The Cryptosphere is highly speculative. We speculate it will develop into a self-sustaining economy. We speculate it will be superior to our broken debt-based system. Most of all, we speculate that we can turn a profit from it. This speculation is the equivalent of unregulated gambling.

Everyone is looking for the next Bitcoin. We want to throw down $1000 and be handed a million back. This optimistic greed is decidedly bad for the space. It creates massive volatility in price action and only serves to undermine the credibility of the blockchain. However, this matters very little. Greed is here and there is nothing anyone can do to make it go away. This is perfectly fine. Greed is the only reason crypto was created in the first place. We would have no need for it if fiat currency wasn't so close to complete catastrophic collapse.

When you invest in crypto today you're taking the gamble that it will be worth more tomorrow. This gambling is highly unregulated. The highest trading fees I've seen are 0.25%. Imagine if Vegas only took a quarter percent tax. They'd be bankrupt already.

In truth, decentralized crypto can't be regulated because there is no central point to regulate. This is why Bitcoin and Ethereum have been declared "not securities". The community of a cryptocurrency takes out the middle man and regulates itself. This is a great thing.

The House Always Wins

Everyone knows that casino games are rigged so that, on average, the house always wins. This is what causes the need for regulation: a centralized entity taking advantage of the masses. When the games are fair there is no regulation required. This is why hosting poker games at someone's house is totally legal. As long as no one is raking money out of the pot, and it's a fair game for everyone, it isn't technically considered gambling.

Crypto as an extension of a home game.

Cryptocurrency acts as an online version of this home game theory. We can create systems of gambling where no rake is taken. The middle man gets replaced with zero friction smart contracts. Vegas should be deathly afraid of crypto. They are about to become obsolete. Already we see the beginnings of this happening.

Augur

Augur touts itself as an

open-source, decentralized, peer-to-peer oracle and prediction market platform built on the Ethereum blockchain.

Make no mistake, this is unregulated gambling. Soon™ we are going to be able to place a bet on the outcome of any event without getting taxed for it.

This is an incredible revelation for various reasons. First and foremost, everyone has high chance of breaking even. This will be a godsend to citizens who are addicted to gambling, because they will no longer lose money on average. No longer will they be punished heavily for riding the highs of gambling. Gambling is a form of entertainment, and this day in age it should be free. We've had the technology for low friction gambling for quite some time, but greed has always gotten in the way until now.

Leveraged margin trading (MakerDAO)

Is the volatility of crypto not high enough for you? Using the MakerDAO platform one can lock up their Ether in a smart contract, pull out Dai stable-coin, and use Dai to buy more crypto. This is effectively doubling down (less than double) on your crypto investment. If crypto crashes you'll lose more money but if it spikes you'll also make more. This is one of the few crypto technologies that is actually delivering and you can use this service today if you're so inclined.

Even games like Steem Monsters could be looked at as a form of gambling. You pay money and hope that you'll get that legendary card in your pack. We can expect that many many more gambling-type services will be brought to as many platforms as possible. People love to gamble.

But, gambling is bad.

Perhaps you're of the opinion that gambling is amoral. This is often a religious argument, but also gambling causes a lot of real problems in society. These problems are most likely the reason for the religious rejection. A lot of people out there blindly oppose gambling without really understanding why. They simply believe what the church tells them. Fair enough.

I would make the argument that unregulated frictionless gambling eliminates all the problems associated with traditional gambling. Without a centralized authority exploiting the masses there is no more issue. Beyond this fact, gamblers must learn to set limits within their means. If you have a 50% chance of winning and you keep betting everything you'll eventually lose everything no matter what. It's better to positively develop your personality and use restraint and discipline rather than simply running and hiding from your shortcomings.

It's coming whether we want it or not.

Regardless, our opinions on the matter are irrelevant. Crypto and gambling are going to merge quite harmoniously. Expect more and more avenues to be opened on this front. There will continue to be devastating stories of loss and epic tales of wealth for many years to come.

Return from Unregulated Gambling: Crypto's First and Most Prominent Use Case to edicted's Web3 Blog