About Bitcoin gambling and Bitcoin casinos
Before we start discussing Bitcoin gambling in general and specific Bitcoin casinos it’s important to know a little bit about me.
I’m Simon, the owner of Simon’s Online Gambling Blog and I’ve been gambling online for 8 years and I’ve been working with online casinos – mostly Bitcoin casinos – for 3 years.
I’ve seen the good, the bad and the ugly side of Bitcoin gambling. I decided to share what I know with my visitors.
This guide is the result.
This Bitcoin gambling guide consists of two parts.
Part I., Bitcoin casino guide – A short summary of the Litecoin and Bitcoin casino(s). I explain why I don’t consider them safe and what led me to this conclusion.
Part II., Bitcoin gambling guide – This part tells you all you need to know about what’s going on behind the scenes in the Bitcoin gambling industry.
It also gives you all the tools and the know-how to be able to analyze any Bitcoin casino independently.
With the help of the tutorial you will be able to decide, whether a Bitcoin casino is SCAM or not ,without having to rely on anonymous strangers on Bitcoin forums (it’s manipulated, more on this below) or Bitcoin gambling blogs (many are fake and are actually owned by Bitcoin casinos, more on this later).
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Bitcoin casino guide
Advantages of Bitcoin casinos over regular casinos
Bitcoin casinos have some advantages over regular casinos, especially for US citizens.
The biggest advantages of Bitcoin casinos over regular online casinos are the following:
- Instant payout: regular online casinos usually make you wait 7-10 days (depending on casino and withdrawal method) before you can withdraw your winnings. You can withdraw and deposit instantly at a Bitcoin casino.
- New creative ideas: Bitcoin casinos are not bound by regulations of the online gambling industry. This is mostly a bad thing. However, being exempt of the rigid rules that govern online gambling, a Bitcoin casino is free to experiment with new types of games or new creative versions of traditional casino games.
Disadvantages of Bitcoin casinos compared to regular casinos
The disadvantages of playing at a Bitcoin casino far outweigh the advantages.
Here is a summary:
- Bitcoin casino operators are hiding their true identity for a reason
- lot of scammers
- low-quality startups
- many hackers
- connection with the dark web, money laundering
- no regulations means no repercussions (they can just take your money and there is nothing you can do about it, it is well documented, that if a player wins too much their winnings will be seized).
- players are vulnerable
Why you shouldn’t play in any Litecoin or Bitcoin casino
If you don’t want to read the whole Bitcoin casino guide here is a brief summary:
– Bitcoin casino have no gambling license ever (means if something happens there is none you can turn too).
– Casinos go to great lengths to hide their identities/the company behind them.
– Hackers constantly raid Bitcoin casinos and steal player’s personal and sensitive information.
– Unprofessional management & one-man casinos.
– Bitcoin casinos usually go bankrupt within a year taking all the player’s money with them.
– Unethical practices – which would get a regular casino blacklisted – are the norm.
I personally strongly not recommend playing in any Bitcoin casino.
Bitcoin gambling guide
The guide contains the following:
- Bitcoin community essentials, Bitcoin gambling need to know
- An overview of the Bitcoin gambling and Bitcoin casino market
- Step-by-step tutorial : how to spot scams and frauds
- The legal status of Bitcoin gambling around the world
There are many good things, which came out of the Bitcoin gambling community. And there are many bad things as well.
Let’s be impartial.
Let’s look at both sides of the coin; let’s take a look at the good, the bad and the ugly side of Bitcoin gambling.
This guide will provide you with all the necessary information to independently verify and asses a Bitcoin casino website’s credentials, safeness and value proposition.
Working in the Bitcoin gambling industry, my experience
Just like any other webmaster, it took me years to break even and to finally be able to make a living online, as a full time, independent webmaster.
In the meantime I worked and helped other aspiring blogs and businesses in their online marketing efforts.
Some of these businesses were Bitcoin gambling ventures.
Actually, quite a lot of them.
I have experience with Bitcoin casinos as a player, as an affiliate partner and as an online marketing professional.
And after working with many Bitcoin gambling websites I have formed an opinion.
An opinion that happens to be largely negative. However, there is hope.
Allow me to explain.
Bitcoin community and Bitcoin gambling essentials
I don’t intend to start from the basics, therefore I assume you know the following:
- you understand digital currencies and the way they work,
- you have heard of Bitcointalk and you know how important it is for the Bitcoin community,
- you know what is the dark web.
The Bitcoin gambling community is best understood by examining it’s defining attributes:
Anonymity –Have you ever been to 4chan /b/?
