Bitcoin Gambling: Is it Legal?

In recent years, Bitcoin gambling has surged in popularity as a payment option for many people worldwide. With numerous ways to participate, the question arises: is this latest addition to the gambling landscape legal?

This is a rather intricate issue. Various regulators exist across the globe, and numerous countries enforce distinct gambling laws. Consequently, there isn’t a single comprehensive law governing Bitcoin gambling universally.

It all hinges on your geographical location.
Therefore, depending on where you reside, perceptions regarding the legality of Bitcoin gambling will vary. Before delving into the specifics of whether playing with Bitcoin is permissible, let’s cover the fundamental aspects of the different offerings available at Bitcoin casinos.

Bitcoin Gambling: What’s on Offer?

While most of our readers are likely familiar with the various ways to engage in Bitcoin gambling, it’s still important to ensure everyone is informed before we explore more intricate details. So, how can you participate in a Bitcoin Casino?

Accepting Payments

The ability to make payments to an online casino is crucial for online gaming. Without this capability, accounts cannot be funded, and players cannot engage. Nowadays, most online casinos accept digital payments, making it easier for Bitcoin and other cryptocurrency methods to be utilized.
Making BTC deposits is both efficient and straightforward.
Depending on the online casino, cryptocurrency can be utilized directly through the crypto address, via an e-wallet, or through an integrated exchange service within the online casino. This means that players using cryptocurrencies have multiple avenues to enjoy Bitcoin gambling.

Game Choice

Currently, games that accept cryptocurrency payments do not encompass the entire industry. Consequently, players seeking to engage in Bitcoin gambling face a somewhat limited selection of games. However, this situation is evolving as cryptocurrencies gain popularity as a payment method.
One area where Bitcoin has made significant inroads is in provably fair games. These titles leverage the Blockchain to demonstrate that the game operates fairly. Almost exclusively available at crypto casinos, this technology is more easily implemented with cryptocurrencies, whereas fiat-based games often opt not to use it.

Provably fair games have revolutionized online gambling.
Of course, Bitcoin gambling is still relatively new for players, which is why it lags behind fiat gaming in terms of game selection. Nevertheless, it is impressive to see the rapid expansion of game options in this space.

Safety and Security

This is where Bitcoin gambling truly shines. The security provided when using Bitcoin is among the best available. Although this might not be the common perception, it largely stems from a lack of understanding. The peer-to-peer nature of the Blockchain offers a level of security that exceeds that of traditional banking systems.
Additionally, the option to utilize cold storage wallets makes it virtually impossible for hackers to steal cryptocurrencies through digital means. The robust security of crypto is undoubtedly one of its most significant advantages over conventional gambling methods.

Ledger Nano S is a personal favorite of mine.
Bitcoin also allows players to retain their anonymity, meaning it’s impossible to link it to bank accounts or other identifiable information that could be exploited for fraud. Of course, this relies on players taking the necessary precautions to protect their information.

Bitcoin Gambling: Legality

Since its inception in 2009, Bitcoin has emerged as the first digital currency. Although it hasn’t achieved the widespread acceptance we might have anticipated, its popularity has surged significantly over the last five years.
Nevertheless, many grey areas surround Bitcoin, and people are often uncertain about its acceptance and legality in their region.

The crucial point is that Bitcoin is a decentralized currency, which means it cannot be regulated by any monetary authority or bank. Since there is no way to control cryptocurrencies, each government must determine whether to allow, regulate, or completely ban Bitcoin.

So, how are cryptocurrencies regulated globally, and is it legal where you reside? We have done the research for you, so keep reading; some regulations might surprise you.

Regulations in North America

USA

The United States appears relatively relaxed regarding cryptocurrencies and accepts them as a form of payment. Mining is also legal, and cryptocurrencies are subject to taxation by the US Federal Government. The saying, “If you can’t beat them, join them,” comes to mind, but to what extent is Bitcoin legal in the US?
In 2013, the Financial Crimes Enforcement Network released guidance stating that it is legal to pay for services or purchase goods using cryptocurrencies.

