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- Ethereum Blockchain: What Is It and How Is It Used in Gambling?
Ethereum Blockchain: What Is It and How Is It Used in Gambling?
Online casinos currently follow the new decentralization trend and base their platforms on the blockchain technology. One of the most popular blockchain networks that are revolutionalizing the online casino industry is Ethereum. Slotegrator has prepared a basic introduction into the Ethereum blockchain and ERC20 tokens.
What is Ethereum Blockchain?
Ethereum is one of the world leading blockchains that was founded in 2015 by Vitalik Buterin and several other co-founders. It was created with the aim to allow building any kind of decentralized applications with the help of smart contracts. Therefore, apart from offering the native cryptocurrency Ether (ETH) for instant and secure transactions, Ethereum also allows creating DApps for various industries.
What is an ERC20 token?
The ERC20 is the token standard that is used for all tokens developed on the Ethereum platform, so every token on the Ethereum platform is an ERC20 token. It is a specific set of functions for developers to make their new tokens compliant with the network. It means that ERC20-based tokens are supported by Ethereum wallets, exchanges, and smart contracts.
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In order to make a token ERC20 compliant, developers should ensure that their smart contracts include functions that allow:
- get the total token supply;
- get the account balance;
- transfer the token;
- approve spending the token.
Here is the basic ERC20 token list that includes several most popular tokens created on the top of Ethereum blockchain platform:
- Maker (MKR);
- Basic Attention Token (BAT);
- Augur (REP);
- OmiseGO (OMG);
- IOST (IOST).
Use in Gambling
Ethereum blockchain is used in the gambling industry as its smart contracts ensure the high level of security and safety. For those unfamiliar with smart contracts, these are similar to the standard paper contracts as there are several sides signing an agreement with certain conditions.
Smart contracts consist of lines of code that takes inputs and returns an output. The code can’t be changed, so users always know what to expect. Let’s analyze the example.
In the Ethereum-based casino, all platform’s rules, information about games and conditions for payouts are written in smart contracts that are publicly available. Then, smart contracts work on “if/then” code. So, if players win, they should get payouts, and these rules are mentioned in a smart contract that forwards the winnings to players’ wallets automatically. This way, players can always access the information about the rules and be sure that the casino works fairly.
Ethereum blockchain has the potential to revolutionize gambling markets with its smart contracts that may help to ensure high-level transparency, fairness, and security, which will make online casinos trustworthy.
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