Topic: Gambling and KYC (Read 284 times)

It depends on us because now there are many gambling sites that apply KYC or not (anonymous) so I think most people don't want KYC because for me it is difficult and many crypto methods use it like that so KYC for gamblers doesn't need to be needed because not important except making credit card withdrawals etc.

There are a lot of gambling sites here, but what I often use to gamble is an anomaly site that is trusted enough to make deposits and withdrawals in a simple way for me, that's enough to gamble.

People are more likely don't like to do KYC because thats the main reason why they are using online money, so they cannot be trace.
Also many people don't have valid ids to do so.

They have KYC for specific reasons. If they think that your account is doing something unusual, they will require you for KYC.
Maybe you're talking about the exchanges that requires KYC? When you say "many gambling sites(sportsbookies) do KYC" can you cite the names of it that you know?

KYC I guess is required to all businesses that involves finances but not all of them are under the monitoring of AMLC.
AFAIK, these are the banks, exchanges, and other related financial instrument and to be honest, I haven't heard a gambling site that are required to comply with AMLA, requiring users a KYC does not necessarily mean they are under AMLC monitoring.

For people who have no idea on the law.
ALMC stands for Anti Money Laundering Council while AMLA is the law which stands for Anti Money Laundering Act.

If they are not all required, they are not obliged to adopt on AMLA rules.

I think it's because gambling websites accepts only crypto and some of the trading websites have paypal payment method or even credit card on their exchanges. If you will think a lot of websites that are accepting those payment method have KYC too, so I think that's why, or maybe there's a law about that in their country. Lot of gambling website's are run by anonymous owner so there's no need to comply with the law. That's what I think. 

IMO, as long as the online gambling sites does not accept fiat, they can conduct their operation without requiring their gamblers to submit with the KYC.

The thing is, if these gamblers will transact in a gambling site, they already complied the KYC from the moment they obtain the btc, either in their local exchange or the international exchange like Binance, and all of them requires KYC, so it coudl be redundant method if gambling sites would still require the same and for sure that would not give them an advantage to the fiat gambling sites.

KYC is part of AML, which stand for Anti-Money Laundering.
It is an instruments used to fight money laundering and financial terrorism and are necessary to prevent criminal activities.

I believe that countries around the world are obliged to abide by these procedures to prevail in security. In terms of security, it is better for users to be protected and I am in favor of these mechanisms.

I noticed the eyes of regulators now are more focused on exchanges than on gambling sites. Because of that some exchanges implemented and require KYC for everyone or restrict some users to register on their platform. For me, there is no really difference from these two it all involves money. When you trade on exchanges it is like gambling or betting sometimes you take profit sometimes you lose. I expect more strict rules will be implemented on the Gambling platform in the future but I hope not I am not really comfortable with KYC.

I am not sure you might be referring to fiat gambling sites cause I have not seen any crypto gambling sites asking it's user for KYC . Crypto exchanges are also not asking for KYC if you are okay to do transaction upto 2 Bitcoin. I am not sure about the faucet you are referring to as I do not do faucet. I have not see any cryptocurrency based site asking for KYC and those do ask I am happy to avoid and move to a new service provider.

Hmm interesting about gambling and faucets. A lot of crypto gambling sites do not need licenses. To add to that, and even those that do apply for Costa Rica or Curacao licenses, which basically does not need you to do anything special,,, especially Costa Rica no requirement for KYC from what I understand.

I think also it is the complaining from users that took down places like FaucetHub? Same as casino complaints:)

It's prolly cos the exchanges are where the rubber meets the road.  Control that...  And you control the entire space.  Gambling sites don't convert cryptocurrencies to fiat currencies.

Because in gambling sites, there are rules and regulations that they must follow to avoid being reported and banned from the site. The money they've spend in gambling all because of their own decision and actions. The gambling site is not accountable for that if they lose all the money they have. KYC is not necessary and customers should be anonymous and all of the thing that they access is the wallet address for the gambling site to let them withdraw their money. It still depends on the gambling site if it wants to implement KYC to prevent those professional scammers to enter their site and harm other customers.

i think that KYC is more for governments to have inside in the percent of people that gamble, since gambling is not promoted behavior, and it is considered as a type of addiction, that should be treated if serious, and presume that because of that there is so much regulation in the field

actually many gambling sites mostly sportsbookies are now have their own kyc  .the kyc could be done to enhance your account or only required once you withdraw larger funds but luckily there are gambling sites that does not do it because they also know that this kills the idea of a crypto/anonymous gambling  . thats also impossible that a government or just any normal people will not know that theres alot of money flowing on cryptos because cryptos value are way too high  . how much more if its a gambling business when we know gambling owners are likely going to win

Weren't a few countries requiring gambling sites to have KYC to guard against minors from playing? Though if we ignore that fact, Exchanges are in the end, strictly involved with being a middle man of sorts. They don't actually take a hold of the money, but rather exchange between the two parties or the like, so if one party renegades (does something illegal), strict implementation of rules is done and to do so, KYC is required. If you look at gambling, however, it's just most of the time the gambling company and the player itself. If the player loses, the company gains money, if the company loses, the player gains money. It's a strict relationship where money only flows between the two, so I doubt KYC/AML is that needed. And in most cases, players wouldn't even have any negative claims about their money. Why? Cause the money they deposited in the end goes to the company, not back to them.

My thought regarding this is that the government doesn't see that there's a huge buck that circulates in the crypto gambling industry. Unlike in the exchanges, they probably heard that an exchange earns millions a day and that's why they're focusing on it.
But somehow, if they will also see that online casinos earn that much, they will enforce it. They are not tight with casinos for now but who knows if they'll strictly enforce KYC once BTC goes ATH.

