What is Bitcoin & Bitcoin Sportsbooks
What is Bitcoin and Why Should Sports Bettors Care?
Bitcoin (BTC) is a digital currency that was created in 2009 by an unknown person going by the name of Satoshi Nakamoto. There have been many rumors about the identity of the creator of Bitcoin. Most recently, Australian entrepreneur, Craig Wright came forward as the creator, but his case fell apart shortly after he made the claim.
It would be nice to know the man or woman behind Bitcoin, but it has changed the world of finance and money regardless. The crypto-currency is held and created electronically. Fiat currencies like Dollars, Pounds, or Euros can also be held electronically, but that’s where the similarities with Bitcoin end.
Bitcoin isn’t tied to any central bank or government entity. It can’t be debased through money printing, which is a tactic that almost all governments use to bring down national debt.
Instead, Bitcoin is created electronically. Each Bitcoin is “mined”, using a computer that is part of a larger network that anyone can join. The practice of Bitcoin mining is tied to processing transactions, making the Bitcoin network or blockchain an international decentralized payment network.
Best of all, sending and receiving bitcoins is free in almost all cases. Some charges can occur on some transactions, but these are a few cents at most, and they’re typically used to expedite a transaction.
If we compare the Bitcoin and the blockchain to traditional banking with fiat currencies, our current financial systems look downright archaic. Bitcoin offers the ability to transfer funds anywhere in the world faster and cheaper than any other method.
Best Bitcoin Betting Sites 2017
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Bitcoin and Online Sports Betting
A digital currency like Bitcoin doesn’t seem like a game changer for online sports betting, but that’s exactly what has transpired. The United States is still behind the times when it comes to sports betting. The only state that has full-scale sports betting is Nevada. In any other jurisdictions, the only option is unregulated markets.
The options in the offshore online betting world are still impressive, especially considering the United States government has been trying to take down betting sites that service American residents since the UIGEA was passed a decade ago.
In 2016, the government has made cracking down on illegal sports betting a priority. They haven’t hit any of the big offshore betting sites for years (and we hope it stays that way), but they do make it much harder for them to do business through banking laws that criminalize processing gambling transactions.
Bitcoin Changed the Way We Bet
That’s the main reason why Bitcoin has been a godsend to online sports betting markets and the online gambling industry on the whole. As mentioned above, bitcoins aren’t controlled by any major bank or government. They can’t be frozen or confiscated, which is not the case for bank accounts.
Bitcoin gambling sites are now a massive industry, with a significant portion of that coming from sports betting. In 2013, most betting sites that took Bitcoin did not accept fiat currency. The sportsbooks that took BTC back then numbered a lot smaller than they do today.
Popular Banking Method
In 2017, bettors will have a hard time finding an online sportsbook that doesn’t take Bitcoin. Many books are BTC-only, meaning that only accept Bitcoin and other crypto-currencies. Customers will make bets using bitcoins, and the funds won’t be converted to a fiat currency, like U.S. Dollar or Euros.
Of course, the most trusted sportsbooks in the industry now take BTC and fiat-currency. In this case, the sportsbook has a variety of cashier options. Bitcoins are converted to the currency of the customer’s choosing upon deposit. Once a payout is requested, they convert the funds back into BTC, and it is paid out to bettors.
Aside from keeping the money out of the government’s crosshairs, Bitcoin has many unique advantages compared to fiat currencies that make it the ideal currency for online gambling for both bookmakers and bettors. For more answers to common questions about bitcoin betting check out our Bitcoin FAQ page.
Additional Bitcoin Articles
Check out these other Bitcoin articles to find more useful information about what it is, how to use it, and the bitcoin sportsbooks that use this method.
- BTC Only Sportsbooks versus Fiat and BTC
- Using Bitcoin at Online Gambling Sites: Step by Step Guide
- Bitcoin FAQ
Bitcoin is the cheapest way to transfer funds around the world. The cost of processing Bitcoin is free which cuts down on withdrawal fees for both the sportsbook operators and bettors. This ends up being a massive positive for both bettors and sportsbook operators.
Other Methods Have Fees
For one, the costs of withdrawals aren’t pushed onto the bettors like they are with traditional currencies. Most sportsbooks do offer players a free payout every 30 days or each month via check, but any other payout requests will come with fees.
And, these can add up. After players exhaust their free payout, any additional checks cost $50 or more, regardless of the amount. Bank wires cost about the same, but extra banking fees charged to players make them a bit more expensive. Money transfers through services like Western Union and MoneyGram cost even more.
When it comes down to it, bettors are going to give up 5-10% or more of their winnings to payout fees. Most bettors understand the importance of line shopping but ignore the somewhat hidden cost of receiving payouts from offshore sites.
No Fees to Deal With
With Bitcoin, deposits are always completely free. Withdrawals usually are as well, but some operators may charge a conversion fee for withdrawals if they accept both BTC and traditional currency. The sites taking BTC-only will usually have no fees of any kind.
Bettors who bet with Bitcoin will still end up paying a few percent in fees, due to the exchange costs of buying Bitcoin and then converting it back to fiat currency. Still, the costs are almost nothing compared to the 10% or more that sports bettors will pay using fiat currency.
Transferring Bitcoins is a much faster process than any other payout method. Checks from offshore sportsbooks take at least a week to reach players, even from the most trusted and fasted paying sportsbooks. On the whole, the industry average is about two weeks. Bank wires are processed in about the same timeframe. Take a look at our monthly Sportsbook Payout Report, the fastest and cheapest option is always Bitcoin.
Bitcoin payouts are processed quicker than any other method. Some sites offer automatic withdrawals and players are paid in a matter of seconds. Almost all withdrawals with Bitcoin are processed in 24 hours or less. As sites get more used to dealing with BTC, sites and getting faster and faster.
Bitcoin is especially ideal for those who want to line shop but can’t keep large amounts in a bunch of sportsbooks. With any other payout method, they would have to wait a week or so for their funds and pay a fee.
Bitcoin lets bettors get their funds a lot faster (in some cases, a matter of minutes) which allows them to move money around to find the best prices far more quickly than they could using fiat currency.
Bitcoin doesn’t offer true anonymity, but the amount of privacy it offers compared to traditional currencies is worlds apart. The “know your customer” or KYC process is something that bettors need to do before they withdraw at most sportsbooks.
That process isn’t likely to change at some operators, but many of those that offer Bitcoin as a cashier option, especially those sites that are BTC-only, may not require any personal information.
In most cases, these Bitcoin sportsbooks only require a login and password. Many don’t even require an email address, let alone personal information, such as customers’ phone numbers or street addresses.
Get Started with Bitcoin Today
Bitcoin and the blockchain is a revolutionary technology. Sports betting aside, this is where the future of money and finance is going. Bitcoin may be intimidating for some, and there are a few small pitfalls to go along with its advantages, but using it as an online sports bettor is a no-brainer.
This is only an introductory article. We offer a lot more Bitcoin content, including a step-by-step process with images on how to buy bitcoins, store them, and transfer them in out and out sportsbooks.