BITCOIN faces a unique opportunity in the wake of the Australian government’s decision to crack down on offshore gambling.
The IGA Amendment Bill 2016 is expected to be finalised in the coming months, clamping down on ‘offshore’ gambling sites which offer their services to Australians.
Some of the measures being debated include harsh penalties for businesses and individuals who market gambling products to Australians, plus politicians have vowed to investigate the possibility of payment blocking to unregulated sites.
This opens up doors for bitcoin to be more widely used as a deposit method at gambling sites as Australians continue to look offshore for better odds and the ability to wager larger amounts.
So why is bitcoin going to get a shot in the arm? Well it comes down to:
Interactive Gambling Amendment Act 2016
The bill to amend the Interactive Gambling Act 2001 was introduced last year after former New South Wales Premier, Barry O’Farrell, released a report called the “Review of Illegal Offshore Wagering”.
The report addressed the ambiguity surrounding the gambling laws in Australia and while online gambling is not legal, it is not illegal either.
The review garnered a lot of publicity and politicians scrambled to alleviate the loopholes.
This resulted in the Minister for Human Services, Alan Tudge proposing the Interactive Gambling Amendment Act 2016 which makes it illegal to gamble at offshore sites.
Problem gambling was cited as the reason behind the bill, despite online gaming sites offering as many, or more protective measures than land-based venues.
Online casinos and bookmakers allow punters to set deposit and wagering limits as well as time restrictions. Operators also can easily keep track of spending habits and are alerted instantly to any unusual behaviour.
Land-based gambling laws in Australia relies on busy staff to notice problem gambling behaviour.
The bill has passed through the House of Representatives and was then debated by the Senate where secondary amendments were added.
Instead of looking to regulated markets, such as the UK Gambling Commission for inspiration, Australian politicians, egged on by anti-gambling bodies, vowed to crack down on offshore sites.
In reality they are clamping down on legitimate businesses with legitimate licensing from countries like the United Kingdom, which has one body regulating online casinos, poker, sports betting sites and any other type of wagering.
It soon became clear this was about the government’s inability to tax offshore gambling sites, not about protecting the well-being of Australians.
One Senator called it how it is.
“Screw the government and get a VPN,” David Leyonhjlem said, after introducing an amendment bill which would have excluded poker and blackjack from the amendments.
Senator Leyonhjelm’s amendment was thrown out by politicians who have a guillotine hanging over their heads, brandished by staunch anti-gambling advocate and South Australian Senator Nick Xenophon.
This has forced many businesses out of the Australian market because they can not run the risk of falling foul of their own government regulation, if Australian authorities put pressure, for instance, on a UK or Malta regulated casino.
Gambling giants 888 and 32Red are just a few of the big name companies who have left the Australian market, while others with huge business bases in Australia like Pokerstars and Fortune Affiliates, who manage casinos like Royal Vegas and 7Sultans expected to follow suit.
This opens up the Australian market for the less government-scared bitcoin businesses.
Why bitcoin casinos and sportsbooks are licking their lips
Bitcoin gambling is already a blossoming industry with 100s of online sportsbooks and casinos operating online from various parts of the world, with huge business coming from Asian countries like China, where the people are traditionally tech savvy and face strict gambling laws.
In the 2014-15 financial year Australians spent almost $23 billion on gambling making them the biggest spenders per head on wagering in the world. This figure increased seven per cent on the previously monitored period and showed the extent of gambling in this country.
With Australian-licensed bookies facing more restrictions on advertising, offering lines of credit and the banning of “in-play” live betting, all services bitcoin bookies can offer, more and more people will turn to the digital currency.
The peer-to-peer nature of bitcoin means players are largely playing at these sites anonymously – they simply sign up – transfer the desired amount to the gambling site and begin playing. When they are finished they withdraw back to their e-wallet and carry on.
The Australian situation is potentially worth millions of dollars with many online poker enthusiasts, casino players and sports bettors vowing to continue to bet with whomever they like, spurred on by Senator Leyonhjelm’s verdict.
Australian government plans to remove bitcoin double taxation
The funny thing is, the government is going to make the use of bitcoin a lot cheaper for Australian players.
The 2017 budget revealed from July 1, bitcoin and similar digital currencies will no longer be subjected to ‘double taxation’.
At the time of writing, users of the digital currency bear GST twice and while the government did not intend to change this for gamblers, it will make it cheaper for us to deal in cryptocurrency.