’ Provably Fair transactions are stored on blockchain ecosystems. That isn’t the case. Some casinos store crypto game results on a blockchain ecosystem, while most in fact use off-chain solutions so you can verify your results.

• Pre-Generated Results: While you may have read Provably Fair algorithms do pre-generate results, in fact, the truth is most do not. The results use cryptographic hashing, which uses user input to determine the outcome of some games.

Not all games you bet on using crypto use the Provably Algorithm as some software providers still use RNGs. However, the Provably Fair algorithm has contributed to an increase in players who prefer to varify their game results instead of relying on an RNG test certificate.

Fast Crypto Transaction Speeds

When cryptocurrency casinos first came online, they used Bitcoin, which often takes 5 to 20 minutes to process a deposit. However, crypto casinos now have put systems in place that speed up crypto transaction times.

• Fast Fiat Currency Transactions: An advantage traditional fiat currency casinos have had over crypto in the past is instant transaction speeds. When you deposit, you hit a payment gateway that connects to the account holding your finances. It takes seconds to verify funds are available and to credit your casino bankroll then. However, in today’s modern crypto gaming, some cryptocurrencies process transactions as fast as fiat currency payment methods.

• Cryptos with Fast Transaction Time: Bitcoin is not the only crypto in town. There are faster cryptocurrencies like XRP, USDT, and FTN that take just seconds to process a deposit or withdrawal. Moreover, although BTC is still relatively slow, most casinos will confirm your deposit after just one Bitcoin network confirmation, thus speeding up BTC deposits.

Myth Buster

• Crypto Casinos Offer Faster Withdrawals: You will see many pro-crypto casino articles claim crypto withdrawals are faster than fiat currency casino withdrawals. The truth is, the withdrawal time is down to the rules of the casino you play at.

• Pending Time: Withdrawal times come down to the pending time, which is how long it takes the casino to approve your cash out request. Some crypto and traditional casinos offer instant withdrawal approval, others 0 to 24 hours, and others can take up to 72 hours.

With faster cryptocurrency transaction speeds now available, crypto casinos are attracting more players. Especially those who were previously put off by slow Bitcoin transaction times. An interesting guide that goes with this section is our Fastest Cryptos for Casino Deposits and Withdrawals guide!

Higher Value Bonus Offers

Crypto casinos will often offer larger deposit match amounts when using welcome bonus deals and reload bonuses. One popular opinion across most similar guides to this one is that crypto casinos can offer higher value bonus deals because the cost of transacting in crypto with players means the costs of running the casino are cheaper. As a result, the casino can pass on added value to players.

• Claim Higher Crypto Deposit Match bonus Balance: Although crypto deposit match bonus deals offer more deposit bonus cash, they are only useful if you are looking to deposit a high amount of crypto.

• Deposit match Percentages: The percentage of the deposit match between crypto and traditional online casinos depends on the iGaming platform you choose to play at. Therefore, some will offer 100% deposit match deals and others 150% whether it is a crypto or traditional fiat casino site.

It is difficult to say whether crypto attracts a large number of players due to the possibility of gaining higher bonus balances. Some high rollers, may well decide to play at a crypto casino because of the bonus balance, while there are high rollers that prefer other deals like cashback and VIP loyalty rewards.

Lower Transaction Fees

There are arguments for and against crypto casinos claiming they have lower transaction fees.  However, fiat currency casinos can become expensive when it comes to withdrawals, depending on the withdrawal method you choose to use. In this section, we’ll take a look at both deposits and withdrawals using crypto and fiat.

Deposits

• Fiat Currency Casino Deposit Fees: It is free to deposit in fiat currency to most online casinos. In fact, it would be unusual for traditional casinos to charge a deposit fee.

• Crypto Casino Deposits: When you deposit using crypto, the casino does not charge you a fee. However, you still need to pay a small network fee to the blockchain ecosystem of the crypto you are using. For most cryptocurrencies, the fees are barely noticeable. For example, Tron costs less than $0.10 to process a transaction, and for LTC the cost is around $0.0070. However, there are more expensive cryptos like TRC-20 (USDT), which usually costs $1.00 per transaction. Also, ETH can be expensive if the network is busy.

