As payment technology continues to advance at breakneck speed, the days of cash are numbered. From digital payments to digital currencies and blockchain, we are moving increasingly towards a cashless society.
Particularly in recent months, following the pandemic, the impetus for a shift away from physical cash to digital money has only gathered more steam. Casinos are no different, and in many ways are actually better positioned to embrace the move fully to digital money.
In 2020, the American Gaming Association published a report calling for a faster move towards cashless systems in casinos and other gaming venues, citing the pandemic and government restrictions as the perfect opportunity to embrace the future of payment technology.
But how could this work in a casino setting, and what role does bitcoin have to play in the cashless future of casino gaming?
How cashless casinos work
Cashless casinos use technology as a form of player engagement, while also delivering enhanced protection for players—be it on slot machines or on the tables. And as a technology, blockchain provides a superior solution than other available options.
Physical chips won’t be replaced anytime soon, although cashless payments are proving to be advantageous especially with the current global pandemic situation. Players are assigned a Bitcoin wallet pegged to USD or other fiat currencies with an aim of reducing the need to carry and handle cash in and to the casino.
Consider this scenario: a high roller walking into a casino, ready to play. He transfers funds directly from his bank account to a Bitcoin wallet. He signs up to the casino’s payment platform, opens a casino Bitcoin wallet, loads up with money and then proceeds to play as normal. The player transfers funds from his casino wallet to the table’s wallet via a QR code and the chips are handed to him. Any winnings are returned back to the wallet, and all casino transactions run through the wallet, as with any other digital currency transaction. Players can redeem the tokens within the wallet like loyalty points, or get them converted back to fiat currency and into their bank accounts.
As an added bonus here, players are also automatically plugged in to the casino’s loyalty programme, allowing them to accrue and exchange loyalty points for meals, gifts and other perks—all part and parcel of the convenience that comes with playing through a Bitcoin wallet.
Cashless casinos are also possible with tokenization, providing a link between online and offline casinos that effectively bridges between the two gaming environments. Tokenization means physical casinos can go cashless, while merging with the online experience to allow players to wager in both environments through the same account. Players can bet on the online platform—like for example the Caesars online casino—while still earning loyalty player points, which can then be redeemed into gifts, meals, and other casino benefits in the usual way.
Here’s a practical use case: BitBoss
BitBoss is already leading the way in facilitating cashless casinos, with the help of its Bridge Ecosystem.
In an interview with CoinGeek in 2020, BitBoss co-founder and CEO Matt Dickson described the three key components of Bridge, and how it builds cashless casinos via tokenization.
“First, is a crypto-based mobile wallet. We decided on using a crypto/blockchain based wallet because it’s the most secure standard that exists today.”
“Second, we have a hardware device that is installed in every slot machine and table game. The device for slots/EGMs speaks SAS protocol. This allows us to bypass the casino management system that typically runs the casino.”
“The third component is a lightweight server that communicates with the blockchain. The flow is simple to understand. Say a customer wants to send credits to a slot machine. The customer’s wallet sends a transaction to the blockchain over the public internet. The casino has this lightweight server listening for transactions sent to the casino. Once the casino sees the transaction on the blockchain it then routes credits to the slot the customer is playing. This is the real magic of the blockchain.”
The advantage of Bridge is that it allows 100% verified proof of ownership of funds via the blockchain, without the need for expensive third party custodians. Support tools make it easy to restore lost wallets, while simple reporting functionality allows the casino full insight into money flows.
The ease of use for casino staff in processing transfers is matched by the convenience for players in connecting their wallet straight to their bank account, with stringent AML/KYC procedures built in to the app as standard. From a player perspective, it then becomes straightforward to convert funds into tokens simply by transferring them to their wallet.
What about regulation?
A key benefit of cashless casinos, at least in the U.S., comes from the regulatory benefits of playing through tokens in wallets, rather than cash transfers. As soon as funding with cash is involved, regulators want to know about it, which brings up a whole host of issues for casinos and players.
But in the case of cashless casinos, there’s no trading of coins taking place per se—rather, the transaction is in casino tokens that are part of a casino loyalty program, and have no physical utility beyond that function. There is no cash involved here, and no physical transactions which would attract the interest of regulators—instead, these are just wallet transfers of tokens, linked to casino loyalty programmes.
This no doubt makes cashless a more attractive option for operators, while also providing a host of convenience and other utility benefits for players. In many respects, it’s a no brainer, and a large part of why cashless casinos powered by bitcoin and blockchain are set to becoming the default of tomorrow.
Bitcoin and cashless casinos
In a world where the need for efficiency is driving technological change at an ever increasing rate, blockchain is unsurprisingly high on the agenda. Casinos in particular are well poised to benefit from the move to a cashless society, not least because of the ready-made benefits that come from blockchain and token payments in the casino setting.
With startups like BitBoss already leading the way, it looks certain that the next few years will see rapid growth in cashless casinos, and casino operators reliant on blockchain technology to improve the functional player experience.
See also: CoinGeek panel, iGaming Future on the Bitcoin Blockchain
Source: Read Full Article