- Legal States
Fiona Simmons March 15, 2023 9 min read
Web3 and iGaming – The Future?
The adoption of web3 is growing, with companies across a variety of sectors investing in this blockchain-based internet that incorporates cryptocurrencies, NFTs, decentralized finance, and more
With this in mind, what opportunities are there for the betting and gaming industry to become involved with what is being billed as the future of the internet? We spoke to several industry executives, to wit Dmitry Starostenkov, CEO of EvenBet Gaming, Daniel Heywood, CEO of NuxGame, and Suren Khachatryan, founder and CEO at Technamin to understand how web3 could shape the next generation of consumer engagement.
Q: What scope is there for the industry to become more connected with web3?
Suren Khachatryan (SK): Web3 has been making waves in our industry for quite some time now, but I think we have yet to scratch the surface when it comes to its potential impact. Crypto and blockchain are now key parts of many online gambling websites, and NFTs are becoming even more common. Outside of gambling, you have games like Minecraft and Fortnite which are actively making use of Web3 and related technologies.
Both platform providers and operators seek to create the ultimate gambling experience for the end users, as do game developers. With the advent of Web3, we will be able to achieve that goal and create more immersive journeys for players while each of us plays our respective roles.
Dmitry Starostenkov (DS): For now, a small one. Though web3 is a very prospective technological approach, it still has considerable limitations. It is not massively accessible as web2, demands a high level of user education, and still depends a lot on the existing centralised infrastructure. It will take quite a while for the verticals relying on the mass player influx, like sports betting or slots, to make such a transit. On top of that, there are regulatory issues based on procedures contrary to web3 principles, including KYC, user data stored by the operators, and affordability checks. From most of the authorities point of view, web3-based gaming is in the grey area or the worst case, illegal (for example, in the USA). This issue needs to be solved to provide security to the companies wishing to involve in this gaming activity.
Daniel Heywood (DH): One potential area for integration with web3 is through the use of decentralized finance (DeFi) protocols. DeFi protocols allow for the creation of decentralized betting and gaming platforms that operate on the blockchain, eliminating the need for intermediaries such as banks or payment processors. This can lead to faster and cheaper transactions, greater transparency, and enhanced security. Another area is through the use of non-fungible tokens (NFTs). NFTs can be used to represent unique virtual assets such as in-game items, collectables, and even land or property in virtual worlds. By integrating NFTs into their games, iGaming companies can create more immersive and engaging experiences for users, as well as new revenue streams through the sale and exchange of these digital assets.
Finally, web3 technology can be used to improve the fairness and transparency of iGaming using smart contracts. Smart contracts are self-executing programs that automatically execute when certain conditions are met. By using smart contracts, iGaming companies can ensure that games are provably fair and that payouts are automatically and transparently distributed to winners.
Q: How can web3 offer a different experience from what’s already available online?
DS: Web3 offers a new approach to many aspects of digital activities that we couldn’t even imagine during the early years of internet access. It looks like it can answer numerous tricky questions: for example, controlling digital identity and data, fair gaming transparency, and solving banking access and financial security issues. Strictly saying, web3 doesn’t change significantly any gaming experience. Still, it provides a new level of privacy and data control online that is highly important for competent online users who often worry about cases of personal data abuse, financial fraud, and other modern online gaming challenges and problems. The importance of personal data online security will only grow in the years to come, and for the iGaming industry, it is bound to become a massive issue.
SK: Firstly, let’s take a look at live casinos. These obviously strive to replicate the feeling of being in an actual casino, with interactive displays and live dealers. Now, imagine adding Web3 and other technologies such as VR and AR to the mix. The player will, quite literally, enter a world with which they can directly interact, especially if elements of in-game NFT purchases can be added. Additionally, they could communicate with other players in the same environment, which will introduce an added social dimension. From a player’s perspective, this is truly a next-level experience that would not be possible without technologies like Web3.
Aside from that, the blockchain and crypto technology which is attached to Web3 will play an even greater role when it comes to payments. Players now prefer security, speed, and anonymity with their transactions, and crypto provides all of them.
DH: Web3 is built on decentralized technologies like blockchains that can eliminate the need for intermediaries like banks, payment processors, or even iGaming platforms themselves. This can create a more decentralized and democratized gaming experience, where players have more control over their gaming experience and assets. It also enables greater transparency in iGaming by providing a tamper-proof record of all transactions on the blockchain, making it easier to verify the fairness of games and ensure that players are receiving fair payouts.
