The Future of Regulation: How Blockchain and Crypto Impact iGaming Compliance

Jun 12, 2024

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There’s no refuting it, blockchain and cryptocurrency are on the rise, with the crypto gambling market worth about $250 million – a sizable chunk of the $100.9 billion iGaming industry.

These numbers confirm two things: cryptocurrency is here to stay, and the sooner we all adapt, the better.

From faster transactions to enhanced security, the benefits are indisputable and a game-changer. It redefines our way of thinking about money as well as how we can shake the iGaming industry up with fresh ideas in the upcoming years.

Yet, the rise of any technology means the likelihood of more regulations, raising a new set of questions about how we can adapt and stay compliant.

Why Blockchain & Crypto Matters

You may have heard or seen these words online, but what do they have to do with you, as an iGaming affiliate?

To get to the point, imagine yourself as a bettor, and ask yourself: why would I use blockchain and crypto over regular, fiat currencies?

Short answer: blockchain technology cuts out the middleman.

When you make a bet, you use cryptocurrencies like Bitcoin and Ethereum. A digital ledger (or blockchain if you like) records the bet details between yourself and the casino on a block of data. It verifies the data across a network of computers. The ledger is viewable at any time. If your bet strikes gold, you can collect your winnings from the blockchain – without needing anyone to verify or process them.

So, instead of waiting hours or even days through traditional intermediaries and centralized processes, you can withdraw your winnings sooner and at a cheaper rate with blockchain.

You’ll also enjoy more transparency, enhanced privacy, and better security, as your details can’t be tampered with.

The Impact of Blockchain and Crypto on Regulations

iGaming is predicted to reach $138 billion in revenue and hold up to 243.2 million players by 2028. The industry itself has always been at the forefront of innovation. It has adapted to countless modern technologies, including Augmented Reality (AR) and Virtual Reality (VR), and that trend won’t end anytime soon.

However, given the rise of innovations such as blockchain and crypto, regulation is more crucial than ever, as we embark on a new form of gambling.

The Malta Gaming Authority (MGA) is one example of a regulatory body that has continually adapted.

At the 2023 London Blockchain Conference, Odhran Griffin, an MGA system auditor, told CoinGeek of the rules that they’ve made. He disclosed that the MGA had evolved its regulatory stance for over 25 years to adapt to the newest technologies. The goal of these rules has been to protect players and support businesses.

For that reason, the MGA refuses to budge for blockchain, insisting the technology, like any other, must meet all its guidelines.

“We can’t simply set aside the requirements we’ve created over the years just to adopt this new technology. We want to do it in a way that we can maintain the same standards,” Griffin said.

While nothing is set in stone yet, we expect other regulators worldwide will follow a similar stance to MGA’s.

The Regulatory Issues of Blockchain & Crypto

Issue Explanation
Difficulty in ProhibitionBlockchain-based sites are censorship-resistant. This makes them hard to seize or ban.
Imposing RulesIt’s harder to apply rules and regulations when banks aren’t involved in transactions.
KYC ComplianceReputable wallets need ID to prevent illegal money activities and Know Your Customer (KYC) compliance.
Increased Anonymity of CryptocurrenciesTransactions are linked to wallets, not people: This keeps things open and straight, but it does leave a layer of anonymity. Governments could view this as a risk for illicit funding.
Volatility of CryptocurrenciesChanges in Bitcoin and Ethereum prices can make the balance sheets of operators unpredictable.

How Can Affiliates Adapt?

  • Stay Informed: Stay updated on all the latest iGaming trends; go to expos for firsthand knowledge on new developments; sign up for relevant regulatory authority’s newsletters and subscribe to iGaming magazines online.
  • Transparency: Disclose your actions. Ensure that all your promotions conform with the law in effect at the time. In addition, make public any relations you have with iGaming providers; this is important for your image.
  • Track Data: Tracking your income in such a fast-paced industry can simplify adherence. Voonix offers you an affiliate-tracking tool for this purpose; it helps you keep track of your income across various platforms in one place. 
  • Self-Regulation: It can be helpful to follow your own rules when it comes to staying compliant with various regulations, some of which might not be immediately apparent.

Of course, gambling operators keep abreast of the preferences and desires of the customers.

We are in no doubt, therefore, that blockchain is here to stay. The place it has gained in the iGaming niche is enormous; and to be among the leaders, one should stay updated, truthful, and adaptive. Preparedness and being proactive to change draw one closer to the benefits of the power of innovation and maximizing the gaming experience for users.

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