If you’re reading up on cryptocurrencies and online casinos, you probably already know that there’s more to crypto than just Bitcoin. This guide on Ethereum gives you some handy facts about one of Bitcoin’s major competitors. We’ll also explain where Ethereum gambling stands, what to check before you use ETH at any gambling site, and where to buy it.

What Is Ethereum?

Ethereum is an open-source platform which allows developers to build applications, or Dapps, on its network. Currently in March 2018, Ethereum, or ETH, is the second-highest valued cryptocurrency after Bitcoin. In 2017 it peaked at over £1,000 per ETH, having started the year at around £7 per coin.

Is Ethereum Different to Bitcoin?

Yes. Bitcoin has one relatively straightforward ambition: to be the leading peer-to-peer payment method for digital currency transactions. Ethereum had the advantage of looking at what Bitcoin was doing right and determining what it could be doing better, then set about working on a new project. An emphasis on scalability, security, and the ability for anyone to build on top of the network is what separates Ethereum from Bitcoin.

One of Ethereum’s primary founders is Vitalik Buterin. In an interview in early 2018, he explained that he had never set out to create a project as large as Ethereum. But once he kept seeing areas for improvement, Ethereum grew larger and larger, and it is now viewed as a rival to Bitcoin. There are also thousands of ERC20 tokens available, all of which are built on the Ethereum network.

What Are ERC20 Tokens?

ERC stands for Ethereum Request for Comments. ERC20 tokens are built on the back of the Ethereum network, which is what makes them different from the vast majority of coins out there. Instead of having to create their own blockchain network, ERC20 tokens can take advantage of the ready-made solution that’s in front of them.

Because of this, the developers can spend their time focusing on one aspect they want to work on, or carving out a niche token. And among the many ERC20 tokens already in development, plenty are looking to complement the online casino industry, if they’re successful.

Do Casinos Accept Ethereum?

Bitcoin has been accepted at a growing number of crypto gambling sites, and the same can be said for Ethereum. There is an important split here, though. Many of the sites that take crypto are crypto-only operators without a licence in the countries their players live in. Licensed operators in regulated markets follow their regulator’s payment rules, and many of them do not accept ETH or any other cryptocurrency.

The number of online casinos which accept Ethereum is certainly smaller than those that accept Bitcoin. When this guide was first written in 2018, after a year of huge strides for crypto, many expected more online casinos to adopt ETH for deposits and withdrawals. Whether a given casino can do so depends on where it is licensed.

A number of gambling projects have been built on Ethereum itself. We don’t list or recommend ETH casinos on this page, because a casino that is not licensed in your country offers you no protection, whatever coin it takes. One project that drew attention in 2018, Virtue Poker, planned to put an end to long-standing fears about collusion and rigged games in the online poker world. It proposed a novel method of randomising cards that works very much like players at a table – each shuffling the pack and passing it on, with the whole process performed digitally. The project was even backed by the likes of poker professional Phil Ivey.

Ideas like this show what Ethereum’s smart contracts could do for fairness in games. A clever shuffle is not a licence, though. Any operator that takes real-money bets from you, on Ethereum or anywhere else, should be licensed by the regulator in your country, and you can check that yourself in a few minutes.

Where Can I Buy Ethereum?

You can buy ETH in many of the same places that you can buy Bitcoin, namely at a cryptocurrency exchange such as Coinbase or Binance.

If you’ve never bought a cryptocurrency before, you might want to check out our guide on how to buy Bitcoin. It walks you through the basics, and many of the instructions can be followed with just a few tweaks when buying ETH.

If you’re buying ETH with gambling in mind, read the section below first. The checks it describes matter more than which coin you choose.

Ethereum Gambling: What to Check First

There is no worldwide answer to whether online gambling is allowed. Each country sets its own rules and runs its own regulator, so start by finding yours and searching its list of licence holders for the site you have in mind. For example, the UK Gambling Commission keeps a public register of gambling businesses, and the Malta Gaming Authority publishes a licensee register with a URL checker. A site licensed in one country is not automatically allowed to take bets from another.

Licensed sites ask for proof of who you are. According to the UK regulator, online gambling businesses must verify your age and identity before you gamble. Paying in ETH does not change that, and an Ethereum address is not anonymous: every transaction on the network can be viewed by anyone.

The difference shows up when something goes wrong. At a licensed site you have a complaints process and a regulator behind it; in Britain the Gambling Commission explains how to complain about a gambling business. ETH sent to an unlicensed site has none of that. A refused withdrawal has no dispute route, your country’s self-exclusion scheme does not apply there, and an on-chain payment cannot be charged back.

Gambling With Ethereum Responsibly

You must be 18 or older to gamble, and some countries set a higher age. Keep the crypto you invest separate from any money you gamble with, and set your gambling budget in ordinary currency so ETH’s price swings don’t blur how much you are really spending.

If gambling stops feeling like entertainment, Gambling Therapy provides free advice and emotional support online to anyone affected by gambling, wherever they are. Your country’s regulator will also list local helplines.

References

• Ethereum.org, What is Ethereum?
• UK Gambling Commission, public register of gambling businesses
• UK Gambling Commission, Age, ID and financial verification
• UK Gambling Commission, Complain about a gambling business
• Malta Gaming Authority, Licensee Register
• Gambling Therapy