History may very well look back on 2020 as a seminal year in which so many political, social, and medical norms were upended. The world's reaction to coronavirus has led to systemic changes in just about every area of life. It has even impacted gambling.
From the early days of the pandemic, when casinos began turning off the lights and locking the doors, it was glaringly apparent that casinos packed shoulder-to-shoulder would be going the way of the dinosaur.
Social distancing at land-based casinos is now the accepted norm. But there is something else afoot, something that land-based casinos are taking away from the online world. They are looking at going entirely cashless but with a greater emphasis on cryptocurrency rather than debit and credit card payments. Some are even speculating that the entire industry - both online and land-based - is closer to a universal gambling token than ever before.
Gambling with cash
Turn the clock back 70 years and you will find yourself in a time during which all gambling was facilitated by cash. The major casinos traded cash for chips players took to the tables. However, slot machines accepted coins. And at poker halls and private clubs, no chips were necessary. People brought their bills to the game.
These days you visit the casino and purchase chips for play throughout. Use your debit card, your credit card, your phone payment system, or cash. And when you are done for the night, you can cash out any chips you have remaining.
What if cash were no longer an option? According to some news reports, casinos are looking to phase out cash.1 Gamblers are already arriving and finding casino ATMs not working due to social distancing guidelines. Banks are making it harder for casinos to deal with cash for the same reason. As the thinking goes, cash could transmit the virus. Whether or not that is true really is not the issue here. The fact is that the banking system thinks it's true, so there is a move afoot to take cash out of the equation.
This has obviously never been a concern for online operators. You cannot use cash to gamble online anyway, so online operators have chosen plenty of other options. They accept credit and debit cards, e-wallet systems, platforms like PayPal and Skrill, and even electronic funds transfers (EFTs). Increasingly, they are accepting cryptocurrency payments, too.
The 'big 5' cryptos for online gambling are Bitcoin (BTC), Bitcoin Cash (BCH), Litecoin (LTC), Ethereum (ETH) and Dash (DASH). Some online casinos accept crypto deposits and then immediately convert them to fiat for play. Others allow players to leave their crypto assets as is. It is a mixed bag. And that brings us to the idea of a single gambling token.
Single token simplicity
A small number of people on the cutting edge of both cryptocurrency and online gambling have floated the possibility of a dedicated token for years. The idea is simple: a single token dedicated to gambling simplifies the entire blockchain environment - at least from an accounting standpoint. If the industry chooses a blockchain that offers both a token and a development platform, like Bitcoin SV and Ethereum offer, even better.
Gambling with a single token would simplify payments considerably. Online casinos would only have to worry about one system. Everybody deposits the same token and plays with it. All withdrawals are made with that same token as well. There is no need to work out multiple payment options with either players or payment processors.
Accounting would also be easier inasmuch as every transaction would be automatically verified and added to an irrevocable ledger. There would be absolutely no chargebacks, protecting online operators from the fraud and abuse credit cards are known for.
Here is the thing: online operators have known this for quite some time. It is not unreasonable to believe that a majority of them would go all crypto if it were not for the market's volatility. A single token dedicated exclusively to gambling would solve the volatility problem.
Crypto gambling at land-based casinos
Knowing what we know about gambling online with cryptocurrency takes us back to the problem land-based casinos are now facing. Banks are looking to reduce cash transactions. The banking system itself would do far better if cash were completely eliminated. It is also no secret that national governments and their central-bank allies are feverishly working toward digital currencies for the purpose of completely eliminating bills and coins.
Seeing as how the world is already headed in that direction, land-based gambling operators have to start thinking about a world without cash. They are fine with credit and debit card payments for now. They are content with payment platforms, mobile payment apps, and e-wallets. Yet all of the inherent weaknesses of those other payment systems are as problematic for land-based casinos as they are for online operators.
So what are land-based operators to do? For starters, they might think about participating in the 2020 CoinGeek Live conference sponsored by Bitcoin SV. The conference runs three days from September 30 through October 2. Cashless casinos represent just one of the many topics to be discussed.
Imagine visiting your favorite land-based casino with nothing on you, in terms of payment, but your smartphone with a cryptocurrency wallet app. Walk up to any table or slot machine, waive your phone, and start gambling. Everything happens quickly and seamlessly. When you are ready to cash out, transfer your remaining coins back into your wallet and go your way.
In a perfect world, it would be that simple. In practice however, there are still plenty of things to work out before we get to that point. But a single gambling token would be a big step toward making it work. The people behind Bitcoin SV want their token to be the one. Whether or not they succeed remains to be seen.
Buying and selling tokens
One of the sticky issues to work out is the buying and selling of gambling tokens. Would they be bought and sold only by gambling operators? If so, that would seem to defeat the purpose of going with a single token to begin with. Operators do not need the hassles that come with currency exchange.
Another option is to sell the tokens on crypto exchanges. Everyone would buy or sell on the exchange - even the casino operators themselves. This would separate the token from operators and add some built-in security to the system. It would also eliminate the need for payment processors acting as intermediaries. The one downside is that gambling regulations would almost certainly have to extend to exchanges that sold the tokens. They would have to submit to more intense scrutiny designed to stop criminal activity.
That could ultimately be a good thing to some degree. Bringing exchanges under some unified regulation could help control some of the questionable practices we all know exist within the industry. And as far as a gambling token is concerned, volatility can be addressed with a few rules here and there.
It is easy to imagine an environment in which gamblers - both online and land-based - could go to an exchange to purchase gambling tokens. They could deposit those tokens at any online casino they choose. They could also save some for use at a land-based casino on their next holiday. Converting them back to fiat would be a matter of taking them to an exchange and selling them.
Of course, exchange operators have to make the money as well. There would be exchange rates between the tokens and various fiat currencies. Exchanges would compete with one another by way of the rates and fees they charge. Everybody is happy.
The loss of cash gambling
Going completely cashless at the casino seems inevitable at this point. It is clear that the banking industry wants to do away with bills and coins. It is probably a good thing for casinos in terms of accounting efficiency. But if you are into nostalgia, it is not good at all.
There is something exciting about walking up to a poker table and sitting down with a wad of bills in your hand. Chips just do not have that same romantic appeal. Back in the day, it was also pretty exciting to win the jackpot on a slot machine and see all those quarters spilling out onto the floor. Unfortunately, those days are quickly going away.
The modern gambling environment is much more sterile. Mechanical one-armed bandits were replaced with video slots decades ago. Traditional video slots are now being replaced by video terminals streaming software that is actually running on a remote server.
At least table games are still available at land-based casinos. Thanks to the internet and high-speed audio and video, you can play live table games online as well. But once cash goes by the wayside, an era with a storied past goes with it. The rise of crypto gambling will take its place at some point. And perhaps that will usher in a single gambling token that will create its own nostalgia along the way. If that happens, we can thank coronavirus for it.
1) The Indian Wire. Casinos go Cashless due to COVID