The introduction of cryptocurrencies has resulted in a drastic change in the online gambling industry. Cryptocurrencies such as Bitcoin, Ethereum, Litecoin, Dogecoin, Tether, etc. allow users to bet on casino platforms. Crypto casinos are using blockchain technology to integrate cryptocurrencies with casino platforms. But the question is whether crypto casinos are more volatile than fiat gambling sites is rising nowadays. If you are familiar with cryptocurrencies, then you could know the answer to this question.
Simply, the answer is yes, crypto casinos are more volatile than fiat gambling platforms. In this article, we will discuss the reasons behind the volatility of crypto casinos and how this volatility impacts gambling.
Reasons Behind the Volatility of Crypto Casinos
We hope you know what is meant by volatility. Volatility in the context of crypto casinos simply means the fluctuations in the value of cryptocurrencies used for gambling. Let’s look at the reasons for this high volatility nature.
➡️ Relatively New Market
Cryptocurrencies were introduced to the market in 2009 by a group of programmers. It is still progressing and not every country accepts cryptocurrencies as a legal mode of payment. The relatively new nature can cause volatility and make it unstable. Also, it is working with a decentralized system, and no centralized authority is there to monitor them.
➡️ Market Sentiment
Cryptocurrencies are heavily influenced by the public audience, media coverage, and social media trends. Similar to the stock market, the value of cryptocurrencies will fluctuate according to market trends and news. Suppose there is a piece of hype news about a particular cryptocurrency, it will eventually increase the value of that coin. People will buy the coin without knowing anything about it and hoping the value will increase. But it can be false news and leads to severe loss.
➡️ Lower Liquidity
When compared to fiat currencies, cryptocurrencies have lower market liquidity. Also, cryptocurrencies have lower trading volume when compared to traditional assets. Minor market movements can have a large effect on their value.
➡️ Speculative Nature
Volatility can be increased by investors viewing cryptocurrencies as speculative assets and going after short-term rather than long-term profits. Trading habits are driven by fear and greed, which causes sharp price fluctuations.
How Volatility Affects Crypto Gambling?
The volatility of cryptocurrencies will also impact the crypto casino platforms. The fluctuations in Bitcoin, Ethereum, Dogecoin, Litecoin, etc. can influence the the overall gambling experience. The volatility affects the crypto gambling in the following ways:
Fluctuation in Value: The fluctuation in the value of cryptocurrencies is the main reason for volatility found in crypto casinos. A player’s profits as well as losses might fluctuate depending on the market value of cryptocurrency. For example, if you have won 0.1 BTC and its value is $3000 on the first day, on the next day it might be $2000.
Betting Amount: The actual value of bets might vary according to the rise and fall of cryptocurrency. Suppose you bet $0.01 BTC, which is $300 at the moment you bet, at the end of the day its value might be changed. It might be increased or decreased. The result of gambling can become unpredictable as a result of this fluctuation.
Psychological Impact: The player’s mind may be impacted by the volatility of cryptocurrencies. He/she will become fearful when found drastic changes in their bankroll.
Technical Issues: The casinos themselves face some technical difficulties due to the volatility of cryptocurrencies. Changes in the values may have an impact on the casino’s capacity to maintain its financial stability. It will result in the payouts and the reliability of the platform.
Tips to Overcome the Volatility
Utilizing the following tips will help you overcome the volatility issue with crypto casinos.
- You can use stablecoins such as USDT or USDC. These coins are stable similar to US Dollars. The value of these coins remains stable.
- If you need higher profits, try to withdraw your winnings when the value of cryptocurrency is higher. Do not wait for days hoping to increase the value. Withdraw as soon as possible.
- Do not focus on a single cryptocurrency. Try to use more than one cryptocurrency when depositing to the account. This way you can reduce the drop in value.
Also Read: Crypto Casinos Vs Fiat Online Casinos: What You Need To Know?
Conclusion
Because of the highly fluctuating nature of cryptocurrencies, the crypto casino platforms are more volatile than the fiat gambling platforms. This volatility can impact the financial outcomes, experience of players, and reliability of casino platforms. It completely depends on the players choosing crypto casinos or fiat casinos. Players looking for excitement and a larger winning amount could prefer crypto casinos. Players who value stability and consistency might be better off choosing a fiat gambling platform.
