Crypto in Gambling: Market Overview 2024

While compiling this report on crypto casinos, Alanbase immediately realized that many people still find them a mystery! 

1. There is no common understanding of what crypto casinos are;
2. Very few people have worked in crypto casinos; 
3. There is a very skeptical attitude towards crypto casinos, so few people are able to talk about them. 

A little about Alanbase:

Alanbase is an affiliate program software company with more than 100 clients, including BetBoom, GloryPartners, and 4rabet. The software adapts to any niche and vertical. You can launch an affiliate program for the brand and create your multi-vertical CPA (cost-per-action) network. In addition, the platform is helpful for media buying teams, allowing them to track targeted actions and evaluate the effectiveness of various traffic sources with flexible management.

Alanbase consulted several market experts, each of whom explained the topic from their perspective. Thus, the report grew to a concise review of crypto in gambling.

The main questions addressed to make things clearer were:

1. What is a crypto casino? 
2. How is cryptocurrency used by licensed casinos?
3. Why do casinos want to become a crypto project, and why do so few of them succeed?

What is a crypto casino? 

They are most often confused with classic casinos, in which cryptocurrency is accepted alongside the usual fiat currency. In fact, these are either casinos that work only with crypto or casinos based on blockchain software. 

In this Alanbase article, we discuss both classic operators that accept crypto as a payment option and crypto casinos that accept only crypto. 

Examples of crypto casinos are Stake (until recently), BC Games, etc. The websites of such operators list a dozen cryptocurrencies they work with and current USDT (United States Department of the Treasury) rates.

The account is funded using two models:

1. Simple conversion to crypto with a fixed exchange rate at the start of the game session.=
2. Double conversion: from USDT to crypto and then to the game currency — with the exchange rate fixed at the start of the game session.

How is crypto connected to classic casinos?

Crypto has been actively used by casinos for a long time and has become popular with players as a replacement for the classic fiat. There are several reasons for this:

1. Crypto is anonymous money.

This might be important for players with ludomania or a condition similar to that. It is also so that neither your wife nor the bald devil himself will know that you are playing, and you will not have to explain to your family, ‘Where the money is, Lebowski!’ Well, the state will not force you to pay tax on it.

2. Crypto is a volatile currency.

Many people note that 2024 was marked by bull market trends. Crypto is growing, and with it, the cost of a player’s winnings is growing: the conditional $1000 of winnings per month can grow 3-4 times. Therefore, players are happy to make deposits in coins.

Following the same market trends, many casinos create their own token and stimulate player purchases by introducing deposit bonuses, regular bonuses, etc. What are the other advantages for the operator?

3. Casinos get more customers.

The player does not need to go through KYC, which certainly cuts through the red tape. Therefore, the withdrawal of small amounts without user identification is possible.

4. Casinos receive large deposits.

There is a bug in the psychology of players in principle: winning at the casino is easy money, and winning in the crypto is even more difficult to perceive as actual currency in other words, it is crazy money squared. “Therefore, deposits in the crypto are usually higher, much higher,” says Sergey Litvinov, CEO of the gambling company. – “It is also important that for big bets in fiat, you need to overcome a lot of obstacles: if you transfer a large amount to one card to top up your account, the bank, of course, will have questions about such transfers, but in the crypto — push one button and the money is gone.”

5. The conversion to the payment solution is 100%.

If 60-70% in fiat is a good indicator, then in the crypto, it is exactly 100%. There are no problems here; players can replenish their accounts with any amount.

6. Casinos attract affiliates with large payouts.

“If [classic] casinos usually pay $100 for CPA and 20% for Revshare, then crypto casinos offer us [affiliates] €200-250 and 45-50% for Revshare. Crypto casinos, in fact, do not need to pay taxes and spend money on the maintenance of their product, so it is quite possible to put such figures into their economy,” says Galina Bakusheva, the team’s partner and a recognized expert in SEO traffic on the gamble.

Is it really profitable for the casino to work with the crypto?

The question is more than logical: the volatility of crypto can become not only a bonus for the player but also a loss for the casino. Conditionally, the player made $1000, and during the game session, the cost of coins increased threefold. Do casinos pay out winnings based on this difference?

