The online gambling market is one of the fastest-growing industries today and is a form of entertainment that is set to continue rising. By 2025, it’s projected that the global online gambling market will surge to nearly $98 billion, increasing from over $57 billion in 2020. However, fuelled by the need to deliver provably fair gambling, blockchain sports betting is levelling the playing field for gamblers, while increasing accuracy and trust, boosting security, and improving efficiency for bookmakers across the sports, esports, and gambling sectors.
Blockchain Sports Betting is Putting Trust into Old Systems
As an innovative technology, blockchain first gained prominence when Bitcoin entered the scene over 12 years ago. Since then, blockchain, which is a distributed and decentralised public ledger that stores transactions in blocks on a chain, has been applied to many applications.
In a nutshell, each block contains a number of transactions, and each time a new transaction takes place, it’s added to the shared ledger. Every transaction is recorded with a cryptographic signature known as a hash, ensuring all the information is secure and immutable, making it almost impossible to change or hack the system.
And it’s because of blockchain’s secure nature, that the technology is offering a solution to provably fair gambling.
In the world of online gambling, questions as to how a game is provably fair have always been raised. Most law-abiding gambling operators tout their games as being fair, relying on random number generator (RNG) algorithms to ensure this is the case. Consequently, players are expected to trust these processes to get the gaming experience they want.
However, that’s not always the case. For instance, in 2011 Full Tilt Poker was accused of defrauding players of $300 million and that it was “a massive Ponzi scheme.” Betting fraud is a widespread issue, yet it’s also subtle and often not as hard to detect. Data manipulation in the gambling market is another issue that is becoming prevalent. With the current gambling ecosystem, data passes through several intermediaries where it has the potential to be changed.
By using blockchain for sports betting, it removes these issues as no one party owns the data due to its decentralised nature. Each time a transaction occurs on the blockchain, a record of that transaction is added to each participant’s public ledger. It’s due to the enabling of this immutable data that sportsbooks can ensure provably fair gambling.
In blockchain sports betting, this is how it would work for gamblers:
- You place a wager at an online sportsbook
- A network of nodes verifies to ensure that the bet actually took place
- Your bet is stored in a block, along with other bets, along with the betting amount and a digital signature
- The block then receives a unique hash enabling you to separate your bet from others
The advantage of this process means that once added to the blockchain, the block becomes publicly available so anyone can confirm the validity of the bet. It also ensures that human errors or mistakes are eliminated if bets are verified by a network of nodes rather than a centralised system.
Security is another benefit that blockchain can deliver to sports betting. Due to its decentralised nature, the technology removes the risk of a centralised failure or attack taking place. This is all thanks to the way blocks are stored and the hash code that identifies each block that makes it impossible to change without having to alter preceding blocks.
What Does Blockchain Sports Betting Mean for Your Gamblers?
In a nutshell, it makes the industry fairer for all gamblers. A well-known saying related to the gambling industry is that “the house always wins.” There is a belief that the gambling industry is unfairly balanced in favour of the house.
Through blockchain, trust is increased in bookmakers who are keen to ensure provably fair gambling is maintained on their platforms.
Gamblers that have increased trust of the gambling process means a win-win for all involved. Not only are gamblers spending money knowing the game is fair with no fraudulent transactions involved, but bookmakers are making money. As online gaming continues to grow, so too are permissionless systems, which are changing the way we achieve fairness.
Trust-based processes may have been the norm for most of gambling’s history, but that’s no longer the case. By removing these methods and putting decentralised technology at the forefront of this trust, fraudsters and scammers can’t cheat the system.
While there are measures in place to ensure gambling is as fair as it can be, these often fall short of the mark, especially when it comes to maintaining a bookmaker’s integrity. The advantages of using blockchain, aside from its transparency, as all transactions are visible on the ledger, is that a network of nodes verify the information, and that there is no single point of failure.
Thankfully, there are ways in which you, as a bookmaker, can get started with implementing blockchain solutions in your business. Protokol can help your organisation boost confidence in the gambling market with our fully customisable blockchain solutions for the sports and esports industries, which are easily integrated into your existing infrastructure. Created with highly adaptable blockchain technology, the solutions we offer are completely tailored to the needs of your bookmaking business.
Find out how we can help your company better connect with gamblers by improving confidence in gambling and making the industry fair for all involved. Why not book a consultation with Protokol to learn more about our blockchain development services or to find out more about blockchain technology and its impact on the sports industry.