Ben Bernanke, the chairman of the Federal Reserve, stated that "Transactions and payments will continue to occur, but they will do so in ways that are different from those today. There is an interesting question of whether these new developments will enhance stability or whether they will introduce new vulnerabilities needing regulatory oversight." When we think of Bitcoin as a cryptocurrency and its subsequent blockchain technology, we can say that it fits in the form of a digital currency or digital assets. Blockchain is more of a technology rather than a currency and should indeed be celebrated and focused on more than just the Bitcoin price that cryptocurrencies offer. Blockchain technology disrupts the traditional financial system as it reduces friction, faster transaction time, and makes the transaction cost very low. Furthermore, this distributed ledger can also hold secure employment data to solve the unauthorized personnel databases some governments hold, replacing it with blockchain technology and as such giving millions of individuals a digital identity. These initiatives recently have now started and look very optimistic.
Casinos have been there for some time, and the internet has changed how people can have fun. As well, a little over the two decades, cryptocurrencies have come to change how the payment space operates. Blockchain technology has evolved side-by-side with cryptocurrencies and has been related only to cryptocurrencies. Such a limited view is not accurate, with blockchain technology permitting governments and organizations in almost every sector to reduce fraud, cost, and expedite transactions. This research serves to investigate how casinos in general, and in particular those casinos operating online, can benefit from employing blockchain technology.
2. Applications of Blockchain in the Casino Industry
No one could deny the role of the commissions that casinos usually charge for each withdrawal or deposit of money. But the current commissions could be much lower thanks to the blockchain, with the consequent savings for players and casinos. In addition to commissions, players must pay taxes in the casino where they play and we are only talking about legal money, since everyone knows that in all the countries of the world, there are casinos where you can play with illegal money. For those more fortunate countries, casinos have to pay huge amounts in taxes. The solution is not to pay taxes. Rather, the solution is in technology. The latest news in the world talks about QR codes that have photographs that could contain harmful programs for our phones. If the ticket that is introduced in the slot machine contained a QR code, at the time of cashout, it could infect the machine, getting the real money. With the blockchain improvements, tickets could disappear from slot machines forever.
One of the main characteristics of the Richard casino and casino industry is that it generates billions of dollars a year. However, the blockchain applied to this industry has great advantages not only for casinos, but for all people even if they are not players. One important aspect, but not the only one, of the casino industry is slot machines. There are people who travel around the world testing the same game and the differences between machines of the same game. Blockchain technology could help many game developers avoid that. Also, there are players who use rods to change the result of the game. This, in addition to being a lack of respect, is a problem for the players who are playing and for all the people who are waiting to play. If all the game data were stored on the blockchain, whenever a player uses a rod, he and the developers will be penalized at the same time.
3. Case Study: Implementing Blockchain at Richard Casino
The online gambling we studied is a centralized system in sharp contrast with the blockchain technology being part of the Richard Casino. The online casinos use proprietary software, making essential trust third parties for the generation of random numbers and the management of the credentials of the players that want to bet on a game. In addition, the prize to be won by the players is established by the amount of assets directly managed by the casino, and its transfer to the winners must be done once the dispute ends. The architecture of Richard Casino distinguishes three classes of entities: (i) information owner, typically the involved university, creating a game in order to use it for certification and making it accessible, allowing anyone willing to test a centralized version of it, (ii) the casino, having the role of a hodler and referee, and (iii) the players registering themselves at the casino and possibly applying for a certification that makes them knowing the crypto game involved.
Because blockchain technology operates as a decentralized and distributed database, it is considered ideal for improving the liquidity of online casinos by increasing security, transparency, and ease of access. This chapter gives an account of how some members of the Casino team, working under the coordination of the author, implemented a blockchain platform in the Richard Casino being tested within Casino. The software developer, two students from the Master in Innovation and Entrepreneurship, and Costas Mastropavlou had studied and worked with online gambling platforms and understood very well how Richard Casino could exploit the platform. Its architecture and some of its specific applications are described in the next section before we illustrate three of the other applications related to token incentivization, players' account management, and unalterable certification of expertise.
4. Challenges and Opportunities in Adopting Blockchain at Richard Casino
Given blockchain potential and functionality, all casino-level stakeholders can be somehow impacted. Furthermore, once blockchain is implemented within the casino operations, it has the potential of bringing more revenue to the casino, which would have a multilevel impact on the associated shareholders: investors, hosts and lobby hostesses, Keepers, and Platform operators. The main casino product, the game, is affected, which may lead to the emergence of new games, more entertaining and confused, to the development of communities and new players. In fact, the existing gaming experience may be tailored on blockchain technology, encompassing transparency, management, self-responsibility, and the gaming experience itself. The solutions offered by blockchain establish a profitable and sustainable business model, as well as solve the present casino problems and meet the casino future demands for operations as a business.
In order to make Richard Casino up to speed with blockchain gaming applications and platforms, it is necessary to deal with its specificities in terms of business assets and functions. The casino must acknowledge the complexity of adapting blockchain technology to its activities and also understand the technical constraints of blockchain capabilities, such as speed, scalability, private data (cards and customer personal data) access regulation, responsibility of the operators, and consequences of cybernetic attacks. Once these obstacles are overcome, the casino can remain competitive in the online and offline gaming industry, fully exploiting the technology behind blockchain and delivering the expected value to its customers, gamblers, developers, regulators, and organizations.
5. Future Trends and Implications for the Casino Industry
Blockchain on gambling market, the new emerging technology, is founded on the base cryptographic concept and distributed computing. It has been proved as a valuable solution for system integrity and trust issues. Through its key characteristics - decentralization, redundancy, and reliance on consensus - delivering the games via blockchain can provide a more trustworthy environment for both operators and players. In addition to that, blockchain can also streamline the internal operational processes, save running costs, and cope with cross-border compliance challenges, thus driving a smart future for the casino. What's more? The forerunner that can adapt to this technological revolution can definitely gleam the competitive edge in the market.
The casino industry is known for its conservative and labor-intensive nature. This paper posits that blockchain technology represents an important catalyst in transforming traditional casinos into smart casinos. It is believed that by embracing blockchain technology, the casino industry will definitely undergo changes in three different areas: core business innovation, internal operations, and regulatory management. In addition to enhancing the transparency and trust in traditional casino activities, our proposed solutions also address several potential challenges in the smart casino, including the fair computation issues in the blockchain, management of human resources, and establishment of multi-jurisdictional regulation authority in the smart casino ecosystem.