Common Bitcoin & Betting FAQ’s
Bitcoin can be intimidating but we’re here to help. Our team of experts put together a list of the most common questions and biggest misconceptions related to the ‘internet of money,’ and created this helpful FAQ guide that you can rely on if anything comes up when you’re trying to use Bitcoin for deposits and withdrawals at your sportsbook.
Wait, why is my betting site accepting Bitcoin?
The are many compelling reasons that sports betting sites allow bettors to use Bitcoin; fees are significantly lower than for credit card payments and bank transfers, new clientele can be reached in underdeveloped (or underbanked) regions, and an emerging, tech-savvy clientele can be attracted.
These same advantages apply to online merchants everywhere; hundreds of thousands of online retailers accept Bitcoin, and hundreds more are signing up by the day as Bitcoin grows in popularity. It might seem hard to fathom, but we believe that Bitcoin is only in its infancy and that it will continue to grow as merchants and users alike come to realize Bitcoin’s massive benefits.
What are transactions fees?
Transaction fees are fees paid to Bitcoin “miners,” who provide the computing power that solves the complex mathematical problems necessary to have a transaction confirmed on the blockchain. Without these miners, cryptocurrency and the ‘asymmetric cryptography’ that underlies the blockchain, Bitcoin would be impossible to realize. Miners secure the integrity of the blockchain, and as a collective, they are responsible for ensuring Bitcoin is a well-oiled machine that responds to and reacts to its users within its network.
The miner’s fee is technically voluntary. But there is nothing forcing a miner to accept a transaction and include it on the blockchain, so without an incentive, it is possible that your transaction will drift into the recesses of the network, taking weeks to confirm. For this reason, we recommend sending a nominal transaction fee to make sure that your transaction is successfully verified, or ‘mined,’ and added to the blockchain. It is common practice for the sender to pay the miner’s fee.
Traffic, volume, and noise within the blockchain affect how quickly your transaction will be added to the blockchain by the miners. But you can always counteract delays by including a higher transaction fee: the bigger the fee you include, the greater the incentive for miners to add it to the blockchain.
When your transaction has been accepted, you will receive a confirmation; this means that the network has reached a consensus that your bitcoin has arrived at the right address or is now your property.
Who pays for my transaction fees?
In almost all scenarios, the sender will include the mining fee. However, certain sportsbooks will absorb this cost for you, meaning that sending Bitcoin to that sportsbook is free of charge. Sportsbooks do this to entice you to fund your account with Bitcoin because even the largest mining fees are smaller in comparison to the fees associated with banks, credit card companies, and third-party payment platforms like PayPal or Neteller. If your sportsbook does not absorb the miner’s fee, rest assured that Bitcoin transaction fees are significantly lower than with any other currency or payment platform.
How much are transaction fees?
If you are asked to send a fee with your transaction, you should do this or risk having your transacting go awry on the blockchain, as mentioned above.
Almost all Bitcoin wallets will automatically add what they think is an appropriate mining fee to your transaction. If this is the case, your wallet will let you review the fee before you officially send off your Bitcoin, and it is possible to adjust how large or small of a fee you include if you have a preference for how quickly or slowly you want your transaction to occur.
It is important to note that miner’s fees are not proportional to how much Bitcoin you are sending; in fact, the smaller the transaction, the higher the fee may be.
Generally, the recommended miner’s fee is equal to 0.0001 Bitcoin (around 60 cents USD at press time).
Sites like BitCoinFees.21.co offer users live updates on the fees paid to miners. This provides a baseline and average for transactional fees that is constantly updated in real time.
Is Bitcoin legal?
Yes, Bitcoin is legal. However, certain nationalities restrict Bitcoin exchanges, like China (and soon Russia), while others restrict the use of foreign currency within their borders, such as Argentina.
Bitcoin is a new technology, and different countries and jurisdictions are integrating Bitcoin into their legal systems and financial regulations at different speeds.
Can my Bitcoin be hacked?
No, your Bitcoin cannot be hacked. Hackers cannot gain access to, manipulate, or reverse any transaction on the Blockchain; it is simply impossible thanks to the built-in security of Bitcoin.
It is possible for your wallet to be hacked if you do not take the proper security measures. However, if you use a trusted wallet or exchange in addition to always using two-factor authentication, your Bitcoin will be safe from anyone trying to lay their hands on your virtual cash!
What is mBTC?
You might see mBTC listed on your sportsbook. This is simply a metric to make looking at Bitcoin easier on the eyes; because Bitcoin’s supply is finite (fixed at 21 billion Bitcoins), and Bitcoin is infinitely divisible, there are some metrics for representing quantities of Bitcoin less than one. A single mBTC is the equivalent of a millibitcoin or one one-thousandth of a Bitcoin.
mBTC = millibitcoin = one one-thousandth of a bitcoin = 0.001BTC
What is uBTC?
This is similar to the unit mBTC, except uBTC represents one microbitcoin, or one one-millionth of a Bitcoin.
uBTC = microbitcoin = one one-millionth of a bitcoin = 0.000001BTC
Am I actually making bets with Bitcoin?
No, you are not actually placing bets with Bitcoin. When you make a Bitcoin deposit at your sportsbook, they will instantly convert your Bitcoin into USD. Your bets will be placed with the USD you receive in exchange for your Bitcoin, based directly on Bitcoin’s value at the time of conversion. Of course, you are always eligible to convert your winnings in USD back to Bitcoin when you make a withdrawal!
What happens if Bitcoin’s price goes up, or drops after I transfer funds to a gambling site?
The good news about using Bitcoin on your sports betting website is that you are protected from any kind of swing in the price; you will not be exposed to Bitcoin’s volatility. Due to the fact that sportsbooks instantly convert your Bitcoin to USD at the time of your deposit, you are not privy to changes in the market value of Bitcoin. Technically, the bets you place after depositing with Bitcoin are in USD. The amount you will have to bet is always going to be equal to Bitcoin’s conversion rate to USD at the time of your deposit; regardless if Bitcoin goes up, or goes down, your funds will not be impacted in any way whatsoever. Sportsbooks absorb the risk of a wild drop, but also retain the benefits of a massive upsurge in price.