Blockchain has long been talked about as a crucial part of the industry’s future, but there remains uncertainty about what it does and how it can actually work in a gaming environment.
Quanta, the blockchain lottery specialist, aims to address some of those doubts at SBC Digital Summit Africa when it hosts the special ‘Everything you wanted to know about blockchain gaming but were afraid to ask’ session at 11:00 CEST on Wednesday 7 October.
The AMA-style session will see Harmen Brenninkmeijer (CEO, Quanta), John Kamara (SVP, DappTricity), and Ian Sherrington (CPO, Quanta) answering questions from the audience, who can submit their queries in advance here.
Ahead of the session, Brenninkmeijer told CasinoBeats about some of the advantages of blockchain and what needs to happen for it to go mainstream.
CasinoBeats: What advantages does blockchain offer to both local market and international gaming operators?
Harmen Brenninkmeijer: Player vs casino. This is a never-ending battle, with many people constantly trying to beat the casino, but often not having the trust. Therefore, security and innovation are paramount. With the blockchain, wagers, transferring funds, getting paid and having better escrow possibilities as well as having a blockchain-based RNG (fully on the chain), in combination with many other improvements related to the games and the backend systems, make it easier to be more transparent.
The conundrum, however, is that as many countries lack clear cryptocurrency regulations, then the industry is pushed into the grey zone, while it actually can be a far more transparent and profitable solution for the governments today.
So in my advice to governments, I stress that if they really want a healthy, honest and transparent igaming industry, they should accept blockchain technology. However, please don’t mix this with the cryptocurrencies as we are talking about two very different things.
Now, just to spend a minute on the land-based side of the business, remember that the technology allows for casinos around the world to better communicate with each other, by stopping foul play.
For example, we can verify the players, link them to their blockchain ewallets, enable better controls and exact compensation for the comps. We can trace the assets of the casinos, we can manage the systems and better secure all that’s to be reported properly.
CB: The public perception of blockchain appears to have been unduly influenced by media reporting of some high-profile cryptocurrency scandals. How can players be convinced to trust a blockchain casino or lottery?
HB: First, we have to separate the blockchain technology from the use of cryptocurrency. Leaving the crypto aside, we should talk about what the technology can do and how it can provide far better transparency to the players. It will also enable them to feel more secure and we even go as far as offering solutions whereby they can check the outcome of every slot spin with a product called Ginar.
We have the experience to tie the smart contracts to many more of the industry’s complexities. For example, can you imagine how much better a VIP player can fill up his ewallet and play with clear conditions listed into the smart contract? The level of trust can be increased dramatically and, in my view, it would make many more smaller players far more receptive to placing bets.
CB: How do regulators and governments view the idea of blockchain being used in the betting and gaming industry? Are there any benefits for them?
HB: This is where the difficulties are. The gaming regulators are dependent upon other areas within government and we all know that finance ministries or some committee has far more power and holds sway over what happens within the gaming industry, despite often not knowing much about the specifics of gaming at all.
So I can give you an example where we are negotiating with governments to launch a blockchain lottery and many regulators say ‘oh that’s a different licence and needs to be created and charged for’.
That clearly shows that people don’t understand that one can play a blockchain lottery under the same conditions and with the same fiat money as one would do with normal lottery. But maybe the truth is in the middle; often if they can make something more out of it they will.
At this stage we’re educating gaming regulators of what it is, while spreading the message further up the totem pole.
CB: What do you think the breakthrough product (gaming or otherwise) will be that drives blockchain into the mainstream?
HB: I believe a number of potential breakthroughs could help. First of all COVID-19 showed the power and strength of igaming and the growth in its numbers. But truth to be told, there is more growth in the grey area of this segment than in the regulated area. This means that governments need to wake up and regulate more.
We can help and create better transparency to make that happen. We can account for every penny being bet when using the blockchain technology, no matter if this is for a lottery ticket, sports bet or casino spin. So governments need to show willingness to regulate the industry and demand this level of transparency.
Secondly, we have the ability with blockchain technology to show more possibilities for the players to be in control and enable them to verify every bet outcome. This means that if the players are more educated and receptive, they should demand this level of transparency.
Maybe a few more scandals will help to create this movement. With this, I mean can the players really trust the return to player percentage being what it should be? Many people don’t understand that the proper regulated operators run slots that pay back around 95 per cent of the money bet. In my view this is one of the key reasons why the percentage of real money players is still still less than 10 per cent in most countries.
Thirdly, I believe that as the technology is improving, we can come up with more, faster and better games. That’s needed, as at this stage the tech is developed by too few people. That’s changing but takes time.
As you can see, what we as blockchain technology developers can create will have the ability to get more people to play together and have a trustless way to really bet against one another and not the house. Blockchain technology will make this far easier.
CB: And finally, could you tell our readers a little about Quanta’s blockchain lottery products and how they differ from traditional lotteries?
HB: We have several unique products and components. Let’s start with the number draw. We have a system called the Quanta Randao and are able to have, for example, disabled people in Sierra Leone make money by punching numbers and earning money automatically that’s being deposited in their ewallet and which they can exchange. The numbers are being used to determine the outcome of the lottery, which is fully end-to-end on the blockchain, unlike all our competitors.
This means that we have no weak points and that the contracts are fully transparent determining who the winners are. The players can therefore determine how people played, which prices were hit and what has been paid out. This level of transparency is not found in a traditional lottery. Do you know how many people bought a ticket and which prices are being paid? Yes, they might tell you, but it’s not available at your fingertips as it is with us.
The SBC Digital Summit Africa virtual conference and exhibition takes place on October 6-7, 2020, and features more than 60 expert speakers sharing insights about the opportunities for the betting and gaming industry in markets across the continent. It is free to attend and passes are available here.
