Why Stablecoins are Abridging Mass Crypto Integration in iGaming
The online gambling industry is doing its utmost to make cryptocurrencies increasingly viable for all of its players. But are they approachable? Do they provide enough of a guarantee of security and functionality if players are to adopt them in the loads that crypto-oriented operators would want?
In fairness, rarely do innovative trends gain immediate traction, let alone one as close to universal. Since it’s an uphill battle between tradition, comfort, and what the casino finds as the bottom line, it will surely continue to be a complicated matter that makes things adopt a significant upside.
Outsiders and casual consumers of financial services rarely have the interest to get to know the language of a matter such as the blockchain. When it comes to the entrails of such operations and their fusing efforts with online gambling, there is an even more difficult effort for the laypeople who are not savvy or passionate about the subject.
However, the leverage that some new innovations in crypto gambling have started to attract enough attention. It means that digital gambling is becoming more than just free spins casino offers. It graduates into making sustainable moves that win them time without sacrificing their security.
Stablecoins are the primary method that can abridge the process of understanding and implementing crypto. They’re also some of the most well-seen coins in the traditional financial sector, and increasingly more leveraged by online gambling entities. Since they’re so viable, it’s time to discuss their relationship with iGaming.
What exactly are these stablecoins for a beginner?
If you find your way to this article and are not aware of the nature and structure of stablecoins, the best way to explain them is that they are cryptocurrencies backed by fiat currency. The common terminology will say that these stablecoins are pegged to fiat currencies, which gives them a backed in the traditional finance sector.
There are various examples that are generally trying to vie for attention, but the most popular ones are those that work with the USD.
The act of collateralization ties the cryptocurrency to its fiat counterpart, reserving its value with real-world-issued cash, making sure that it’s not just a digital currency. There are various models for it, but the main idea is to keep them as close to each other as possible.
The standard issuance is with USDT and USDC, each of them maintaining a 1:1 ratio with regular dollars. As such, every unit of USDT/USDC has the backing of a normal dollar. Essentially, you are turning your dollars into direct equivalents on the blockchain.
There are several other methods of maintaining the collateral relationship between them. Different real-world assets can be part of tokenizing efforts that maintain this level of stability. It has happened with gold, but this is not the only type. There are other elements, such as decentralized solutions like DAI, which have the backing of other crypto coins, lessening the stability factor.
The pros of implementing them
Since they’ve become more and more popular, we need to say that there are noticeable pros that both users and casino operators and implement. This is not accidental, nor is it a matter of finding something new and shining and trying it for the sake of doing so. We can identify the pros of their iGaming adherence in the following ways:
- Price stability does not deter players due to crypto value volatility. While crypto gambling, most notably with Bitcoin and Ethereum, can entail big margins due to changing in value, stablecoins provide price stability. Operators find this closer to their bottom line, which they can leverage to attract users.
- Quickness in transaction speed expedites the process of money conversion and movement. As such, deposits are instantaneous regardless of distance, but they can also come with fast withdrawals. Player receiving their money in a time-efficient manner is something that they value very much, and stablecoins provide a compromise between the quickness of the blockchain and the predictability leveraged by stability.
- Having lower fees when setting up financial operations within an online casino structure is something that helps a casino run itself better without sacrificing its bottom line.
- Accessibility on a global scale is something that many iGaming actors, both operators and players, appreciate. In a world where offshore gambling is taking center stage, this is very helpful due to the fast, global movement of money. There are plenty of traditional financial services that only work regionally, while stablecoins bring the global scale of the blockchain.
- Transparency enjoys an upscale due to provable fairness and the ability of smart contracts to prove that every transaction is legitimate.
Why are they a complicated matter?
While the entry-level list of advantages for a layperson is something that will attract them in such a way that makes sense, viability is something that requires a bit more contextualization. Unfortunately, not all this context is necessarily positive, which is what complicates things.
For the sake of a transparent and complete presentation of how stablecoins interact with the realities of global iGaming, we need to mention a few cons.
- Regulatory issues, especially from tightly regulated markets that want a strong grip over financial movements, are quite a big hurdle. The main idea behind these regulations is to keep an eye on the perpetration of money laundering and minor gambling, hence the AML and KYC protocols found at virtually every online casino, especially a regulated one. The idea of using stablecoins still falls under the umbrella of cryptocurrencies, for which regulators like the UKGC have their stance on blockchain technology.
- Issuer trust is something that can override the stability of this type of coin. The idea is that these stablecoins rely on reserves, and the viability of these reserves is what maintains the value of a stablecoin. If there were issues regarding the reserves of something like USDT, there would be an automatic drop in price, which would strike the 1:1 ratio that makes this stablecoin truly viable.
- There is still a technical barrier that many players, especially casual ones, are having issues clearing. As the world is today, there are still quite a few problems regarding the understanding and accessing of the blockchain. The reputation of complicated matters can deter players from onboarding en masse, which is a drawback that some casinos can have with their audience.
- Reconversion from stablecoins to fiat currencies can imply the problematic appearance of fees, which defeats the purpose of low standard fees when compared to other financial solutions.
Conclusion
There are quite a few reasons why implementing stablecoins in iGaming can feel like the future that abridges mass adherence to crypto gambling. However, the realities and hurdles of this medium will still feel like an issue to various demographics segments.
If you’re the type who games on any currency, you’d best remember to gamble responsibly!
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Krasimir Rusev is a journalist with many years of experience in covering cryptocurrencies and financial markets. He specializes in analysis, news, and forecasts for digital assets, providing readers with in-depth and reliable information on the latest market trends. His expertise and professionalism make him a valuable source of information for investors, traders, and anyone who follows the dynamics of the crypto world.
