Report: PokerStars Gearing Up to Accept Bitcoin

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According to Online Poker Reportand other sources, PokerStars, the largest online poker room in the world, is preparing to accept Bitcoin. The site’s timeline for doing so is not known, but Chris Grove from OPR told PocketFives that PokerStars has started to assemble the vendors that would be necessary to take Bitcoin.

“They’re not going to handle taking Bitcoin internally, so they’d need a vendor in the same way you’d need a vendor to process credit card transactions,” Grove told us. According to Gambling Compliance, “PokerStars and major Asian-facing operators are among those pushing for Bitcoin’s acceptance as three prominent gambling hubs hold advanced talks to allow it as a payment method.”

Grove relayed why a site like PokerStars would gravitate towards accepting Bitcoin, telling us, “The big advantage of Bitcoin, some would argue, is that when you look at markets that don’t have a strong payment processing framework, it allows you to enter those markets. That’s the long-term play: it broadens the map of markets they can participate in.” Countries like India and China are examples of markets that would be easier to access with Bitcoin as opposed to more conventional financial mechanisms like wire transfers, credit cards, and checks.

Poker rooms like Seals with Clubs and Breakout Gaming have tried to capitalize on the popularity of Bitcoin, while websites like Newegg, TigerDirect, and Overstock accept Bitcoin for purchases in the non-poker world. There are even Bitcoin ATMs. The currency has been a bit unstable, however, and has been rocked by scandals like the collapse of Mt. Gox in February in which the exchange’s half-billion dollars in Bitcoins disappeared.

Recent interest in allowing Bitcoin payment processing from the Isle of Man and Alderney, along with a late-arriving Malta interest, may accelerate adoption, provided each jurisdiction’s money laundering concerns can be addressed.

“Risk-layoff services have emerged where an i-gaming operator, or any merchant accepting Bitcoin, can effectively lay off volatility risk on third parties like GoCoin. Even Paypal allows merchants to accept and lay off risk with such services,” according to David Gzesh, an industry consultant working toward acceptance by i-gaming regulators since 2013.

He added, “It was clear at last month’s Bitcoins4iGaming Conference in London that once jurisdictions become comfortable with AML and KYC rules for their merchants, Bitcoin acceptance will quickly be added to the mix of options on a country-by-country basis. However, this ROW adoption will not be a magic bullet for US players longing to return to Stars.”

Accepting Bitcoin would be the latest in a string of changes at PokerStars following the site’s acquisition by Amaya Gamingin June. In the last six months, PokerStars has altered its currency exchange policy, hiked rake, changed its promotional lineup, and adjusted its Pro roster, just to name a few highlights. It is believed that some, if not all, of these changes were in the works well before Amaya purchased the site, although it’s possible that the transaction, which was for $4.9 billion, sped up their implementation.

Special thanks to Chris Grove for his insight!

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7 COMMENTS

    • Wow, didn’t think they would want to do this because of anti-money laundering regulations. Guess I am wrong in my thinking.

      Wouldnt this essentially make it legal for US players to play as well?

    • The big gripe was the money moving and not the poker so if stars will take BC they should let anybody from anywhere play with bitcoins.

    • Wouldnt this essentially make it legal for US players to play as well?

      I’ve talked to two people about this – Chris Grove and gaming attorney David Gzesh – and both said no. David said, “Accepting bitcoin should not affect the underlying legality of operating any gaming site in any US markets.”

    • Bitcoin was classified as a currency by a federal judge in a fraud case last year http://techcrunch.com/2013/08/07/bitcoin-clampdown-continues-as-federal-judge-says-its-a-currency/

      While Seals and other bitcoin accepting sites are flying under the radar, with the authorities knowing it will be a pain to to after them, its highly unlikely Stars will be able to use this (or have any desire to do so) as a loophole to re-enter the US.

      Re. money laundering fears. While there is an underground element to Bitcoin it is moving more towards the mainstream and many legitimate transactions are happening all the time using Bitcoin. However this is probably why Stars are looking for a vendor, as it is very simple to send and receive bitcoin. I imagine a third party, with a track record in bitcoin transactions and all the due diligences in place would protect Stars both from questionable transactions and from any legal fallout if any got through.