Legal rights of crypto gamblers vary from country to country. Check out the regulatory and legal status of your country before engaging in crypto gambling.
Today, cryptocurrency has become a popular decentralized currency across different industries, including the iGaming sector. Similar to most cases surrounding currencies and other developments, speculation and popularity go hand-in-hand. The legality of crypto gambling is a hot topic frequently in different countries. Casino operators who are starting their crypto casinos to provide the crypto slots and card games, for that matter, get confused by the ambiguous decisions and controversial facts of crypto gambling.
The operators have a great desire to run their business legally, and to do this, they try finding out if offering casino games on their crypto-gambling sites is legal and whether their platforms need to be regulated or licensed. Things are changing rapidly around the world, and it is difficult to identify the key global strategy. Every country has its trends regarding crypto gambling and providing the best crypto slot. In this article, we have thoroughly researched the regulation of different countries to determine the legal rights of crypto gamblers.
What is Crypto Gambling?
Crypto gambling involves playing online casino games and sports betting using digital currencies as a mode of payment. Cryptocurrencies provide multiple benefits to both casino operators and gamblers. Crypto gambling sites provide a digital environment where users can gamble using their cryptocurrency holdings.
Online casinos employing cryptocurrencies can be categorized into two groups:-
- Off-chain gambling sites that use centralized services usually employ a third party to allow fiat-to-crypto conversions. These platforms are easier to monitor for the regulators, and users are barred from joining the platform if there is ever a ban on gambling or crypto usage.
- On-chain gambling sites that use decentralized apps to operate. As a rule, these apps do not require user sign-ins or registration. Hence, they are difficult to monitor and track players on the platform.
Legal Status of Crypto Gambling
Coming to the regulation and legal status of crypto gambling, the activity is considered legal only if the conditions below meet:-
- A jurisdiction allows online gambling
- A jurisdiction allows the use of crypto within the territory
Let us now discuss crypto gamblers’ legal rights and gambling regulation on a country level.
Legal Rights for Crypto Gamblers
Here are some of the legal rights for crypto gamblers in different countries:
Gambling laws in the United States have not regulated or banned crypto gambling in the country. The US institution that takes care of the country’s financial regulation, FinCEN, has issued regulatory bills involving convertible digital currencies. Based on that Guidance, online gambling platforms that transmit money through CVC (Convertible Virtual Currency) are regulated under the Bank Secrecy Act as money transmitters. Every state in the US is allowed to introduce its regulations regarding using cryptocurrencies in online casinos. While the majority of the states prefer to limit or ban the use of crypto gambling sites, a few others, including Nevada, Michigan, Delaware, Connecticut, New Jersey, West Virginia, and Pennsylvania, have explicitly allowed crypto casinos to operate legally. Hence, if gambling in a particular state is legal, online casinos must obtain a valid license to operate illegally.
Coming to the United Kingdom, the UK Gambling Act does not include any provision related to crypto gambling. The UKGC (United Kingdom Gambling Commission) is responsible for regulating gambling activities, both online and offline, in the country. The UKGC considered using digital currencies in 2017, allowing casino operators and players to convert in-game items into money. However, facilities offering such crypto-gambling features needed to be licensed to operate legally. Additionally, if UK crypto gambling businesses want to accept digital currency as a mode of payment, they must comply with the AML obligations to act socially responsible. This means crypto gamblers in the UK can play games with digital currencies, provided that they undergo proper identity verification on their chosen gambling sites.
Canada is relatively strange regarding crypto gambling since the regulators are quite strict on local casinos. Every province in Canada has the right to manage and conduct gambling services. Although online gambling is illegal in many provinces in Canada, gamblers can use offshore platforms to play the best crypto slots using digital currencies. In 2022, the iGaming industry started to operate in Ontario, and the other provinces are most likely to follow in the footsteps of Ontario very soon. Irrespective of whether the casino uses fiat or cryptocurrencies to provide gambling services, it must comply with CFT/AML regulations, including using different verification procedures, such as KYC.
Asia, Australia, Africa, and South America
The crypto gambling scenario is similar in Asia, with the legality of crypto gambling wildly varying from country to country. While crypto betting may be regulated and legal in countries like Japan and many other countries such as China and Bangladesh, it is completely illegal for casino operators to provide gambling services using crypto.
Things are pretty straightforward in Australia concerning crypto gambling since the regulatory bodies and the government ensure formal regulations. The Government of Australia has taken a relatively proactive approach to regulating crypto gambling and online betting to protect its citizens and ensure that the crypto casinos in the country operate transparently and fairly.
Coming to Africa, some countries are allowed to provide crypto gambling services where players can wager freely using digital currencies; others have strongly prohibited the act. Online gambling is regulated and legal in South Africa. However, in Kenya, the legal status still requires clarification as the government needs to take more precise regulatory action.
South America is another country that has varying legal statuses regarding crypto gambling. Top countries like Brazil use protocols to regulate the operation of crypto casinos; therefore, it is legal to gamble with crypto. However, many other countries, such as Argentina and Bolivia, do not have any outright laws about the legal operation of crypto gambling sites. This leads to a problematic situation for punters as they are unclear about the rules and regulations in the country.
In conclusion, the legality of crypto gambling varies considerably from country to country. While some have well-established and clear rules and regulations, others have yet to consider the regulatory decisions around crypto gambling. Cryptocurrencies have undeniably grown exponentially in terms of popularity, and it is likely to grow further in the years to come. With this, more countries will begin to regulate the industry in order to protect their consumers and ensure fair and transparent operation of the industry. However, it is the sole responsibility of the gamblers to be aware of the regulation in their country and gamble responsibly before joining any crypto gambling site.