Crypto VS Generic Casino. Which one is better to start in 2024?
Wondering which online casino to launch in 2024? With the success of stake.com, there are many business owners who want to start crypto casino. Currently, of the hundred businesses we work with, about twenty percent are crypto. Two years ago, this number was almost zero.
The vast majority of startups are still traditional casinos that also can process cryptocurrency transactions. The difference between a 100% crypto casino and a traditional one is huge. It’s like comparing a magazine and a book. Both products have to have a different approach to sell and appeal to a different clientele.
In this post, we will explore the pros and cons of starting an online crypto casino and a traditional online casino.
What is a crypto online casino?
A crypto online casino is an internet-based gambling platform that exclusively accepts cryptocurrencies (e.g. Bitcoin, Ethereum, Litecoin) for transactions, including deposits, wagers, and withdrawals.
It does not necessarily operate on blockchain technology. The main difference is the use of cryptocurrencies as the primary mode of payment and wagering.
Advantages of Starting a Crypto Casino
When you start a crypto gambling website, you get global access to the market. This completely changes your marketing strategy. Rather than concentrating on a particular region, you now have the option to select from two approaches:
- If you intend to launch a crypto casino targeting the global market.
- If your preference is to center your efforts on a specific country or region, such as the Indian subcontinent encompassing India, Bangladesh, and Pakistan.
Every successful startup needs to determine a country or group of countries or a specific group of people it wants to target. The reason is simple: you don’t want to get too bogged down. This means you need to localize so that all your messages and marketing activities have a clear focus and really resonate with your target audience.
Your own crypto casino also can focus on an English-speaking audience no matter where it is located. However, it’s important that you stick to the regulations. For example, no international license allows the US market. Even for crypto casinos.
That’s about 332 million people. According to Google, of the world’s approximately 7.8 billion inhabitants, 1.35 billion speak English. So you’re looking at another billion people.
The online gambling space is diverse and people familiar with crypto casinos have different perceptions, expectations, and behaviors. Combined with the global reach, it opens up a whole new world for any startup that believes in this target market and has a compelling offer and marketing strategy.
Benefits of Crypto Casinos
The benefits of crypto casinos are infinite. Here are some major ones we discovered after talking to several successful crypto casino owners:
- Cryptocurrencies are liked by people all over the world and allow you to connect with users from different countries without any hassle related to exchanging currencies. If your customers come from Sweden and use Swedish Krona, or from Turkey with Turkish lira, it doesn’t make any difference to them if they just need a bitcoin or USDT. Your players don’t have to worry about exchange rates because cryptocurrencies remain cryptocurrencies even if they’re used on Jupiter.
- Crypto-friendly players believe that crypto is the safest way to pay. It allows them to easily fund their accounts without worrying that their account details could be stolen and used by criminals to pay for the MacBook or anything else.
- People who value their privacy can enjoy gambling without worrying about being monitored or judged by others because their gambling activities remain private. Imagine coming from regions where gambling might be restricted – that’s tens of millions of people who don’t want your casino website name to show up on their bank statements.
- Withdrawals are processed almost instantly at major crypto casinos. After the dust settles and you’ve done everything you can to attract a customer, this is the most important part of building credibility and customer loyalty.
- You don’t have to deal with complex fee structures for different jurisdictions and multiple payment system providers. Just talk to multiple crypto payment providers about fees, pick one you like best, do the integration, and you’re good to go.
- You don’t need a dozen different payment system providers to serve people in different countries. Just one integration is enough, which simplifies the process and significantly reduces the time and effort needed to support the ecosystem.
- You can get a higher value from the players. Especially in low-income countries, as they believe these technologies provide a fairer gaming environment.
The Biggest Disadvantage of Crypto Casinos
It is much harder to advertise cryptocurrency casinos. Not all affiliates are designed for crypto traffic, which makes it more difficult to scale. By definition, all affiliates can attract generic traffic because most people pay with fiat money. If you try to drive generic traffic to a crypto casino, you will find that your registration to first-time deposit rates are low.
