Daniele Tagliarini, a digital payments expert and advisor, discussed the payment system tendencies in the global gambling industry. He shared his thoughts on the latest news in the financial and payment sectors of gambling.
Nowadays, in the digital era, the cash payment method is obsolete, and users choose credit cards for gambling more often. But are there any benefits in cash payment while gambling?
The usage of cash is tied to a “traditional” and still appreciated conception of the gambling experience. Playing, winning, and touch banknotes may be psychologically more satisfactory than having the amount credited to an e-wallet.
On the other hand, cash is being more and more subject to stringent regulatory requirements, and that is a trend that will continue in the future. Luckily, customers’ attitude has been changing in recent years, and online gambling has helped to boost cards and digital payments adoption.
Therefore “multi-channel” is today’s keyword in the gambling and gaming space when it comes to payments.
What are the safest payment methods in the gambling industry from your point of view?
Digital payments are much more secure than cash transactions, as they require proper verification and authentication. Also, they guarantee safe and contactless transactions, and we know how important is to avoid physical contact during a pandemic.
Some of the gambling regulators ban credit cards payment like the Irish Bookmaking Association has recently decided to ban credit cards. Will it influence the market and customers positively or negatively?
That is the approach of those who have decided that gambling needs to be a weaker industry, but there is no clear evidence of a direct link between the use of credit cards and the incidence of problem gambling. These kinds of choices may negatively influence the market as removing the ability to use credit cards would provide a competitive advantage to illegal gambling.
In my opinion, this is not the best way to solve issues related to the gambling industry.
On September 7th, El Salvador has become the first country where Bitcoin is the official currency. Do you think other countries will do the same soon?
I think this is an important sign to the “traditional” payments space and banks, not necessarily a best practice to follow. Cryptocurrencies have been traditionally associated with the concepts of unsafeness and uncertainty, but this narrative is no longer popular.
Today smart institutional investors and banks are entering the market and supporting crypto start-ups. I strongly believe the adoption of cryptocurrencies will help to accelerate the growth of digital payments.
The number of online casinos where a cryptocurrency payment method is available becomes bigger each year. Can the gambling industry completely switch to this payment method?
Years ago, a few online casinos created their own virtual currency and made it available to their customers as a closed-loop model. The advent of Bitcoin revolutionized that approach and cryptocurrencies are becoming more and more popular. Many don’t know it’s already possible to pay hotels and restaurants in Bitcoin directly, and cryptos will gain space even in the gambling industry.
That said, I believe the gambling industry will never switch to a 100% crypto payments model. Different payment methods will coexist, to guarantee customers a very flexible gambling experience. We will be able to pay with crypto, smartphones, e-wallets, cards, e-vouchers, and even cash, which will not grow but also not disappear completely anytime soon.
The whole process to pay with cryptos is fast and hassle-free, for the benefit of both customers and operators.
Cryptos are beneficial to those customers whose banks have policies that reject credit cards or wire transfer money from gambling websites.
Also, cryptos like Bitcoin are not subject to inflation, because the number of coins that can be issued is fixed, which is why many investors compare them to gold, and since the blockchain is a decentralized and public digital ledger, no one can freeze a customer’s account. Finally, no one can get to know how you used your coins and for what purpose, and we know that is an important factor for customers that do prefer to gamble anonymously.
As long as the number of customers using cryptos grows, more and more operators do favor the adoption of virtual currencies as a payment method. And as more and more cryptocurrency-friendly casinos emerge, more players do realize that they can use this payment method as well, it’s a virtuous circle.
What virtual currency is the best for paying in the gambling industry?
It’s important for the customer to use currencies that give guarantees, in short, medium, and long terms of security.
Bitcoin has been in the game from the start of cryptocurrencies introduction, therefore it is one of the most popular options when it comes to crypto payments.
There is no risk of disappearing any time soon due to its popularity and almost all online casinos and gambling sites do currently accept Bitcoin. But as long as other currencies – like Ethereum for example – become more popular, the situation may change.
Let me close by saying that the payments world is evolving very fast, and gambling companies need to gain specific competencies on how to leverage the opportunities the payments space is offering to guarantee their clients a satisfactory, flexible, immersive, safe, and compliant customer experience.
We all need to collaborate to make this transition from cash to digital as smooth and fruitful as possible.
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