However, given the vast size of the US, we must consider: “How is Bitcoin and cryptocurrency regulated at the state level?” True to its nature, regulations vary from state to state, with some being more lenient regarding trading in Bitcoin and other cryptocurrencies. Therefore, it is advisable to verify whether it is permitted in your residing state.

Canada

Canada has similar legislation to the US, allowing for trading in Bitcoin and other cryptocurrencies. Although it is not considered an official currency in Canada, individuals can pay for goods and services using it, and they are also permitted to buy and sell cryptocurrencies, which are subject to taxation.
What’s particularly interesting is the presence of crypto ATMs in both Canada and the US, enabling users to exchange cash for Bitcoins and vice versa. You simply deposit cash into the ATM, and the equivalent amount in Bitcoins is sent directly to your crypto wallet.

Canada clearly states that cryptocurrencies are not legal tender and that the official currency is the Canadian dollar. This implies that no bank or financial institution oversees Bitcoin or any other cryptocurrencies. However, Canada appears to have a fairly tolerant stance toward digital currencies.

Regulations in South America

Chile

In 2019, Chile announced plans to tax crypto assets, marking a significant step toward legalizing cryptocurrencies. Prior to this, the legal status of Bitcoin was ambiguous. The South American nation never outright banned cryptocurrencies, but it also did not officially recognize them as legal tender.
In recent years, crypto exchanges in Chile have faced numerous legal challenges after banks closed their accounts without providing clear justification. A notable court case between Bancoestado (a state-owned bank) and Orionx (a crypto exchange) resulted in a Supreme Court ruling favoring the bank, asserting its legal right to close the exchange’s account.

While things may have changed since then, I wouldn’t take any chances. The legal landscape here remains murky, in my opinion.

Bolivia

Bolivia has taken a strong stance against Bitcoin and other cryptocurrencies, going as far as to implement a complete ban. The head of the ASFI (Financial System Supervision Authority) even likened it to a pyramid scheme in a statement following a fraudulent crypto arrest in 2017.
Long before this unusual comparison was made, the Central Bank of Bolivia had already declared:

“It is illegal to use any form of currency that is not issued or controlled by a government or an authorized entity.”

The rationale behind this prohibition is to protect the national currency and safeguard citizens from the risks associated with unregulated currencies. So, is Bitcoin legal in Bolivia? The answer is a definitive NO!

Argentina

I appreciate Argentina’s proactive approach to adopting cryptocurrencies. In an effort to safeguard its savings from inflation and to restrict foreign currency purchases and transfers, Argentina was among the early adopters of cryptocurrencies globally.
In Argentina, cryptocurrencies are entirely legal. Although this Latin American country has enacted regulations regarding the financing of terrorism, money laundering prevention, and taxation, it has not introduced specific laws governing the use of cryptocurrencies. Instead, Argentina has opted to observe the evolution of digital currencies and their effects on the Argentine market, which I find to be quite progressive!

Regulations in Europe

The European Union stands in stark contrast to South America, having developed a framework known as MiCA (Markets in Crypto-assets). Once adopted, MiCA will serve as a directly applicable law across all EU member states, regulating all service providers dealing with crypto assets.
The primary objective of this legislation is to establish clear rules and ensure long-term legal certainty. The EU believes that implementing MiCA will attract global crypto talent and investments; however, there are concerns that these stringent regulations may impose limitations on businesses and stifle innovative Bitcoin applications within the EU.

It’s understandable that the EU felt compelled to take action, and I see the reasoning behind their approach. However, this remains a contentious topic, as it could hinder innovation in the crypto sector.

Thus, while Bitcoin is legal in the EU, it is set to be strictly regulated.

North Macedonia

North Macedonia is an outlier within the EU, as it prohibits the use of all cryptocurrencies, including Bitcoin, Ethereum, Litecoin, and others. The National Bank of North Macedonia asserts that cryptocurrencies are associated with illegal activities and pose significant risks since decentralized currencies lack regulatory oversight.

Regulations in Asia

Japan

True to its reputation for innovation, Japan recognizes cryptocurrencies as legal property and regulates them through the Financial Services Agency (FSA). This allows users to freely buy, sell, and own any digital currency.
Japan also boasts Bitcoin ATMs, and given its status as a financial hub, it’s clear why the country is highly supportive of blockchain technology. In fact, Japan has one of the highest per capita adoption rates of blockchain technology, with numerous distributed ledger technology (DLT) firms, like Coinfirm, operating within the country.