This is definitely not a good idea because you won’t be able to convert enough players to be profitable. Affiliates won’t be very happy either, because they could earn much more in a traditional casino with multiple payment methods.
Market Trends and Crypto Casino Growth
Every day more players are discovering the benefits of cryptocurrencies. Currently, there is a huge market and with more and more tools for crypto entrepreneurs, new opportunities are emerging every day. Check this article to learn how start crypto casino.
It’s a good time for hybrid ideas as the DeFi sector reinvents online casino platforms
The growth of crypto casino is not only fueled by the gambling industry. The rise of the DeFi (Decentralized Finance) industry is also pouring fuel on the fire and contributing to the growth of casinos using crypto solutions.
At the core of a DeFi casino is the use of smart contracts. In a DeFi casino, these smart contracts automate various aspects of gambling, including wagers, game outcomes, and payouts. This automation ensures that games are run fairly and payouts are made as specified in the contract code.
One of the main advantages of a DeFi casino is the transparency it offers. Game results are recorded on the blockchain, making it easy for players to verify the fairness of the games. Since all transactions are public and immutable, it is impossible for the casino to manipulate the results. This transparency creates trust among players.
The more transparency, the more trust. For any decentralized casino website, cryptocurrencies are the first choice as a payment method.
Some regulators ask too much from operators. An online casino is not an investment bank
What does an average gambler expect from a place like an online casino? Some are there for entertainment, others are on the hunt for riches.
Many people don’t want to share their personal information with a casino. “Why should I share my personal information with an online casino?” is a normal question we hear all the time.
Well, there is some truth to that!
It’s one thing to ask for your first and last name and even a copy of your passport to comply with AML policies. But it’s another thing altogether when regulators ask the casino operator to freeze a player’s account and demand proof of their income or source of wealth.
Although it may help to stop a gambler from losing money, therapy would be the real help here.
Instead of addressing the cause of the problem, these measures are only there to control the consequences.
Many people can’t get comfortable with the idea that they have to disclose sensitive information to online casinos. This is not an investment bank and they are not looking for a loan.
Some experts may say that we are taking these actions to help. We understand that. But they forget that this is not about us, but about people who really need help and do not resonate to such messages.
This is an important reason why most players choose traditional online casinos with international licenses or “bitcoin casinos”.
Such measures do not help online casino operators either. “Sharks” make 90% of the profit of any online casino. Regulatory measures that limit the amount or frequency of bets simply wreck the economy of online casinos. Especially startups that have to fight for every new customer.
There is a working trend in the gambling industry – entrepreneurs usually start in a gray area and work under international licenses to have a good chance of success. Then some of them try to find a way into a regulated market. If that suits their strategy.
The success stories of crypto casinos have attracted many new investors. For entrepreneurs who are already familiar with the crypto industry, it is much easier to get investments from market participants they have probably known for years.
Crypto venture capital funds and crypto-friendly angel investors are willing to invest in good ideas and well-organized teams. And if there is a demand, there will always be a supply.
Advantages of Starting a Generic Casino
Considering all the advantages of crypto business models, it is also important to talk about traditional online casinos.
The online gambling business is growing rapidly as more and more people gain access to the Internet. The potential is huge.
The latest data from the International Telecommunication Union (ITU) shows that by 2023, 2.85 billion people in the world will still not be using the Internet. This shows that there is still a lot to be done to achieve the goal of “universal access”.
The quality of individual Internet connections is a crucial factor that must also be taken into account – it’s difficult to play games with a dial-up connection.
There are great opportunities in emerging markets such as Latin America, Southeast Asia, Africa, and the Indian subcontinent.
Cryptocurrencies, NFTs, and metaverse are completely nonsensical for people who only have cash and use traditional payment methods. People in such regions do not look for fancy designs and have a very different idea of how a normal online casino should look like.
In more developed countries, there is still plenty of room for traditional online casinos due to stable economies, traffic sources, and product innovations.
Benefits of Generic Casinos
- It’s much easier to promote traditional online casinos. Every iGaming conference attracts tons of affiliates from all over the world. You can open Google, type in the most competitive keyword and find tons of affiliates in every region. You still have to do the work, reach out and close deals.
