Ethereum is a blockchain-based cryptocurrency and the name of a company that made the most prominent blockchain platform for developing decentralized applications. It was only a matter of time when Ethereum casinos would begin popping up all over the web, as ETH makes it extremely easy to process transactions. These casinos often boast about being “verifiably safe.”
As we do with our informative casino guides, we will take a deep dive into Ethereum casinos. In this article, we’ll not only explore the concept of being verifiably safe but also make a detailed overview of Ethereum casinos. We’ll look at how these platforms work and what you should pay attention to as a player who wants to join one such site.
Does Verifiably Safe Equal Provably Fair?
Before we start, let’s get one thing out of the way. People often use the term “verifiably safe” for Etheruem casinos, while they should in fact be using the term “provably fair.” Now that we have the terminology sorted out, we can start exploring the world of Ethereum casinos. Read on!
What Is Ethereum? A Brief History of the Most Important Technology Since the Invention of the Internet
What gives value to paper money? It’s all based on a mutual consensus and trust that these papers are worth something. Money such as dollars, euros, pesos, dinars, and other national currencies are known as fiat currencies. We all agree that every single coin of fiat money has its worth. We trust them.
However, humankind has struggled to achieve a similar effect with digital money. Even when we started using credit cards and e-wallets, fiat money was still #1. Enter Bitcoin.
To explain Ethereum well, we must start with “digital gold.” Bitcoin was created by an anonymous person or group under the pseudonym Satoshi Nakamoto, based on blockchain technology.
Blockchain Technology – Beginnings
Simply put, blockchain technology uses a distributed ledger that’s present on all computers around the globe that are part of a blockchain network. That way, trust is established, as there’s no centralized entity that makes the decisions, which is the case with fiat money, where central banks assume that role.
But let’s not get too technical, as this article is about Ethereum casinos. You need to know that Bitcoin managed to start a revolution of sorts, as it became the first trusted digital currency. It gave birth to a new type of money — cryptocurrencies.
Ethereum Origins – Beautiful Mind of Vitalik Buterin
While Bitcoin was gaining popularity, a young Russian-Canadian prodigy Vitalik Buterin started realizing that blockchain can be used for more than just money. Buterin dreamt of a fairer world where centralized authorities could not abuse ordinary people’s rights and privacy.
What if a single organization didn’t run Facebook? What if all platforms and companies were based on decentralized structures, where members of the network all had a vote. What if the hierarchical structure of any organization became a thing of the past? Although these were just dreams, blockchain technology had to start with baby steps. Therefore, Buterin decided to found a company which he named Ethereum.
It’s purpose – to make the world decentralized.
Smart Contracts – Changing the Way We Play the Blockchain Game
Now, Buterin came up with something called smart contracts. Essentially, they are written in code and are contracts that self-execute if all sides agree to a deal. These agreements are distributed all over the blockchain, meaning they are immutable.
Simply put, Buterin paved the way for blockchain developers to create decentralized applications, also known as “dapps.” Dapps use a peer-to-peer network that’s decentralized, meaning their backend code is on the network rather than being part of centralized servers. This makes them automatically open-source, and each dapp can have an ecosystem of its own. Moreover, dapps all have their smart contracts that run things in the background.
Dapps Pave the Way for Ethereum Casinos
Let’s refer to the Facebook example from above. Whatever you post on this social network is part of a central server. If that server is hacked, out goes your sensitive data. However, in a decentralized scenario, data would be distributed over hundreds — if not thousands — of computers that are part of the blockchain network that a decentralized Facebook would operate on. The Cambridge Analytica hijacking would never have occurred in such a scenario.
Some assume that Facebook willingly provided data to a third party. Think about it — a single company is deciding what to do with your data. It’s scary. That wouldn’t be possible if FB was decentralized. A consensus of thousands of nodes would have to be reached to make such a move.
Every online casino operator needs licenses and certifications to gain users’ trust. What if there was a technology based on the concept of trust? The blend of the online gambling industry, the blockchain technology, and the Ethereum network makes this possible. Suddenly, casinos have a way to prove that they’re fair and square in a transparent manner. In other words, they can be provably fair.
Ethereum in the Online Gambling Industry – Best Ethereum Casinos
As soon as Ethereum underwent rapid expansion, many gambling operators decided to give it a try. Nowadays, we have hundreds of casinos that use Ethereum in one way or another. But not all of these platforms are worth your time and money. Just because they use state-of-the-art technology and payment services, doesn’t mean that they’re good.
Therefore, you should be very careful when choosing a good Ethereum casino. Despite being fair, they still need to meet other player requirements, such as offering generous bonuses and exciting games.
Online casino lovers should make a distinction between two types of Ethereum casinos, so let’s check them out.
Ethereum as a Payment Service vs. Casinos With Smart Contracts
Ethereum gambling is exciting — there’s no doubt about it. However, you can gamble with Ethereum even if a casino doesn’t use smart contracts. In fact, you can use Ethereum on gambling sites that aren’t decentralized at all. Confused? Let me explain.
