The pros and cons of blockchain technologies
Kostas Farris, CEO of blockchain lottery operator and platform provider, Quanta, talks honestly about the upsides and downsides of operators embracing the technology.
n recent months there have been sensationalist headlines about how blockchain is going to revolutionise the global online gambling industry, urging operators to embrace the technology without delay.
While blockchain will most likely over time play a more significant role in the sector, and may even become the platform of choice, for now it remains a new technology that operators and suppliers are still trying to fully understand.
Blockchain undoubtedly offers tremendous upsides to online gambling operators and suppliers in the long run, but for many the risks of migrating to the technology simply outweigh the perhaps limited rewards at present.
It is a situation about which Quanta has unrivalled insight in and experience of as we are the first and only licenced blockchain lottery operator in the world. Naturally we believe the technology is game changing, but we are also realistic about the challenges it creates.
Below, I outline the pros and cons of online gambling operators using the blockchain to power their sites, either entirely or in part. First off, let’s discuss some of the difficulties it can present.
CONS: 1 Perhaps the biggest difficulty at present is
distinguishing the blockchain from
cryptocurrencies such as Bitcoin and Ethereum. The negative press surrounding crypto is having a knock-on effect to the technology, which is very separate from it.
For operators considering embracing the blockchain, player perception and trust is a major factor. While the technology offers superior levels of transparency and accountability, it remains a hard sell.
For many the risks of migrating to the technology simply outweigh the perhaps limited rewards at present
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industry, we have yet to reach a critical mass of blockchain adoption. There are a growing number of businesses working with the technology, but it has yet to truly enter the mainstream.
2 Both inside and outside of the gambling
This can make organisations that do invest in the technology feel like they are swimming against the tide and taking a big risk on embracing blockchain before it is proven in not just their sector but others.
starting to see big-name entrepreneurs and businesses show serious interest in blockchain, such as
3 Leading on from the above, we are only just
Most of the cons surrounding the blockchain come from a lack of understanding about the technology
some of the world’s leading banks that have started to invest in the technology.
Such figures and organisations are often used by smaller companies as a barometer for what will and won’t work in the future, and their late arrival to the blockchain scene has slowed down its adoption.
PROS: 1 The biggest upside to the blockchain is the
unrivalled levels of security, integrity and transparency that it offers over traditional technology platforms. Players can actually verify the outcome of every single bet and wager.
In addition, all transactions are recorded on the blockchain so players can be 100% certain that the online gambling site is operating to the highest possible standards.
such as the incredibly low cost of processing payments and the speed at which withdrawals and transactions can be processed – either with crypto or digital currencies.
2 For operators, there are also financial upsides
new players in developed markets, including the highly lucrative millennial demographic that don’t trust legacy game operators.
3 The blockchain also helps operators to attract
Moreover, in new and emerging markets such as Africa blockchain game operators could attract many new players because in these regions, the blockchain is actually trusted above and beyond traditional platforms and local supervisory authorities. It is clear, then, that most of the cons surrounding the blockchain come from a lack of understanding about the technology, and the fact it has yet to enter the mainstream. All that is required to overcome this is an education process.
Here at Quanta we are positive proof that the blockchain can be used to successfully launch an online lottery, and we are more than willing to play a key role in spreading the word about the incredible potential it offers.
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