- In other words, you don’t have to do the impossible and create a marketplace. It’s already there and affiliates are the best indicator of success for any business.
- Just ask if you see affiliates in the market of your choice. If your answer is “YES”, then there is a market for your business. If the answer is “NO”, then there must be a reason why people don’t want to risk their money and build traffic there.
- Affiliates focus on specific countries and are looking for operators and the best deals. Your job is to find affiliates with whom you can make a deal that is profitable for all parties.
- It’s true that a crypto-friendly audience trusts crypto casinos more. But it’s also true that people who have never worked with cryptocurrencies don’t believe in them and don’t see them as a legitimate currency. For them, the “bitcoin casino” is just another Ponzi scheme for them. Our point is that there are hundreds of millions of people who trust traditional casinos more. They use local payment methods or well-known and recognized card providers like Visa or MasterCard.
- Traditional online casinos can focus on a single country or even a small region and be successful. This is the strength of well-localized solutions.
- If the numbers are right and you’ve researched the market well, you can even focus on one city. If there is Amazon or Netflix, that means there are enough people who know how to use online payment methods.
- Traditional casinos are easier to start, especially if you have a limited budget. All you need to do is focus on emerging markets rather than tier 1 markets like the US or UK. The cost per acquisition is much lower in growing markets. This gives you an advantage when testing different marketing strategies – instead of spending EUR 100,000 on different tests, you can spend EUR 5,000 to see if something works.
The Biggest Disadvantage of Generic Casinos
Definitely payment systems. In different countries, people have different ways they want to pay. In India it’s UPI, in Brazil it’s PIX, in the U.S. it’s Paypal or credit cards.
A payment system provider can only offer you one or two payment methods per country. That means you’ll need a handful of different PSPs to accept payments in your chosen GEOs. Large online casinos have dozens of different payment system providers for every situation.
Imagine if one payment system provider can’t process transactions for thirty minutes. That can mean hundreds of thousands of dollars in lost revenue. Integration and smart maintenance are necessary to ensure the best experience for every player and uninterrupted cash flow for your business.
Also, certain payment methods require more complex business structures that can increase your expenses and taxes.
Competition and Market Potential for Generic Casinos
Competition is good. Only people who don’t understand business are afraid of it. Competition means that the market is healthy enough to start the business. It drives innovation at all levels, from online gambling platforms to payment system providers who need to offer people more convenient and affordable ways to pay for services.
If you want to start a successful online gambling business, the best thing you can do is to get to know your competition instead of trying to enter the market without them.
It’s all about the product, the angle of your business, and the marketing approach that will determine success. With the growing number of iGaming professionals, starting your own business has never been easier.
If you can’t decide whether to start a crypto casino or a traditional online casino, think about the market you want to enter. Both business models have advantages and disadvantages. It’s impossible to say that one is better or worse than the other.
Nowadays, there are traditional casinos that offer crypto payments and crypto casinos that offer fiat currencies (stake.com is just one example).
Before you decide on the market you want to enter, you should define the value you can offer to players and consider your budget to achieve your goals. Of course, you must also consider your own expertise. This simple exercise will lead you to the answer of which casino you should start.
- Crypto casinos, which are characterized by accepting only cryptocurrencies for transactions, offer a number of advantages. These include global market access, which allows you to tailor your strategy to a worldwide audience or focus on specific regions. Cryptocurrencies offer ease of use, increased security, privacy, instant payouts, and simplified payment systems. They also tend to attract players who believe in the fairness of technology and can offer higher lifetime value from customers, especially in low-income countries.However, crypto casinos face challenges in advertising and attracting visitors, as not all affiliates are equipped to serve the crypto audience. This can affect scalability and profitability compared to traditional casinos.
- On the other hand, generic, traditional casinos have their strengths. They are easier to promote thanks to a well-established network of affiliates. Traditional casinos have the trust of people who have never worked with cryptocurrencies before, and they can focus on localized solutions for specific countries or regions. Their ease of entry, especially in emerging markets, can be cost-effective for startups.