“No, the rate is fixed at the time of the gaming session, otherwise, it is simply unprofitable for the casino to work with the crypto,” Santino replies.

So why do all casinos dream of crypto casinos?

By and large, a crypto casino is not that difficult. The market offers gaming solutions and crypto processing for every taste. To launch, you need a “website” with games and a back office in the form of a CMS and CRM system.

“What I’ve noticed from my experience is that crypto casinos are probably most popular in locations where there is regulation. For example, it is popular in such countries as the USA, Mexico, Chile, Peru, Canada, Great Britain, Russia, Poland, France, and Australia, because people do not want to lighten their bank accounts and register legally, they try to optimize the tax base. And the resident players of these countries will not be able to receive payments without paying taxes,” Galina Bakusheva notes.

Sergey Litvinov continues her thought:

“There are regions in which there are no payments at all, and the inflation rate is such that it is stupid to keep assets in the national currency. In such regions such as Africa, some countries of LatAm and the Middle East, and Turkey, the population is much more active in mastering crypto and transferring savings into it simply because it is more reliable. Crypto markets are actively opening up in these regions, and there is enough audience for everyone here.”    

“In addition, payment systems often refuse to work with casinos. Thus, the products are simply forced to go into untraceable crypto,” says Galina Bakusheva.

Sergey Litvinov agrees with her:

“The ability to accept payments is one of the main problems of the casino. Whoever finds the payment card will dominate the region and pay for their traffic. In new products, the finance department is often larger than the development department of the casino itself, because you have to constantly go through the bills in the region. They are banished, fall off, and many cannot stand it and close. That’s partly why casinos are trying to move into the crypto.”

Many operators were inspired by the Stake case, which was successfully launched in 2017 and quickly gained popularity among players.

“But Stake’s success story was due to media partners with a huge audience, “— Sergey Litvinov notices.

Even Stake eventually switched to classic fiat because there are simply no predictable and scalable sources of traffic in crypto.

“Therefore, I often come across a story in the market that crypto casinos are as easy to launch as they are to close,” says Sergey Litvinov.

Christmas comes, but once a year: why are casinos not migrating to the crypto so massively?

1. Crypto casinos have difficulty finding players.

“It must be understood that cryptocurrency penetrates the population very slowly. Hand on heart, we can talk about a maximum of 1% of the world’s population who actively use the crypto for payments,” says Sergey Litvinov.

And it’s true. Traffic to classic casinos is launched to a very wide audience, sometimes even without dividing by m and f. How do I get the right crypto audience from here? “It turns out to be a dissonance: the most popular mechanics in gambling are regular slots, which attracts a non—thinking audience. And the main purveyors of crypto are geeks and crypto investors,” adds Sergey Litvinov.

In fact, the only available channels for crypto analysts are streamers and social media resources, especially Telegram channels, where the crypto community already exists. Optimizing such advertising is challenging, and there is no guarantee that you will reach the audience. More importantly, the number of such resources is limited, so the competition and banner blindness of the audience are growing exponentially.

2. Crypto casinos have difficulty finding affiliates

“If I see that the product works exclusively with crypto without any fiat options, I have questions. This suggests that people [casino owners] do not want to deal with the state and do not want to legalize their cash flows. They are not responsible for anything, so working with such casinos is a job you take at your own risk.

We had a negative case: such a product came to us. We tested, and worked on them, got nothing when we heard that all our traffic was “fraud”. And we didn’t work with them anymore,” says Galina Bakusheva.

“I would say that the lack of the possibility of fiat replenishment of the account indirectly simply means that the company is small. Compare: it costs $300-500 000 to open a fiat wallet, and with a crypto wallet, you can keep within $ 100,000 at least because you don’t need so many employees of the finance department to search for payments. I would say that trust rather gives rise to the brand and appearance of the casino,” says Sergey Litvinov.

“Yes, the main factor for us, as webmasters, in making a decision to work with a crypto casino would be brand awareness,” agrees Galina Bakusheva.

Conclusion

Whether to launch a crypto casino or not is a question. It seems that the story is more than tempting, but be prepared for:

1. difficulties in finding an audience;
2. working in narrow and sometimes difficult locations;
3. a large budget for working with brand awareness (content marketing, event marketing, etc.).

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