If not, don’t go there! Trust me.
You are better off not knowing (and seeing) what goes on there.
4chan, and all of its’ boards are the living embodiment of what anonymity inevitably leads to: raw human nature unfiltered, and brutal honesty.
If you have a lot of illusions, a lot naivety about humans and human nature it can be quite shocking.
Anonymity is a double edge sword.
Don’t forget the number one rule of being anonymous online:
- Nobody is anonymous online by default and people CHOOSE to be anonymous FOR A REASON.
Being anonymous is not a fashion statement. People who actively hide their identity do so for a reason
And the second rule of online anonymity:
Don’t trust anyone anonymous.
Bitcoin is anonymous and decentralized – It is used anonymously by people, who like it that way, for a reason.
Always try to figure out what that reason could be, and what it means for you!
People have different reasons to be anonymous. They do not necessarily have a nefarious intent, but they just might. It all depends on the situation and the context.
It’s one thing when people choose to be anonymous, but it’s entirely different ballpark when companies (Bitcoin gambling ventures) go to great lengths to hide their identity and erase every trace of themselves online.
Entrepreneurial spirit, innovation – Bitcoin is “hip” , “cool” , “young” etc….
These are not just buzzwords without substance. They are true, and most importantly: they attract entrepreneurs (mostly young, adventurous entrepreneurs with no capital and prior experience, 95.2% of them are men).
This leads to flawed business models and businesses, which only sound good on paper (e.g.: my favourite – Bitcoin snail race ).
Why is Bitcoin snail race a flawed business model? I think it’s cool! – you might say
Click on the drop down menu to find out.
Bitcoin snail race might generate great “buzz”. If they are lucky they might even be picked up by a few major news sites, Bitcoin blogs, where it will make a great headline and will be read by thousands.
This will bring in bucket-loads of “untargeted traffic”.
The problem with “untargeted traffic” is that “conversion rate” (visitors turning into players) is horrible.
99.99% of the people will be:
“Bitcoin snail race, HA-HA-HA, look at all those snails, funny!” and less than 0.001% of visitors will be : “Oh, Bitcoin snail race, I have a Bitcoin wallet and alternative sports betting sounds fun. Gotta bet right now!”.
But at least there will be some traffic and a few players in the beginning.
The internet’s attention span is very low and the buzz will be over in a few weeks, tops.
After than the business will rely on “search traffic” from search engines.
The truth is that nobody is searching for “Bitcoin snail races” online.
(They could start an intensive ad campaign at this point, an intensive ad campaign spanning a year. Of course that’s really expensive and that would mean, that they would incur heavy losses during the firs fiscal year. Bitcoin startups are nearly always small-scale startups, lacking any significant capital. So it’s not really an option.)
They might delay the inevitable, and the business might even stay afloat for 6-7 months.
Eventually reality will catch up and the businesses will close down taking their players’ money with them.
This story happens all too often in the world of Bitcoin gambling and Bitcoin casinos.
Decentralization, lack of regulation – Bitcoin gambling (or gambling with Litecoin or any other digital currency) is not recognized as gambling by law enforcement.
Therefore, if a Bitcoin gambling site closes down (because they went bankrupt, or because it was a SCAM all along) there will be a lot of “butt-hurt” people bashing it on Bitcointalk and other Bitcoin forums but nothing will be done.
Because nothing can be done.
The criminals just take the money they stole and re-brand under a different name (remember, they were anonymous all along) and just invest the money into an even bigger scam, ad infinitum.
That’s why there are so many scammers, because of the lack of repercussion brought about by anonymity.
IT skills – What do you get if you combine anonymity , IT skills and lack of regulations?
And not the white-hat data-security specialist guy, or the gray-hat “discovered this hole in you system, here is a funny LOLcat to replace your homepage, btw. FIX IT!” types. No, these are genuine, black-hat hackers.
Criminals, who destroy lives and businesses.
The Bitcoin world is full of them.
If you rob a Bitcoin casino there is no repercussion, law enforcement won’t care, because Bitcoin is not recognized as a real currency and Bitcoin gambling is not recognized as legal gambling. No wonder bitcoin casinos are popular targets of hacker attacks.
Dark web connection, money laundering – The elephant in the room.
On the dark web you can only pay with Bitcoins.
Have you ever wondered how these Bitcoins rejoin the mainstream economy?
Dark web vendors certainly don’t just collect and store them in their Bitcoin wallet forever.
And we are talking about a lot of Bitcoins here. Estimates put the now shut-down Silk Road’s monthly revenue at more than $ 2 million in Bitcoins. And it was just one website from the dark web.