Withdrawals

• Fiat Currency Casino Withdrawals Fees: If you use bank transfer to withdraw fiats, you are likely going to have to pay a high transaction fee. Also, e-wallets usually take a 1% to 3% cut or add fixed fees to any withdrawals from a casino. That leaves you with credit/debit card withdrawals, which are generally free of charge.

• Crypto Casino Withdrawals Fees: Compared to withdrawing using fiat, crypto fees can be cheaper if you choose the right cryptocurrency. Withdrawing $1,000 in LTC might only cost $0.01, but withdrawing $10,000 in BTC might cost $1-$5.

Myth Buster

• Cryptos Offer Cheaper Deposits: This statement is not true in most cases. There are plenty of articles online claiming that casinos deposits using crypto are cheaper than fiat. They claim it is because there are no intermediaries. Yet, the truth is that deposits at traditional casinos are mostly free, and crypto blockchains charge you.

To sum up, withdrawals can be cheaper using crypto compared to using e-wallets, bank transfers, or apps that access your bank account. Fiat apps will generally charge you a fee. However, depositing in fiat to an online casino is generally cheaper than depositing crypto.

Smart Contract Gaming

The word ‘Smart’ in smart contracts is well earned. If you play at an online casino that uses smart contracts, you often don’t need to keep a casino balance there.

The process is straightforward:

• You begin a session on, let’s say an online slot.
• You enter how much you want to use in that session.
• The smart contract then initiates almost like an escrow account.
• When you close the session, whatever balance remains is returned to you.
• If you lose or a portion of the amount you placed into the smart contract, it pays the excess funds to the casino.

Myth Buster

• Smart Contract Casinos with No Licensing are Safe: Some players believe that if you do not need to keep a balance with the casino, it cannot steal your money. Indeed, the casino cannot steal your casino bankroll because you don’t have a balance. However, with no licensing, there is no authority confirming the casino’s games offer fair results. Even if the casino uses a Provably Fair algorithm, there is no guarantee to say the casino has not rigged the algorithm or the smart contracts.

Smart contract casinos are a great way to protect your crypto because you don’t need to keep a balance with the casino. Many of these casinos do not require KYC checks either. However, they can be risky to play at if a reputable licensing authority does not govern them.

Which is Better – A Fiat currency or Cryptocurrency Casino?

Choosing between a crypto casino and a fiat currency casino ultimately depends on your preferences. Crypto casinos offer greater privacy, faster transactions, lower fees, and provably fair gaming, while traditional online casinos provide broad accessibility, familiar payment methods, and regulatory oversight. Players who prioritise anonymity and efficiency may prefer crypto gambling, while those who value convenience and traditional banking may opt for fiat casinos.

in the end, both options have their advantages and drawbacks, so the best choice is the one that suits your needs. Regardless of your decision, always gamble responsibly and choose a reputable platform.

FAQ

What is a fiat on-ramp for crypto casinos and wallets?

An on-ramp means that you can convert your fiat currency like Canadian dollars or US dollars into cryptocurrency. The word ramp could also mean bridge. The ramp or bridge fills the gap between fiat and crypto, allowing you to pass your fiat over the bridge and convert into crypto. Some crypto wallets and exchanges offer both an on-ramp and off-ramp, while there are a growing number of crypto casinos offering on-ramps.

What is a self-custody crypto wallet?

A self-custody wallet means you have control over your crypto funds. When you open the wallet, you need to remember the seed phrase provided and store it safely. If you lose this phrase, you will lose access to your crypto.

What is a custodial wallet?

A third-party stores and controls your crypto. The disadvantage is that if the company becomes insolvent, you could lose your crypto. On top of this, custodial wallets can freeze your funds if they believe there is a legitimate reason to do so. On the other hand, a self-custody wallet is owned by you so that no one can freeze your funds. On the flip side, custodial wallets are advantageous because you do not need to remember and store a seed phrase. If you lose access to the wallet, you can regain access via customer support or password resets.

Why do self-custody wallets not require KYC checks?

The reason you do not need to pass a KYC check when using a self-custody wallet is because you own the wallet. There is no third-party involved. Your funds cannot be frozen, and there is no company holding your crypto, so no risk of losing your crypto funds due to insolvency.