A successful application for bitcoin is in online gambling. Therefore, any changes to gambling regulation are bound to affect the demand for bitcoin.
Right now, many countries in Europe are making changes to their gambling regulations to protect their residents.
Nevertheless, the new laws may actually increase the demand for bitcoin, making it even more popular. To see how this is happening, let’s look at some of the changes in gambling regulations.
Only the largest markets will have an impact on cryptocurrency rates and its usage in various online bitcoin casinos which have been increasing their popularity.
Countries where gambling regulations are changing
This year, at least three countries have changed their gambling regulations. These are Poland, Netherlands and the Czech Republic.
These and other countries in the Eurozone are making it harder for gambling companies to operate within their borders, and their regulations are pushing out even the largest gambling companies. In these countries, all gambling operators must be licensed by the local gambling regulator, but their harsh laws are making it very difficult to operate.
In Poland, for example, they are doing so through an increase in taxes, which has now reached 12% of the total turnover. This is a very high figure for a company to pay in taxes just from its revenues, and it is making the Polish market unfavorable. Already, some major gambling companies like Bet365, 888 casino, William Hill among others have left the Polish market, mainly due to the high taxes. Add to that, the government requires that the gambling companies employ local staff recommended by the local gambling establishment.
Besides these major companies, unregulated operator domains have been banned, and these have already been excluded from the Polish market. However, the case is a little bit different with many unregulated bitcoin casinos, especially when it comes to deposits. While a government can easily ban deposits in fiat currencies to unregulated entities, it is nearly impossible to do so when bitcoin is used for a deposit.
In the Czech Republic, they are using taxes to limit unregulated gambling activities by imposing the highest tax rates. Every game that randomly generates a winner will be taxed at 35% from the gross revenues earned. Then a further basic 19% comporate tax is also be imposed. These are some of the highest rates in the Eurozone, and with two rounds of taxation, they have become highly unfavorable. Various gambling operators have already exited the market there, while unregulated operators have had their IPs blocked.
Besides these regulations on brick-and-mortar gambling companies, even the iGaming industry is under attack across Europe. Unregulated operators’ IPs are being blocked, while payment system providers are also being asked to block the accounts of unregulated companies from accepting deposits.
How these regulations will affect bitcoin
These changes in gambling regulations across Europe are having a seriously negative impact on the industry as a whole, and the operators have had to find alternative ways of survival. One main way is to use bitcoin, which keeps the identity of the gamblers anonymous and bypasses state regulations.
This is also perhaps going to be the main way operators stay afloat because the regulated entities are having a hard time making profits. Therefore, more gambling operators may opt for bitcoin, which is going to increase their profits. Even the gamblers themselves may prefer to use bitcoin, since it also safeguards their interests.
All in all, the gambling regulations being imposed in Europe could increase the demand for bitcoin even further.