I’m going to say what many people already knew or have suspected: BITCOIN GAMBLING IS A MONEY LAUNDERING SCHEME!
Bitcoin gambling and the Bitcoin economy is fueled (not solely of course) by the dark web and people associated with the dark web!
This is why Bitcoin casinos – any Bitcoin casino, that pays out your winnings in regular currency not just digital currencies – are not registered in the US.
They could register in the US, but in that case they would have to comply with strict US anti-money laundering laws.
Bitcoin casinos know that a large part of their business is coming from dark web entrepreneurs. They are not necessarily happy about this or even acknowledge it, or even be aware of it. However, it’s a fact.
Online gambling is a great way for these dark web vendors to whitewash their revenue. Undoubtedly, there are other ways to whitewash Bitcoins, but this is definitely one of them.
I hope this will change one day.
Bitcoin gambling and Bitcoin casino market
There is a lot of hype and misinformation surrounding the Bitcoin market. I believe this is what draws in so many inexperienced entrepreneurs. Entrepreneurs who should never even start a business.
The truth is, that Bitcoin gambling is a very small slice of the “gambling pie” (the online casino gambling market).
Here is a nice and very easy way to check and quantify Bitcoin’s share of the overall, global online casino gambling marketplace (online sports betting excluded for simplicity’s sake).
This is simple method anyone can use, anytime.
There are two things you need to know, unless you wish to make a comprehensive and detailed “keyword research” (I’m not going int details about what is a keyword research on this blog):
- the biggest search term of the Bitcoin gambling market is “Bitcoin casino”
- the biggest search term of the online casino gambling world is “online casino”
/Search term: what people type in Google to get what they want./
You can use Adwords (it’s free) to check the monthly “search volume” (number of people searching for it any given month) and compare them.
Online Bitcoin casino gambling represent 4.8% of the of the global, English speaking, online gambling market, based on this very simple comparison.
If you can get your Bitcoin casino to appear at the top (first 5 search results) in Google – which is no easy feat, requires a lot of work – you will get around 35% of the monthly search volume.
That is 6,600 x 0.35 = 2310 visitors per month from un-paid search traffic (traffic coming from search engines, which you did not pay for).
That’s a pretty sad amount of monthly visitors for a casino. This blog gets more visitors a DAY! And many online casino – regular, FIAT – get more visitors an hour.
If you are thinking:
“There is lite coin, dogecoin etc.. too! What about searches for “dogecoin casino”? What about Bing, Yahoo and other search engines?”
I checked traffic for these keywords. It is insignificant (<100). The fall of Bitcoin exchange rates pretty much destroyed these alternative digital currencies.
The truth is that the Bitcoin gambling market is really small and saturated.
A small, saturated market leads to desperate businesses and desperate tactics, a fight for survival, ethics thrown out the window.
I would advise enthusiastic entrepreneurs to stay away from the Bitcoin gambling market for these reasons. Especially now, with Bitcoin under $300 consistently.
Here are some examples of recent Bitcoin gambling scams to better illustrate all that I have said so far:
Coinbet.cc – Received some media exposure. It was a really big Bitcoin casino (casino games + poker + sports betting and live dealers) to go under.
The casino was plagued by hackers, inexperienced, unqualified managers and the final blow that knocked the casino out (or they closed down on purpose, maybe it was a scam all along?) was a big win by one of the players, the poker player Michael Katz. Either they could not, or did not want to pay out his winnings of around $300,000.
It has been speculated that the casino took $ 100 K worth of player’s deposits with it at the moment’s of it’s closure.
Some of the owners and participants were identified but as it is the case with all Bitcoin scams, no legal actions were taken (or could have been taken, but they didn’t even try).
Bitoomba Bitcoin casino – They first started to steal money from their affiliates and then they started to steal money from their players (some say their games were actually rigged as well, I can not confirm this – for obvious reasons, I have never played in their Bitcoin casino).
The site is removed by now – again, proving the point I made earlier about Bitcoin casinos shutting down after a short time.
EveryDice.com – Another Bitcoin dice site, which went bust. Taking investors’ and players’ money with it. If you went to the site a couple of months back, you could read their version of the story. I didn’t believe a word of it but it’s a good example of the finger-pointing, inner conflicts and “scammers scamming scammers” attitude. An attitude, that is all too common in the Bitcoin gambling community.
Note: this site too, has been taken down by now.
Tutorial: How to tell if a Bitcoincasino is a scam or not
Let me show you how to spot a scam Bitcoin gambling site with this step-by-step tutorial.
