How will Cryptocurrency’s growth change Esports Betting
If we were to pick two things that made headlines towards the end of 2020 and into 2021, they would be esports and cryptocurrency. It seems that the two have been more and more prevalent in the mainstream media as the worldwide quarantine continues to change our lives.
How do they two work together, and why have they become so popular?
Esports, Betting and Cryptocurrencies
Esports, Betting and Cryptocurrencies are all touching the same target demographics and the connecting between the three industries is strengthening year upon year. Only a few years back, we talked about cryptocurrencies and esports as a vague concept that is not moving forward. Nowadays, high prized Bitcoins, NFTs and Fan Engagement Tokens are slowly becoming the standard, while games like Lightnite and SatoshiQuestMC make novelty approaches to how Bitoin intersects with video games.
Esports are also pushing cryptocurrencies into the mainstream, blockchain technologies and platforms like Socios are helping teams launch Fan Tokens and generate engagement and revenue in the process.
Finally, betting markets and bookmakers are opening up to crypto betting daily as the value of currencies skyrockets. Some operators like Stake.com even work exclusively with cryptocurrencies as their deposit method. There is even a special Bitcoin betting section on our page to cover all the operators joining in on the trend.
Overall, these three industries are intertwining at an exponential rate, raising questions about legality, regulations and sustainability. The meteoric rise of altcoins like Dogecoin, Ethereum, Litecoin raises questions about valuation and how to manage an increasingly complex market.
Esports betting is the industry most concerned, with daily value shifts, legality and availability becoming the main issues.
How does cryptocurrency esports betting work?
The popularity of cryptocurrencies has grown side-by-side with that of esports, leading to several esports betting websites accepting cryptocurrencies like Bitcoin on their platforms.
One of the reasons for the symbiotic relationship between esports betting and crypto is the demographics they attract. According to Millenial Magazine, “over half of all Bitcoin owners are between 18 and 35.” This age group also coincides with the vast majority of esports fans and players. That age group also tends to be fond of gambling and betting, so combining two things they like can be a recipe for success.
Sportsbooks that offer both esports betting and the ability to use crypto in those bets have tapped into a whole new market that is very different from the traditional betting audience. The fact that crypto is decentralized can also be a factor that attracts esports bettors, since they can place wagers without their banks rejecting their bets.
According to The Sports Geek, “Americans especially have a tough time making esports bets, because they must deal with the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006,” which “prevents gambling businesses from accepting payments related to unlawful online betting.” With crypto, there is no way to trace payments opening an avenue bettors bettors and markets previously closed to them“.
What will happen as cryptocurrency continues to grow in value?
Cryptocurrencies have grown exponentially over time, especially in 2020/21. Bitcoin hit a record high of $50,000, especially as Tesla invested $1.5 billion into it. As the value of Bitcoin and other cryptocurrencies grow, we could see a growth in their prevalence in esports betting. Early investors who also happen to be fans of esports could grow their investment by betting on esports matches.
The growth of esports and crypto could also attract bettors from outside the esports bubble, who are not as familiar with how the space works and are only looking to make money from it. This growth would be beneficial for sportsbooks that support esports and crypto, but fans might see it as an invasion by people who don’t belong in their tightly-knit group.
That said, the value of cryptocurrencies is very volatile, with sharp dips happening all the time. This uncertainty could turn some people off from using crypto in esports bets since there is no guarantee that they would get back as much money as expected.
Will we see new crypto betting regulations come into effect?
Much like Valve sought to regulate CS:GO betting after they caught fraudulent websites, esports crypto betting could see some regulations soon. These regulations would seek to protect the bettors, the sportsbooks, and the players themselves from fraudulent bets and crypto volatility.
This outcome is as unsure as to the currencies’ value from day-to-day. If the symbiotic relationship of the two continues to grow, however, it could become a reality. Seeing how unregulated CS:GO betting affected the community as a whole, these regulations should be welcome by those who want a fair playing space for all.