Cryptocurrencies are governed by the Japanese Virtual Currency Exchange Association, the Payment Services Act, and the FSA. If there’s any country that wholeheartedly embraces crypto, it’s certainly Japan.

China

From a governmental standpoint, the primary concern surrounding cryptocurrencies revolves around issues like tax evasion, money laundering, and terrorism financing. While countries like South Korea and Pakistan have started to regulate Bitcoin and other cryptocurrencies, China has outright banned them.
Interestingly, over 65% of crypto miners are located in China, primarily due to the low electricity costs compared to other nations. Moreover, many miners are situated in regions like Sichuan and Xinjiang, where renewable energy sources such as hydroelectric, solar, and geothermal power are prevalent. This situation enables Chinese Bitcoin miners to operate at peak efficiency, giving them an edge over their international competitors.

Returning to the core question: Is Bitcoin legal in China?

The answer is no. Since 2019, it has been illegal to mitigate money laundering, and authorities recently issued a warning via social media stating that consumers would receive no protection if they incurred losses from crypto investments.

However, there is a glimmer of hope. It appears that China is planning to introduce its own national cryptocurrency, which could lead to significant changes in the country’s crypto regulations.

Regulations in Australia, New Zealand, and Samoa

Australia

Australia has adopted a straightforward approach to cryptocurrencies. They are entirely legal, but individuals must register with the Australian Transaction Reports and Analysis Centre (AUSTRAC). All transactions must comply with regulations designed to prevent money laundering, terrorism financing, and other financial crimes, and they are subject to taxation.

New Zealand

In many respects, New Zealand consistently seems to be ahead of the curve, and this applies to its approach to cryptocurrencies as well. Not only is it legal to buy, sell, or own Bitcoin, but cryptocurrencies can also be utilized to receive salary payments.
Naturally, this is taxable and must be linked to a fiat currency, but it represents a significant milestone.

Samoa and Vanuatu

Aside from Australia and New Zealand, Samoa and Vanuatu appear more cautious regarding cryptocurrencies. The Central Bank of Vanuatu does not promote investment in Bitcoin, and it is not recognized as legal tender.
However, it is not illegal; should a business owner wish to promote cryptocurrencies, they must obtain a license to do so. If such a business fails to comply with the Money Laundering Prevention Act, it risks imprisonment or substantial fines.

Regulations in Africa

South Africa, Namibia, Zimbabwe, and Nigeria

Bitcoin and cryptocurrencies are not explicitly legal in South Africa, Zimbabwe, Namibia, and Nigeria, but they are also not outright illegal, as these countries have not completely banned or regulated cryptocurrencies.
In 2014, the South African Reserve Bank indicated that virtual currencies are neither overseen nor regulated, and this stance has not changed. There is no specific law regarding the exchange or ownership of Bitcoin, and since Bitcoin is not recognized as legal tender, it is not accepted as a payment method.

Surprisingly, this hasn’t deterred South Africans from owning Bitcoin and other cryptocurrencies. In fact, a study revealed that 10.7% of internet users in South Africa possess some form of cryptocurrency.

Algeria, Egypt, and Morocco

In Egypt, cryptocurrency trading is strictly prohibited under Islamic law. Although a religious decree is not legally binding, amendments to Egypt’s banking laws in 2020 banned the issuing, promoting, or dealing in cryptocurrencies without a license from the Central Bank of Egypt.
Algeria has also prohibited cryptocurrencies since 2018, as has Morocco, although Bitcoin purchases have surged in the latter country.

Final Word

Bitcoin and cryptocurrencies have opened numerous avenues globally. While I understand that governments and central banks need to manage this new trading method and that issues like money laundering and terrorism financing should be closely monitored, I find this revolutionary shift incredibly exciting.
Some nations embrace cryptocurrencies wholeheartedly, while others impose outright bans, but one thing is certain: crypto is here to stay, regardless of whether governments approve.