Allowing ownership of virtual assets, in-game items, skins, or even land or property in virtual worlds can provide a sense of ownership and investment in games. The incentive mechanisms it creates such as tokens or cryptocurrency rewards can motivate players to participate in games. Lastly, Web3 allows for interoperability between different gaming platforms and ecosystems, meaning that players can use their assets across multiple games or platforms. All of these different offerings provide greater flexibility and freedom for players and can also help to build larger and more vibrant gaming communities.
Q: How is your company looking to get involved with web3 and the crypto space in general?
DH: By delivering payment solutions to our customers, such as Solana and the Phantom Payment Extension, Petra the extension wallet of Aptos blockchain, Metamask, Trust Wallet and more NuxGame is demonstrating a commitment to providing users with a wider range of payment options.
Furthermore, as the crypto space continues to evolve, there may be additional opportunities for NuxGame to explore. We are developing a potential way of integrating NFTs into our gaming platform, which could allow users to buy, sell, and trade unique in-game items and rewards in the broader crypto ecosystem. Overall, by staying at the forefront of web3 and the crypto space, NuxGame can continue to provide users with a cutting-edge and innovative gaming experience. By exploring new technologies and payment solutions, NuxGame can differentiate itself from other iGaming companies and attract a wider range of users, thereby increasing its overall competitiveness and success in the industry.
SK: We are already active in the crypto sphere. Our casino and sportsbook products, for example, have recently been revamped to allow players to both deposits and withdraw using their cryptocurrency of choice. It supports a wide variety of currencies, including the most popular ones. Operators can leverage this to their advantage at a time when the market simply demands crypto.
In terms of Web3, we are in the research phase and will surely integrate that into our products as well. Innovation, after all, is a cornerstone of what we do here at Technamin, and we are always open to experimenting with new technologies. Web3 is something that we have set our sights on and it’s only a matter of time before we implement it.
DS: We’ve been working with crypto since 2014, so EvenBet Gaming was among the early adopters in iGaming. Our poker and gaming platforms already support using web3, and one of the web3-based projects using our software is in the pre-launch now. Due to the limitations mentioned, it’s not yet for everyone, but operators are already looking for web3 solutions; every project has its audience, and crypto enthusiasts or privacy-conscious users are creating a gradually growing segment of players.
Q: Is web3 the future in terms of engaging with the next generation of bettors/players?
DS: It is promising: the new generation of online users knows more about the importance of privacy and possible threats online. While involved in online gaming, they will pay close attention to providing any personal and financial data to a third party. It is a part of the industry’s evolution: in the beginning, users were ready to play just anywhere, now they are looking for fair and entertaining options, and soon, they will demand data and identity security guarantees. Web3 projects may give them such a level of safety.
SK: I believe that it will be a big part of this. Thanks to Web3’s capabilities, we will not only be able to engage players more effectively but also make their experience even more immersive and personalised. From a player acquisition and retention perspective, this will also start a whole new chapter. These technologies will have a significant impact on gamification tools and bonus engines, which will in turn positively impact the acquisition and retention phases as well. The sky is the limit when it comes to Web3, and we are all eager to both witness and tap into the full potential of this exciting phenomenon.
DH: Web3 has the potential to be a key technology in engaging with the next generation of bettors and players in the iGaming industry. The younger generation, which includes Millennials and Gen Z, is increasingly tech-savvy and interested in new and innovative ways of gaming. The decentralized nature of web3 can be very appealing to younger players who are interested in the value of digital assets. Web3 offers a range of features that could help iGaming companies appeal to this audience and create a more immersive and engaging gaming experience.
Web3 can also appeal to younger generations concerned with issues related to social responsibility and sustainability. Web3 allows for greater transparency in terms of the environmental impact of iGaming, as blockchain-based systems can be designed to be more energy-efficient and eco-friendly. This can help to attract players who are interested in gaming but also want to support companies that are socially and environmentally responsible.
The decentralized nature of web3 means that players can connect and interact with each other in more meaningful ways. This can be particularly appealing to players who are interested in gaming as a social and interactive experience. While it can be difficult to predict with certainty, companies that embrace these technologies and build more immersive and community-driven gaming experiences are likely to be well-positioned to succeed in the coming years.
Although Fiona doesn't have a long-spanning background within the gambling industry, she is an incredibly skilled journalist who has built a strong interest in the constantly growing iGaming network. The team at GamblingNews.com is glad to have her on our roster to help deliver the best stories as soon as they hit. Aside from writing, she loves to dabble in online casino games such as slots and roulette, both for her own enjoyment and also as research to better improve her understanding of the industry.