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Being a Blockhead

Regulators are going to have to come to terms with both cybercurrency and blockchain, and I’m glad I’m not the one who has to explain it to them.

Being a Blockhead

As I get older, there are many things that have become incomprehensible to me, but make perfect sense to others. While much of this is attributable to the way I was brought up, these things just don’t add up. They’re not logical, but it’s probably my fault I can’t grasp them.

Let’s start with social gaming. While I get the thrill of gambling—the excitement of the win, the anticipation of a possible win, and the rush of adrenaline that you get—I don’t understand how you can get the same feeling if you aren’t risking anything. I remember a few years ago, several years after the advent of iGaming in New Jersey, the folks at the Tropicana told me that they were making more money from social gaming than they were from online gaming.

Now my first thought, which was probably correct, was that they weren’t doing online gaming correctly. But I was truly shocked that these “play for fun” gaming sites were accumulating that much revenue. In fact, in our cover story this month on GAN, the founder and CEO Dermot Smurfit was one of the early proponents that all casinos needed a social gaming link, and of course he was right, judging from the success he’s made of GAN.

But how about esports? I come from a generation before video games. I remember being hunched around a Pac-Man game in a bar after my shift as a dealer in Atlantic City in the late ’70s, but that’s about as much as I got into video games. But of course my children and grandchildren are experts at the video games with the various titles of Fortnight, DOTA, Call of Duty, League of Legends, Grand Theft Auto and more.

About 10 years ago, I was invited to an esports tournament at the Cosmopolitan in Las Vegas and was amazed that thousands of people would cram into a ballroom to watch people play video games. And that there were actually announcers like the play-by-play types on broadcasts of actual sports, commenting on the action.

But since the majority of the attendees were under 21, I couldn’t see how a casino could truly utilize esports as an attraction in a profitable way. Wrong again. So while my amazement at the phenomenon of people actually enjoying watching other people play esports continues to this day, I can now see a path to profitability for casinos, even if it takes a few more years to totally evolve.

Now this one really gets me: NFTs. As it’s explained to me, an NFT, or non-fungible token, is valuable because it can be rare. So non-fungible means that it has unique properties that can’t be exchanged from something else. It’s mostly digital art that is perceived to have some value either because it’s gone viral or it’s a one-of-a-kind item.

When I was a kid, I was totally into baseball cards. I had boxes and boxes of them. I traded them, I matched them, I even put them between the spokes of my bike to make a motorcycle sound. I still have my Pete Rose rookie card, whose value had gone up and down more than a yo-yo over the years. I get that collecting NFTs is similar, but it’s not something you can hold in your hand. How can you duplicate digital art millions of times, but not affect the value of the original? If I owned the Mona Lisa, I’d understand that yes, it can be duplicated, but I own the original because it’s a physical item. How can you do the same with an NFT? Yes, I’ve got a long way to go on this one.

Something the gaming industry is going to have to confront soon is cybercurrency. This is similar to an NFT because you can’t hold a bitcoin in your hand. It exists in the ether, so how can it have value? I recently was informed that one bitcoin is worth somewhere in the neighborhood of $50,000. That’s a pretty hefty coin. But I guess with the headlong rush into cashless transactions, we’re going to have to find a place for cybercurrency whether I understand it or not.

In the same vein, I also have trouble grasping how blockchain works, particularly in the gaming setting. Yes, I understand that blockchain information exists on thousands of computers at the same time allowing us to record transactions in a logical manner, but I’ve also been told that blockchain is very hackable. So how could that work when casinos are already having trouble protecting their data from cyberattacks by teenagers? Oh, and Russians too!

Regulators are going to have to come to terms with both cybercurrency and blockchain, and I’m glad I’m not the one who has to explain it to them. Because the older I get, the more I long for the days of simple math and things that I can touch and feel, like cards on a blackjack table or chips at a poker game.

Roger Gros is publisher of Global Gaming Business, the industry's leading gaming trade publication, and all its related publications. Prior to joining Global Gaming Business, Gros was president of Inlet Communications, an independent consulting firm. He was vice president of Casino Journal Publishing Group from 1984-2000, and held virtually every editorial title during his tenure. Gros was editor of Casino Journal, the National Gaming Summary and the Atlantic City Insider, and was the founding editor of Casino Player magazine. He was a co-founder of the American Gaming Summit and the Southern Gaming Summit conferences and trade shows. He is the author of the best-selling book, How to Win at Casino Gambling (Carlton Books, 1995), now in its fourth edition. Gros was named "Businessman of the Year" for 1998 by the Greater Atlantic City Chamber of Commerce, and received the Lifetime Achievement Award from the American Gaming Association in 2012.

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