Cryptocurrency has exploded in popularity, and today, it’s possible to pay for more goods and services with crypto coins than ever before. Crypto makes transactions speedy and anonymous due to its decentralized nature, but crypto isn’t without its risks. These are particularly evident in the gaming space since online crypto casinos can magnify some of the challenges of using crypto.
If you are planning to use crypto for gaming, there are nine key mistakes to avoid:
#1. Not Accounting for Crypto Volatility
The top mistake many crypto casino patrons make is misunderstanding the level of volatility in the crypto market. The short version is that even if you win, you may lose if the price of the coin plunges.
As you likely know, cryptocurrencies can suffer through chaotic periods of extreme price fluctuations. Consider, for example, the cases of Ethereum and Bitcoin. During the second quarter of 2024, for example, Bitcoin lost 12% of its value, ending trading at around $62,734. But by December, it had soared to a record high of $100,000. These massive swings in valuation can heavily impact both your deposits and your winnings.
What this means is that on a bad day when crypto is losing value, you might win a lot in a game only to see the value of your gains evaporate if a token crashes before you can withdraw your winnings or convert them to fiat currency. On the other hand, in a period when crypto’s value is rising, you could see your gains grow markedly in value while you win. Either way, you need to be prepared for volatility and know when to convert your assets when coins’ values fall.
#2. Sending BTC to an Incorrect Address
It happens more often than you think! It can be all too easy to send BTC to the wrong place, due to such common errors as:
- Human error: Even a simple type in the address can cost you immensely.
- Scammers and phishers: Scammers may send you a fake address to trick you into sending funds.
- QR code errors: Altered or scam QR codes may misdirect your transactions.
- Lack of address labels: Confusion may arise when using multiple addresses without labels.
- Wallet problems. Occasionally, software or hardware glitches can display the wrong address.
- Unusual formats. Addresses that don’t follow standard conventions can confuse users into error.
Remember, Bitcoin transactions cannot be reversed, so if you send funds to the wrong address, they are lost. Be sure to:
- Check addresses before confirming a transaction.
- Obtain wallet addresses from official sources.
- Label wallet addresses to avoid mix-ups.
- Use small test transactions before committing to large transfers.
- Verify QR codes and be alert for phishing scams.
#3. Overlooking Regulatory and Legal Issues
Many people who wager in crypto casinos are looking to have fun, not to do the equivalent of a law school class in the legal landscape of cryptocurrency gambling. However, before you place a wager, you need to make sure you are familiar with the laws and the regulations in the region where you live. Some countries outright ban crypto gambling, and others have no specific regulations, which can put players in an ambiguous gray area. While it’s unreasonable to expect every player to have a law degree, you can take obvious steps to make sure you are using platforms licensed to operate in your country to ensure you don’t run afoul of anti-gambling laws.
#4. Not Making Use of Security Measures
Crypto casinos, like their real-world counterparts, need to be secure, and in the digital realm, that means protecting your digital wallet from hacking, among other measures. If your wallet isn’t secure or you are patronizing a weakly secured casino, you risk losing your crypto assets. At minimum, you should always patronize crypto casinos that have robust encryption and utilize two-factor authentication. Beyond this, you also need to be on guard for potential phishing schemes by making sure you use only secure, trusted platforms. Making use of published lists of the most secure crypto gambling platforms from trusted reviewers can help you make sure you are choosing the safest options for your wagers.
#5. Using an Unverified Crypto Wallet
Another related mistake is using an unverified crypto wallet or one that isn’t reputable when gambling. As most crypto users know, crypto wallets act as a bridge between the blockchain and the casino, but many users don’t know that not all wallets are the same. With the recent rush over the past year to launch new wallets, a number that lacked key security and reliability features flooded the market, increasing the chances of successful hacks or fraud. Always research a wallet before using it for any crypto currency. Choose widely respected, vetted wallets and avoid keeping large sums in hot wallets (those not connected to the internet) to reduce the risk of attacks.
#6. Wagering Too Much, Too Fast
This mistake isn’t limited just to crypto casinos but has been a staple of gambling for as long as gambling has existed. Players who experience losses try to make up for them by making ever-larger bets in the hope of winning big. However, this is more likely to result in growing losses. Always follow responsible gambling practices. For example, set a limit on how much you will bet in one session, or a time limit, and know when to cut your losses and call it a day.
#7. Choosing an Inappropriate Cryptocurrency
While it might seem like every cryptocurrency is interchangeable, that’s not the case. Not all of them are suitable for gambling transactions. Bitcoin and Ethereum are popular choices for gambling, but they have drawbacks: they are expensive to use, and when their networks are overloaded, transaction fees can soar. On the other hand, choosing less popular coins with lower liquidity can make it hard to cash out when you’re done. Stablecoins are often the safest bets, with the advantages of crypto but limited volatility. Some casinos will specify the types of cryptocurrencies they accept, so always check first.
#8. Not Understanding Wagering Requirements
Many players are rightly excited by bonuses, and bonuses are the major way crypto casinos attract new players. However, many players can become so consumed with the size of bonuses that they overlook the fine print, specifically the wagering requirements that they will need to meet before they can withdraw funds and realize any profits from their bonus wagers. Remember: Most, if not all, crypto casinos impose specific terms and conditions on the way you can use bonuses before you can withdraw your winnings. In general, a casino will either limit how much you can win using bonus money, require you to make a specific amount of wagering before you can claim any winnings, or both. Additionally, most casinos will also credit your winnings from wagers made with bonus money or free spins to your bonus balance rather than to your balance of real money until you have met all of the wagering requirements. Only then can you withdraw your funds.
#9. Using False Information to Register
Given the nature of the internet, it’s not surprising that a fair number of crypto casino patrons provide false information when they register, but doing so violates casinos’ terms and conditions and can lead to account suspension, casinos refusal to pay out, and even seizure of funds. So why do patrons give false information? There are a few key reasons: Many want to remain anonymous or get around restrictions on gambling imposed by their home countries. Some will create multiple accounts to try to exploit bonuses, while others may be using stolen credit cards to commit fraud. And, sadly, some problem gamblers will create false identities to circumvent self-exclusion measures.
Fortunately, these kinds of mistakes are easy to recognize and avoid. By following the rules and playing responsibly, you can have a safe and enjoyable crypto gaming experience.