If you are using these methods you can minimize the chance of you getting ripped off by unscrupulous scammers!
First of all, If you create a website or start a business, then you lose your anonymity.
You can get it back, but you have to invest time and money to get it back.
And when it comes to businesses, every dollar spent is an investment, and needs to be justified.
Therefore, it is safe to assume that if a Bitcoin gambling website chooses to become anonymous, they do so for a reason.
Why on earth would a Bitcoin casino – which thrives on advertisements, generated publicity, online marketing – spend money on anonymity, the opposite of publicity? – Just think about this.
I’m not saying, there is always malicious intent behind this anonymity every time.
What I’m saying is that sadly, that’s more often the case, than not.
It’s definitely true, that the less anonymous a Bitcoin casino, the more you can trust it.
Here is how you should inspect a Bitcoin casino website – using Bitoomba (a known scam Bitcoin casino site) as an example – to avoid Bitcoin casino scams and to identify dishonest Bitcoin casinos who go to great lengths to hide their identity.
1.,Visit EasyWhois , type in the URL
2.,Check “Registrant Name:” and “Admin name” , if it’s Whois Agent, Whois protection service etc., they are using “Whois protection”
3., Next thing, you should check is domain age. “Creation date”
More than 90% of new Bitcoin gambling ventures go out of business in less than a year.
I strongly advise against playing in any Bitcoin casino that hasn’t been in operation for at least a year.
/It must be noted, that many Bitcoin casinos buy old, aged domains and domain age in those cases means nothing. If that’s the case you have to use Waybackmachine.com and check the earliest cache of the casino on the domain to verify the date./
Nothing you see here is actually the Bitcoin casino’s information. It’s all hidden on purpose.
4., Bitcointalk overall opinion
Sadly, Bitcoin gambling blogs and Bitcoin casino review blogs are mostly fake.
They promote every Bitcoin casino, which pay them for the promotion and you won’t find negative reviews on any of them (and they still promote a lot of closed-down Bitcoin casinos or known scammers. They just don’t care, they don’t really update their websites).
The Bitcoin gambling blog is actually run by one of the Bitcoin casinos or bookmakers.
/You can easily apply the methods we are discussing here to verify Bitcoin gambling blogs./
Even tough Bitcointalk is an anonymous forum, where anyone can say anything, I could easily generate 5 fake accounts and have fake discussions about how great a particular Bitcoin casino is.
Still, opinions here are far more diverse and it will give you a better idea about a Bitcoin casino, than fake review sites.
5., Check the website for any mention of the owner’s name or the company behind the casino: In Bitoomba’s case there is absolutely nothing, no mention of the owner or the company (if there is a company?).
It’s a bad sign.
6., Contact the casino before you deposit: make sure to try the contact the casino before you deposit.
If a bitcoin casino does not respond to your messages it means one or the combination of the following:
- they are not professionals
- it’s a scam
- it’s abandoned
- they will also not respond if you have a problem
- don’t expect to be able to withdraw your winnings
If you are not sure whether a Bitcoin, Litecoin or any alternative, digital currency accepting casino/bookmaker/poker room/dice parlor is safe or not, just drop me a line in the comments below and I will do my best to apply every little trick I know to determine whether they are safe or not.
There is a possibility, that Bitcoin gambling will be safer for the players in the not too distant future. The UK’s new gambling legislation, for example seem to allow it’s licensees to accept Bitcoins, if they declare it in their application. However, to my knowledge, no Bitcoin casino has been licensed so far.
Earlier this year Derby Jackpot, a legitimately licensed online horse race betting platform in the US state of Illinois started to legally accept wagers in Bitcoin. This is the first legally licensed US online gambling site to accept Bitcoin bets.
However, the Bitcoin gambling industry in general is still saturated with unfair, shady actors and players should be very very careful in trusting any Bitcoin casino with their money. The best bet for now, is indeed not to trust any of them.
The legal status of Bitcoin gambling and Bitcoin casinos around the world
Bitcoin casinos and other Bitcoin gambling operators often claim, that they can operate legally even in countries with illegal online gambling. The legality of Bitcoin casinos is much more complicated than that and generally, it’s closer to the actual truth, that where online gambling is illegal, so is Bitcoin gambling. Just think about the fact, that almost no online Bitcoin casino operates under a legit license.
Below I put together a table – based on my own research – about the legal status of Bitcoin gambling in the world, by countries.
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Back to the gambling websites.
Gamble responsibly, good luck,
Last updated: 2015.10.21