The Rise of Stablecoins Casinos: Are Stablecoins Dethroning Bitcoin?

Crypto gambling has been rising in recent years despite many challenges and threats of heavy regulation of these digital assets. The past year, 2024, proved incredibly lucrative for stablecoins, allowing crypto users to explore many new landscapes, including online gaming.

Alongside other platforms, many casinos have jumped on the bandwagon and followed the stablecoin wave, prompting Crypto Gamba to wonder whether stablecoins like USDT (Tether) and USDC (Circle) will become the new Bitcoin of the iGaming world. We’ll dive deeper into stablecoins, their sudden growth, and future predictions to find the answer.

Behind the Curtain: Growth and Purpose of Stablecoins

As a response to the main downside of crypto – volatility – a new idea emerged: digital currencies tied to reserved and stable assets like fiat currency, a.k.a stablecoins. Eliminating the obstacle many have deemed the downfall of digital coins, casinos and other establishments have happily accepted this new way of payment, now more than ever.

Stablecoins are typically pegged to an asset with a stable value. For example, Tether is linked to the US dollar, meaning 1 USDT equals 1 USD. Moreover, some stablecoins, including Tether and Circle, are backed by financial assets like bank deposits. This is a major advantage for casino players, who know precisely how much they’re spending and don’t have to worry about crypto's constant fluctuations and price changes.

Stablecoins: A Short History

First showing up in 2014, stablecoins have grown to hold 8.2% of the global crypto market cap, according to some reports. Although not reaching a smidge of what the most popular cryptocurrencies hold, the slow rise of this asset is not to be dismissed.

Stablecoins emerged to counter the inadequacy of the traditional financial sector. To be more precise, their development was motivated by the need to mitigate unbanking limitations. Crypto exchanges decided to bridge the gap by setting up a middleman responsible for accepting money from one side and converting it into digital assets while keeping volatility at bay.

Thanks to the rise of DeFi and changes in the reserve management strategies linked to stablecoins, these assets rose in popularity. Simply put, in 2019, stablecoin issuers diversified their linking assets, meaning that stablecoins, for the first time, were pegged to debts, commercial papers, treasuries, etc.

This led to a big jump in value, amounting to $181.7 billion, in 2021. However, the following year saw a downturn for these digital coins, courtesy of Terra’s collapse. Nonetheless, stablecoins climbed the ladder again, reaching a $161.2 billion market cap in 2024.

Why Stablecoins’ Popularity Grows in Casinos Worldwide

The popularity of stablecoins is evident, but why are casinos increasingly accepting these digital assets? Here are the main reasons why players find stablecoins to be more beneficial.

Stability

Being linked to a real-life asset means stablecoins are less volatile than other cryptos. Unlike BTC, which can follow big surges and huge downfalls, stablecoins keep a constant value (for the most time).

This stability has enabled some coins to keep their value for several years. USDT and USDC are the most prominent players in the game, holding around 70% of the stablecoin market out of 200+ digital coins pegged to the US dollar. As for casino players, stablecoins’ stability allows them to keep playing without worrying about losing their money’s worth in a matter of seconds.

Enhanced Security

Every cryptocurrency has enhanced security. Most stablecoins run on the Ethereum network, which provides users with secure transactions on a transparent, decentralised ledger. This is a big plus for players at Tether casinos, as they don’t need to provide their personal information when playing their favourite games.

Faster Transactions & Lower Fees

Being a digital asset also means stablecoins manage all casino transactions in several minutes. Deposits and withdrawals can be made by simply copying and pasting the address of your crypto wallet.

Furthermore, they offer lower fees than traditional banking options. To top it all off, it’s not uncommon for crypto casinos to link some promotions to USDT transactions.

Globally Accessible

Stablecoins can be used to play at a crypto casino regardless of where you are. Considering crypto regulations are still in their infancy, gamers can transact with these assets irrespective of geographical and regulatory barriers. Plus, what makes stablecoins so attractive is that you are essentially playing with USD, even though your native currency may be entirely different.

The Dark Side: Stablecoins Challenges

Stablecoins sound like an exceptional addition to online casinos, but some challenges exist. According to some reports, stablecoins have surpassed the cybercriminal rates of Bitcoin and are now the preferred medium for illicit transactions.

This only highlights the need for regulatory frameworks for the asset. That said, we can’t ignore the fact that the first steps have already been taken. In 2023, Singapore announced a new regulatory framework that includes stablecoins. The UK has also been making progress, announcing a new framework for issuing and custody of fiat-backed stablecoins.

But would this pose a problem for online casinos? Hardly. Since stablecoins already act like fiat currencies, regulating them can increase casino players' safety while maintaining the advantages of decentralisation.

The Future of Stablecoins: Is This the Bitcoin End?

With the increasing development in the crypto realm, the question that comes to mind is: will stablecoins outgrow Bitcoin?

Although generally stable, many still fear a potential crash, like the one that happened with Luna in 2022. The situation was a bit different, though, as the coin collapsed after losing its peg to the dollar. On the other hand, external factors influencing the world's macroeconomic stability are more prominent potential threats to this digital asset.

However, following the growth of these coins and the desire to fully regulate them to ensure their maintained stability, many are optimistic about the future of stablecoins. That being said, surpassing Bitcoin or Ethereum is still nowhere in sight—the giants are here to stay, only supported in their decentralisation journey by stablecoins like USDT and USDC.