The Risks and Rewards of Gambling with NFTs and DeFi Tokens
In 2024, crypto gambling is one of the most popular ways of wagering online, but that doesn’t mean it’s the only innovative way of playing. There are other options along with crypto gambling DApps, and some of them even include wagering NFTs and DeFi tokens.
So, our team will delve deeper into gambling with NFTs and DeFi tokens as go through the unexplored territory that’s likely yet to rise in the iGaming scene. We’ll talk about some of the main benefits of these sites, and how they work, but also about what you can expect in short-term benefits from NFT and DeFi gambling sites.
Understanding NFTs and DeFi Tokens
Both NFTs and DeFi tokens operate on a decentralized network run through blockchain technology. While on one hand, we have DeFi as a system based on which crypto gambling works these days, NFTs are a bit more narrow in terms of their meaning.
They only include non-fungible tokens which have a set value encrypted in the blockchain and the value is dictated by the market. So, one could say that there’s some basic trading and “supply-demand” concept going on here, and that’s precisely what drives the value of these tokens for online gambling.
Along with NFTs, we also have DeFi as a concept based on which the decentralized financial system works in the first place. However, there’s one catch with these two terms – there aren’t that many gambling platforms that accept these tokens as payment methods as of now.
Hopefully, the year 2024 will open some new doors toward DeFi betting and NFT gambling sites and lead to them being more widely accepted, so we’ll go over the basics in the rest of this guide.
The Attraction of NFTs and DeFi Tokens in Gambling
So, if you are new to these terms, you may be wondering – what value is there behind NFT and DeFi betting sites and platforms? Well, let’s put it this way – it’s the decentralization that makes the most sense for these tokens to be used in online gambling.
We already have plenty of crypto gambling sites, but DeFI payments can run faster on DeFi networks and they can make the whole process of visiting the crypto exchange and having a wallet way easier.
Plus, NFTs are simple and easy to use for deposits on sites that already accept them, since there’s an encrypted value assigned to each token. This way you can be sure that the value of your token will remain the same throughout your gambling experience.
Of course, there’s a market for it and that makes the value fluctuate in some specific scenarios, but that’s not necessarily a bad thing. In fact, it can be a great thing as you can gamble to win more valuable NFTs than those that you already own.
As for using convenience, it’s pretty much the same as using crypto. You can make fast and almost instant deposits and withdrawals without any fees and extra payments being associated.
There’s no need to sign up on the site using your real credentials and personal details, so you can keep your information safe in that sense.
Plus, NFT and DeFi payments are safe and secure since both the value of the tokens and the transactions themselves are all written into the blockchain and that makes things much easier.
There are also benefits for the operators in this case since they can act as decentralized casinos and won’t require any extra authorization or governance in this case. They can run blockchain-based gambling software and all that leads to lower costs for the games and bigger bonuses and higher RTP rates that they can offer to players in return.
Risks Associated with Gambling Using NFTs and DeFi Tokens
While there are numerous benefits of gambling with NFTs and DeFi tokens, there are also some uncertainties and risks. These are associated with the legal side of the story and regulations, but also with the volatility of the market.
As we already mentioned, the NFT and DeFi market is constantly changing and that volatility doesn’t work well for online gambling. However, that’s also the case with crypto and it works in that case, but there’s a huge difference here.
Crypto is well integrated into the iGaming scene now, while there’s only a handful of sites that take NFTs and DeFi tokens for online gambling. There’s also a lack of regulation at work, and by that, we don’t only mean the legal stuff.
It’s also the lack of regulations on casino sites that accept these tokens since there’s no clear plan on how to proceed in certain situations (like when the NFT’s value changes for instance).
All of these risks can dictate how the market continues to develop and how it proceeds when it comes to accepting player’s tokens for bets.
Rewards and Advantages
Because of the decentralized nature of NFTs and DeFi tokens, they come with a lot of benefits for online gambling as well. We’ve mentioned a few but now we’ll focus on the main benefits in more detail, and decentralization is surely among the most important ones.
It allows players to reap the rewards in terms of more gambling freedom and a higher variety of games offered. You can find a lot of provably fair games available on NFT and DeFi betting sites, and that’s not even all that matters from this perspective.
It’s also important to realize the security aspect of decentralization and how it leads to safer gaming since you don’t have to share any of your personal information online.
Along with all these, there’s also the matter of higher returns since some decentralized casino games offer an RTP rate of up to 99%, which is higher than traditional online slots and live dealer games. So, you also have higher winning chances as the bonus offers are also better, keeping in mind the low cost of game production on blockchain and no connections with large operator brands.
We also have to discuss the NFT ownership and rarity which can be pretty expressed when it comes to the value of your gambling bankroll and budget. Precisely, the value of a certain collection can also depend on the previous ownership and history, as well as the uniqueness of specific one-of-a-kind NFTs, so these hold more value as gambling assets.
Comparative Analysis with Traditional Gambling Methods
The field of NFT gambling is so different from traditional online casinos that it takes a comparative approach to explain those differences. So, we’ve tried our best to objectively consider all the good sides and drawbacks of NFT and DeFi gambling and betting, so here’s a brief overview:
- Offer faster and more secure transactions than traditional casinos
- No payment or payout fees
- There’s no need to verify your account by providing personal details
- You can claim bigger bonuses and gamble for higher-value tokens
- Chance to play provably fair games with verifiable fairness and higher RTP
- It can be difficult to find gambling platforms that accept NFTs and DeFi tokens
- Lack of regulation and terms
- High volatility of the market and token value
As you can see, traditional casinos are simply easier to reach, but they have lower security and fairness rates when compared with gambling sites that operate within the DeFi system.
Strategies For Mitigating Risks
As for the risk leverage when gambling on these platforms, it’s up to each player to determine the level of risk they are willing to take. Of course, there are some pointers that you may use for the benefit of your gaming style, but it all starts with responsible gambling.
You should be aware of the value of the token you are wagering and how it rates in the NFT and DeFi sphere before you make a bet. Plus, there’s also something in knowing the market and its specifics, so we suggest you get educated on how NFTs and DeFi systems work in the first place.
It’s also worth exploring how the value of the tokens can change, so there aren’t any unpleasant surprises when it comes to your balance.
The Future of Gambling with NFTs and DeFi Tokens
Ultimately, we can see why decentralized are the future of online gambling based on how NFTs and DeFi are slowly getting integrated into the field. However, the regulations and lack of NFT gambling sites are currently barriers for players who would love to expand their reach onto these sites.
Even so, we should expect to see more of these in the near future since their technological advancements are getting more and more beneficial for players. From the safety perspective to bigger bonuses and easier navigation, NFT and DeFi DApps are turning the odds in players’ favor.
What are NFTs and DeFi casinos?
NFTs and DeFi casinos are online gambling platforms where players can wager in decentralized tokens and play their favorite gambling games and provably fair releases just like on traditional casinos.
What are the main benefits of NFT and DeFi gambling?
The main benefits of NFT and DeFi gambling are in the security of player information, privacy, anonymity, and fast transactions. You can also find better bonus offers and a more diverse gaming selection that expands to blockchain-based games only available for holders of these and crypto coins.
What are the main disadvantages of NFT casinos?
The main disadvantage of NFT casinos is the lack of gambling sites where players can wager their tokens when compared with traditional casinos, and the lack of regulations and protocols for properly running these sites.