Dan Goldman Sees Blockchain Solving Online Poker Security Concerns

Virtue Poker's CMO Dan Goldman uses the lessons learned from online poker's past to help move Virtue Poker forward.

“In 2004 poker was in such a boom you couldn’t walk into a 7/11 without seeing a display of chips and cards and stuff like that.”

When it comes to the rise of poker, and more specifically online poker, few have the same perspective of Dan Goldman, the one-time Chief Marketing Officer for the, then, fledgling online poker site PokerStars. Back in the pre-Moneymaker days Goldman and his team were tasked with finding a way to not just overtake the industry-leading Paradise Poker but also, make online poker more acceptable to the masses.

Goldman wasn’t just “around” for the Moneymaker effect, he was in the room, watching the final table when Chris Moneymaker bested Sammy Farha to become the 2003 World Series of Poker Champion, helping elevate online poker to heights no one could have predicted.

“I was regularly asked what the things are that drove this boom and I always said there were three things,” Goldman recalls. “One of them was online poker. One of them was Chris Moneymaker winning the World Series. And the third was poker on television actually becoming interesting.”

Goldman was at the helm of marketing for PokerStars from 2002-2007 and has 17 years of internet gaming experience. Now, over a decade after helping make the PokerStars brand the industry leader it is, he’s back in the saddle, taking on the new challenge of introducing a whole new generation of players to the world of crypto poker and blockchain poker as CMO for upstart online poker operator Virtue Poker.

It turns out, that despite the evolution of the online poker industry – some challenges remain the same.

Goldman recalls going to conferences or sitting around the poker table trying to convince people that online poker was the future of the game, but having to answer all the same questions.

“Number one: how do I know that I’m not playing against one guy, sitting with eight computers and he can see all cards but mine. Number two: how do I know that the site isn’t just rigging the deck so that I lose? And number three: how do I know that they’re not going to steal my money?”

“The truth is, it was pretty hard to combat any of those things. Goldman said. Here we are 16 years later and the funny thing is the same arguments still come up every day…the difference now is that there’s evidence that there is such a thing as a superuser account, practical evidence that sites steal player’s money. In 2002, people were just suspicious now they know that these things can happen but we’re finally at the stage where we have technology that is capable of preventing these things from happening.”

Goldman asserts that he’s in a similar situation from back in 2002, having to still answer those questions, but that Virtue is using technology – specifically the blockchain – to help change the game through security.

“The thing that keeps typical players away is that they are afraid. That they feel like the chance that they are being cheated is high, the chance that they have their money stolen is high and they have clear evidence to support that.”

The idea the Virtue Poker team is working on is decentralization of the poker experience through the use of smart contracts and the blockchain.

“The way our system works is we don’t have a trusted third party. If you are playing, you sit at a table or you enter a tournament, what happens is you have a wallet that has Ether or Bitcoin or Litecoin and you want to play in a tournament that costs $100 to play in. You sign up for that tournament but you don’t send $100 to Virtue Poker. What you do is you commit that $100 from your wallet in a smart contract that is mediated on the blockchain by everybody else.”

Win or lose, at the end of the tournament, the smart contract is enabled and the prize pool funds are distributed. According to Goldman, there’s a next-level of security for player funds that comes without having that trusted third party holding on to funds that, should they go under or decide to skip town, players would lose. A story that’s been told a number of times in the history of online poker.

“In no case have you transferred control of that money to any other trusted third party. All you’ve done is deposit that money in a smart contract that can be arbitrated by the millions of people that have participated in the Ethereum blockchain.”

The safety of player funds is just one of the ways Goldman says that Virtue Poker is attempting to address the questions that have weighed on the minds of the casual online poker player.

“What players care about in my experience is they want to know they’re not being cheated, they want to know that no one else can see their cards and they want to know that their money is safe,” Goldman says. “We are also attacking the issue of fairness, game safety and making sure that the site isn’t hacked. We’re using some unique technology that we’ve built so that when the deck is shuffled, instead of sitting on a central server somewhere, which can be hacked, we have every player in the hand participate in shuffling the deck.”

Goldman says that through the use of encryption, that players won’t be reliant on that third party to make sure the deal is above board.

So while Goldman is optimistic that Virtue will deliver on an online product that will help advance the technology of online poker, he’s still one of the guys who is going to have to try and bring it to not just the hardcore poker community, but those who have stayed away in recent years.

“One of the questions I’m asked all of the time is: ‘Is there going to be another poker boom?’ and up until a few months ago I was skeptical that there was ever going to be an opportunity to be a new poker boom because of the questions that have been raised by the twenty years of online poker that we’ve had so far are so serious and so alarming to players that I just didn’t believe,” Goldman said.

“Using the blockchain is that seismic thing that could change the future of online poker.”

Goldman acknowledges that it’s going to take more than blockchain poker to ignite the wick of a new poker boom, poker would likely have to come back to the U.S. In a meaningful way, but he’s now more optimistic than he has been in years.

His current situation also poses another similarity to the pre-poker boom era.

“When I started at PokerStars our primary deposit method was PayPal and people were very skeptical about PayPal.”

In order to get people to play on Virtue Poker, he’s going to have to get them comfortable with crypto.

“Clearly we are depending on the broader acceptance of cryptocurrency to help drive our business and that is absolutely going to be a struggle. We are going to have to teach people how to buy cryptocurrency. Our typical customer, one year from today, will be somebody that bought cryptocurrency for the first time specifically to play on our site.”

“I have no doubt that in a year, we will have introduced most of our customers to crypto. Four years from now, that won’t be the case.”

For Goldman, it’s challenge accepted. While online poker is now a well-established entity, the idea of blockchain poker is a new frontier. And while it’s unlikely that the universe will deliver another Moneymaker-like boom, Goldman has the tools he needs to help usher in what Virtue Poker hopes will be the next generation of online poker.