Gambling Commission CEO Andrew Rhodes has said pressure is building in the UK around allowing cryptocurrency to be used as a form of payment with regulated operators.
Delivering a keynote speech at the IAGR Conference in Toronto yesterday, 22 October, Rhodes touched on several key topics impacting the UK market, including the black market and account restrictions.
On the cryptocurrency front, Rhodes said the timeline for wider adoption among the general public and gambling consumers had accelerated in recent years.
In turn, this acceleration has meant consumers are expecting to be able to use cryptocurrency as a payment method with operators.
As per the Financial Conduct Authority, around 12% of UK adults now own or have owned crypto, up from just 4% in 2021.
Draft legislation published by the UK government in April has also outlined a regulatory framework for cryptoassets.
As it stands, regulated operators in the UK are unable to offer cryptocurrency as a payment method.
However, black market firms and crypto casinos are offering customers the opportunity to use cryptocurrency.
Rhodes said the shift in approach and adoption of crypto in the UK meant there was a pressure swell impacting gambling.
He added that the change had come far quicker than anticipated, meaning questions around regulation were now far more pertinent.
Rhodes said: “Right now we don’t have any licenced operators offering crypto. It’s difficult to see how we would licence those who are offering crypto casino, but we do know in the illegal market it is widespread.
“We also know that the demographics under 40 are starting to use cryptocurrencies a lot more. In fact, for many, crypto assets are more dominant than fiat currency or fiat-based assets.
“Which means over time there will be a generational cohort who currently, if they are using cryptocurrencies, do not have a space in the legitimate market.
“And what I personally felt maybe a year or two ago was perhaps a problem that was five years away, I think that is now maybe 12 months, 24 months away as we are seeing this grow.”
Rhodes went on to note that regulations around crypto gambling were outside the remit of the Gambling Commission and instead would be have to be broached by government.
Concerns around source of funds and the volatility of crypto were flagged by the Gambling Commission as part of the white paper into the Gambling Act 2005 review.
When the government published the white paper in April 2023, it wrote: “Government is clear that cryptoassets must not become a vehicle for lower standards in the licensed gambling sector, either in terms of harm prevention or regulatory compliance.
“The Commission’s current approach adequately deals with that risk at present, but it will continue to monitor the development of new technologies and payment vehicles closely.”
Rhodes concluded: “It also brings some interesting and difficult questions for us around how would you even try and work with cryptocurrencies given all the problems we know we have around traceability of funds, AML risks, terrorist financing, do you start to look at cryptocurrencies as demonstrating a source of wealth, or can they be a source of funds?
“Now these are going to be governmental level questions. They’re not, I think in reality, going to be questions for individual gambling regulators, but that pressure is definitely not going to go away and we can certainly see that building within Great Britain.”
The post Gambling Commission CEO: Crypto gambling pressure “building in Great Britain” first appeared on EGR Intel.
Andrew Rhodes says the next generational cohort may not have a space to gamble in the legal market due to their preference for cryptocurrencies over fiat assets
The post Gambling Commission CEO: Crypto gambling pressure “building in Great Britain” first appeared on EGR Intel.