How Changes in Laws Affect the Ethereum Gambling Industry

 January 20, 2023

By  Kyrie Mattos

Many countries in the past decade have seen changing regulations surrounding the crypto gambling industry, specifically Ethereum gambling, along with variable effects on the sector’s growth.

Overview of Ethereum Gambling

Ethereum gambling is a process of gambling with Ethereum tokens to play casino games or bet on sports events. Ethereum (ETH) is a virtual currency or cryptocurrency used for different purposes, especially online gambling. Gambling with Ethereum is similar to gambling with fiat currencies like the US dollar or European euro. Players prefer playing games with Ethereum since ETH offers many advantages over other cryptocurrencies or traditional currencies. ETH transactions are way cheaper and faster than transactions made with traditional currencies. 

In addition to this, the popularity of ETH tokens has led to the development of several other ETH-specific crypto-gambling websites that offer a wide variety of casino games and sports betting options, thereby making Ethereum gambling an excellent choice for gamblers who wish to experience fast and easy gambling with their favorite games. 

Government’s Approach Towards Regulation

Currently, Ethereum gambling has challenges, such as scalability, increasing costs of transactions, privacy, MEV, and, most importantly, centralization fears. Before, Ethereum existed as a proof-of-work crypto blockchain network, and the mining pools were significantly large, having more power of consensus. Such a model sparked the talks of centralization that ruined everything Ethereum was useful for – a scalable, secure, and decentralized network.

Coming to the government’s approach towards regulation,  a study comprehensively reviewed all the current policies regulating the Ethereum gambling industry in 49 countries. In only 41 of the 49 countries where Ethereum gambling was a legal activity, only 2 published their annual reports about the impacts, whereas, in 36, public reporting was completely inaccessible. This general lack of transparency and coherence about Ethereum gambling regulations implies that the governments are unaware of the degree of gambling issues and the adverse effects of gambling on users’ mental health and finances as the industry grows exponentially. 

Many researchers believe that the regulation is ill-equipped and outdated regarding the advancement of digital technology that is fuelling the growth of the Ethereum gambling industry. Currently, many countries lack proper regulation and protection against the harmful impacts of online gambling markets.

Impact of Regulations on Innovation 

Regulatory measures that change the accessibility to Ethereum gambling opportunities certainly have a great impact on gambling participation. Changes in the regulations directly impact Ethereum gambling related to certain games and indirectly through other mechanisms where a reduction in the overall Ethereum gambling reduces the prevalence of the gambling problem. Social accessibility is a relevant term that needs to be acknowledged in Ethereum gambling regulations, as it can substantially affect participation. With the increased use of several electronic devices for Ethereum gambling and international trends, participation in interactive games like Ethereum dice, poker, and many more have certainly increased, demanding more innovations in the Ethereum gambling sector and, therefore, more regulations on the innovations.

Comparing Regulatory Environment Across Borders

Every country has certain regulations and laws concerning the Ethereum gambling industry since gambling markets differ in several aspects. For instance, Ethereum gambling is legal in certain countries and illegal in many others. Many countries do not permit certain banking methods to be used for gambling, while others have different regulations surrounding Ethereum gambling. For instance, Ethereum-based casinos and apps in the US are considered under the financial institutions based on BSA or the Bank Secrecy Act, which assists the US government and aims to prevent money laundering. 

In Canada, the Ethereum gambling market was established in 2022 when the Alcohol and Gaming Commission presented gambling licenses that allowed gaming providers to provide their services to gambling platforms. While many Ethereum gambling brands are functional in Canada, only a few platforms are allowed outside Ontario. Different regions in Europe have complete autonomy in terms of Ethereum gambling. The European Commission states that no sector in the EU legislation oversees gambling services; hence, Ethereum gambling is allowed in most European countries.


To sum up, the growth of Ethereum gambling sites is certainly affected by the change in regulations in different countries. Weak regulation implies that people are unaware of the risks associated with gambling, and many take the activity as a way to earn money in hard times. For most unemployed youth, Ethereum gambling is no more a leisure activity but a potential source of wealth and income. Hence, strong policy-making is crucial to prevent harmful effects from gambling with Ethereum. Robust regulation may curb the rapid growth of online gambling and protect people from gambling addiction.

Kyrie Mattos


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