Every ecosystem built on a blockchain network needs to have a currency of its own. Therefore, when Ethereum was created, it gave birth to Ether (ETH), its cryptocurrency. Ether is just like Bitcoin – it’s a digital currency that you can use to buy things. You can trade it or even exchange it for other cryptocurrencies on select online crypto exchange platforms.
This means that you can use Ethereum for online purchases on sites that accept this payment method. Therefore, some casinos that aren’t powered by Ethereum as a network and a platform still can accept ETH as a currency. In other words, they don’t have to be literal Ethereum casinos to be able to use this currency
The main difference between real Ethereum casinos and those that only accept Ether as a payment option is that the latter can accept other options as well, including other cryptocurrencies, bank transfers, e-wallets, credit cards, and more. Ethereum-based casinos can only accept Ether for deposits and withdrawals.
In plain English, the phrase “Ethereum casino” refers both to Ethereum gambling platforms and platforms that only accept ETH as one of their payment methods, but there’s no use of smart contracts in them.
Safety, Security, and Fairness of Ethereum Gambling Sites
The safety and security of online platforms that are not based on smart contracts are achieved in many ways. The most important one is that the casino needs to have a valid license from a reputable regulator, such as the Malta Gaming Authority, the United Kingdom Gambling Commission, and more.
These regulators will inspect the site and provide a license for legal operations. Casinos that do use smart contracts also need licenses to operate, but they don’t need them to prove that they’re safe.
Non-Ethereum online casinos aren’t provably fair. To showcase their fairness, they need to have a certificate from a company that would inspect the sites and all their processes. If the auditor decides that the casino is fair, they will award it a certificate for fairness, and you need to trust that the auditor was honest and no games were rigged on the site. Truth be told, there are several companies out there, such as eCOGRA, that built their reputation on being honest auditors, meaning that if an online casino has an eCOGRA certificate for fairness, you can probably trust it.
Every casino uses a so-called random number generator (RNG), which is just a piece of code that makes games random. In other words, it ensures that they cannot be rigged. Inspecting RNGs is one of the main tasks of online casino auditing companies.
But one small issue remains – you still need to rely on a central authority to tell you whether everything is fair or not. When an Ethereum casino is based on all the good things that blockchain comes with, there’s no need to rely on auditing companies for fairness. Everything is in code, and everything is at your disposal.
Therefore, Ethereum casinos that use smart contracts are provably fair. In other words, the operator of every Ethereum casino uses code that can be publicly examined. You would need a bit of math and coding knowledge to check the code yourself, but the sheer fact that you can access and examine how it works is enough to gain trust.
Therefore, you can verify the safety of a casino and its smart contracts, which makes Ethereum gambling pretty appealing, especially for those who are currently engaged in the world of cryptocurrencies and blockchain.
To answer this article’s central question — Ethereum casinos and their smart contracts are indeed provably fair and verifiably safe. The technology enables casino lovers to enjoy the transparency of online casinos and feel safe and secure while gambling.
Now that that’s out of the way let’s explore how Ethereum gambling works in practice.
How to Use Ethereum in Online Casinos?
To make a deposit in Ethereum, you need to obtain the cryptocurrency first, and there are several ways to do that:
- Have someone send it to you (either as a gift or as compensation for your work).
- Buy it with fiat money in one of the available cryptocurrency exchanges.
- Exchange another cryptocurrency for Ethereum.
To store crypto, you need an Ethereum wallet, which is just a piece of software that you can download for free on your desktop or mobile device. There are many Ethereum wallets out there, and some of them can also store other cryptocurrencies.
Wallets use addresses to send and receive money. Your wallet has an address that needs to be entered to initiate a transaction to your wallet.
The next thing to do is find a good Ethereum casino and open an account. Then, the depositing process should look like this:
- Go to the Cashier section.
- Select Ethereum as your preferred payment method.
- Enter the amount that you would like to deposit.
- You’ll receive an Ethereum address.
- Open your wallet and enter the deposit amount, as well as the address provided by the casino.
- Wait for your transaction to be processed.
- Enjoy playing casino games with Ethereum!
At this point, you’re probably wondering — what’s the point of depositing Ethereum. What do I get if I still play casino games on a site not supported by blockchain technology? This leads us to the next part of this article — the pros and cons of Ethereum as a payment option.
Advantages of Ethereum as a Payment Method
Here’s a list of the advantages of making deposits using Ethereum.
Anonymity
Ethereum wallets don’t require any information about you. All transactions are peer-to-peer and encrypted, meaning you’ll remain safe and anonymous all the way.
Speed
Ethereum may not be the fastest payment option out there, but it’s certainly much quicker than most traditional banking methods. Therefore, it’s safe to say that speed is indeed a huge advantage of this cryptocurrency.
Safety
Transactions based on blockchain are virtually impenetrable by cyberattacks, meaning you’ll remain 100% safe when using this option for deposits and withdrawals.
Good Limits
Both Ethereum blockchain casinos and those that only accept it as a payment option can offer significant deposit and withdrawal limits. Most of the time, it’s the payment method issuer that sets the limits instead of casinos. Card issuers and banks determine a $5,000 limit per transaction on some credit cards. Since there are no such limits for cryptocurrency transactions, you can deposit as little or as much as you want as the limits are very generous. The same goes for cashing out.
Low Fees
When depositing in fiat money, the third party — the middleman, if you will — charges their service. If you use a Visa credit card, the transaction will be charged by Visa. E-wallet companies will charge transactions as well if you use their services.
But what happens when you deposit in cryptocurrencies since they have no centralized authority behind them? Well, you’ll still have to pay a small amount that will serve as an incentive to those that are part of the Ethereum blockchain and make it run. Nevertheless, the fee is much lower compared to other banking options.
Disadvantages of Ethereum as a Payment Method
Cryptocurrencies solved a lot of payment-related problems, but they are still not perfect. Therefore, here are a couple of things that are still considered drawbacks, especially when it comes to Ethereum.
New Users May Get Confused
If you’re new to the world of cryptocurrencies, all of this may sound too complex. Even though explaining the underlying technology to a non-technical person might be somewhat of a challenge, cryptocurrencies (and blockchain) are there to make everything more convenient. We just have to get used to it. Either way, many people still don’t want to have anything to do with Ethereum as they don’t understand it, and that could be one of the reasons why cryptos are still struggling on their way to mass adoption.
Difficult to Obtain
Fiat money is everywhere, Ethereum is not. The safest way to obtain some ETH is to purchase some on a cryptocurrency exchange, but that involves additional steps that many aren’t willing to take.
Not Many Casinos Accepting Ethereum
Even though it seems that online casinos are welcoming cryptocurrencies with open arms, that’s an illusion. Most of the casinos on the web still don’t accept any crypto payment methods, let alone Ethereum, which is far less prevalent than Bitcoin. Therefore, the choice of casinos is still pretty limited.
Bonus Chasers May Get Discouraged
Many online casino players actively look for new casinos with those attractive welcome bonuses. At the moment the industry is still waking up to the benefits of Etherium casinos. So, when you find a good one you might be more tempted to stay loyal to them.
How to Find a Good Ethereum Online Gambling Platform
There are some universal rules about choosing a good online casino platform, and it applies to those that run on Ethereum as well as those that simply accept it as a payment option. Let’s check them out:
Available Casino Games
Games are the reason why we join online casino platforms. Therefore, you should pay attention to the available games and their overall quality when selecting an Ethereum casino.
Make sure that there are enough games you like. For example, if you enjoy playing online slots and the casino offers only table games, you should probably keep looking.
Also, you should pay attention to game providers, as some of them offer better games than others. Casinos that feature games by industry-leaders such as NetEnt, Microgaming, Play’n GO, and others are usually a safe bet.
Welcome Bonus and Other Promotions
Playing games with more money than you deposit seem like something every casino player would like to do. That’s possible in the world of online casinos, as many offer lucrative welcome bonuses for new players. Most of them offer promotions for regular users too.
Pay attention to the type of bonuses that are offered. Once again, slot lovers prefer free spins over bonus money, so they should look for casinos that include free spins in their welcome bonuses.
Safety and Security
We already covered this bit. Here’s a short recap.
If a casino has a smart contract, safety and security are guaranteed by blockchain technology. However, lacking a smart contract (not being based on the Ethereum platform) requires the casino to be audited for fairness and have additional safety and security protocols to gain users’ trust. All casinos need licenses to operate on the web legally.
Customer Support
Customer support plays an essential role in online casinos, as players often need help when playing games. New Ethereum users often need further guidance about deposits and withdrawals, so it’s essential to choose a site with a helpful support team that’s available round the clock.
Banking Options
Ethereum casinos with smart contracts usually only accept Etheruem. However, the ones that aren’t Ethereum based accept plenty of other options. If you play games on the latter, make sure to check the other available payment methods, should you decide to switch at some point.
Alternatives to Ethereum Casino Sites
If you’re not satisfied with what Ethereum has to offer, you can always check out a typical Bitcoin casino. Bitcoin is currently the most popular cryptocurrency globally, and the selection of Bitcoin casino sites is much broader than Ethereum.
However, please take into account that casino platforms that use Bitcoin don’t use smart contracts. Therefore, the only thing that defines them as Bitcoin casinos is the sheer fact that they accept “digital gold” deposits and withdrawals.
Final Thoughts: What Makes Ethereum Such a Popular Choice for Casinos?
Ethereum is a company that’s actively researching the potential of blockchain technology. There are thousands of decentralized apps on the Ethereum platform, and casinos are very curious about using it to improve their service.
In other words, Ethereum and online gambling are a match made in heaven, but it’s still very early to jump to conclusions when it comes to mixing the two. Some platforms made a brave step forward and introduced Ethereum as a payment method, and a handful of operators even made their entire platforms Ethereum-based and provably fair.
Tags: Cryptocurrency | Ethereum