I didn't see any post on the security and moral aspect of implement the typical kyc. Imagine if the governments implement the kyc on every business on the internet... That will probably lead to mass exodus from the internet if people aware of the real risks. Those who decide to stay will be exposed to big risk as long as evil exist.
Kyc should be safe for everyone. It's a very bad idea to put thousands/millions/billions in unsafe situations because of few people.

If majority are avoiding kyc or don't feel conformable with it, it's likely for a good reason.
Why not decentralized and safe kyc? What matters is that kyc system does the job  societies want it to do, right?

I totally agree with you on this...

Opening a casino puts you in the gambling business: poorly regulated in most jurisdictions except in some parts of Europe and in the US. This is changing rapidly though, with many jurisdictions either considering regulating online gambling or re-regulating it (for the latter, this example most affects countries like the Netherlands, which will then re-regulate online gambling and affect all those Curacao-licensed casinos).

Opening a faucet or wallet service or exchange puts you in various categories under financial institutions: strictly regulated in most jurisdictions globally. Those that have managed to so far evade KYC/AML obligations have done so because they fall under jurisdictions that only provide for loose obligations, but under new FATF and EU AMLD5 implementations, even these have to eventually comply or get into blacklists.

It's simply the practicality of which industry you fall under, and, therefore, which legislation you fall under and which body, if any, regulates you.

Most likely, the more anonymous the casino (no license, for example) will also come under heavy scrutiny. You want to play ball and have some form of legitimisation (say, with a license), then you gotta eventually comply with some sort of KYC/AML measure.

Withing having an prior knowledge I'll go with an instinct answer of, since it's more easier to launch an online gambling site without any permission and staying completely anonymous, not been registered under any government body, than it has to be also easier to operate them without having to comply with the KYC/AML rules and regulations. The gambling industry is less regulated compared to the exchange industry, and since cryptocurrency exchange are more related to cryptocurrency than gambling sites using cryptocurrency as payment option, government officials are more interested in the affairs of the exchanges therefore more eyes are on them (the exchanges).

Gambling sites handle less funds compared to exchanges and they're not easily used to launder money when compared to exchanges too. Also when they're in charge of funds, they aren't held for a longer period since most games don't take that long to end and payout area made almost immediately.

Given that most crypto gambling sites operate outside of the law KYC isn't really required.
Very few site operators even bother making a person sign off that they are of legal age.

KYC is safety program to avoid money laundry and multiple account, I agree with that but in gambling world KYC can become the worst thing. Theory and reality are different, there's fact gambling users is people under 18 or person who want to do criminal in gambling site. Gambling is industry and only need fresh fund to run money circulation fast, if KYC become rules, money will send into their competitor who not include KYC. Not all people want their ID save by other even for fun and money, included me.

so fauecethub did shutdown ? oh damn i didnt knew it but i was using it a long time ago and the site was succesful  .

this site were mainly a faucet and not really a gambling site but they are being forced to do a kyc while the actual gambling site arent really  . however a real gambling site are also being enforced to have thier licenses  . having a licenses is i think not also easy and harder than enforocing a kyc but still many gambling sites dont have a license and a kyc yet but this makes thier credibility lessen compare to those who have it .

If I am not wrong more than 85% gambling site have ventage on their terms and conditions regarding KYC even though they aren't forcing you for KYC at the beginning. Very rarely you will found gambling site who is against KYC. Those do not ask KYC totally then most likely they have no license or they aren't forced from government or licensed authorities to implement KYC system. To be honest I am really not familiar why governments, exchange, gambling or any other crypto related sites asking for KYC, what is the exact goals expect so called money laundering.

I think it's because of the money inside the exchanges and gambling site. Perhaps, the exchanges save the customers money, and that money is not going anywhere, so they need to implement KYC/AML. People give the money to the exchanges in large amounts, so the exchanges feel it requires them to know who their customers. But for the gambling site, the money will be at the house or the players, so when the house gets the profit from the player, they will keep that profit from themselves. That will be the same if the player wins, they will keep the profit for them, and they will withdraw the money.

Presumably the cost of implementing KYC/AML runs into billions or either because it is "hassle" at somehow to the gamblers that would like to play, but requires first to do KYC in which is embarrassing.

In general, majority of the gamblers hate KYC. They tend to avoid those gambling sites that demands it, so that's why gambling owners don't implement it because gamblers will just avoid them and just go through other gambling sites that don't require KYC.

You mean, possession here? But you have a point here. Very few gamblers can really win big time and most of the time when that happens, the casino will ask for certain documentation to validate the user. And I think, that is unfair. But we can't argue with them because in their Terms and Conditions, they will put a statement that they have the right to request further details from their player, when the situation calls for. And they have all the right to do that because they are holding your funds. And if the site has no intentions of releasing the funds, they will make all sort of excuses.

Like the famous saying " the house always wins" the chances of losing all your money to them is high so KYC isn't really a priority because it will remain in their procession except in a few instances where players win and forced to undergo KYC before being able to withdraw their winnings.

There is some slight difference.
Chances of someone losing money in gambling sites is very high as compared an exchange(some people store money in them then withdraw while others exchange for other coins, very few actually do active day trading). That's why there is no pressure by gambling sites to impose KYC/AML on customers because many never get to withdraw it.

But i think you have already seen a number of cases where someone makes a big winnings and tries to withdraw. That's when you start seeing KYC verification kicking in most gambling platforms.

Definitely. Since they are online gambling, the government will be hard to control or give pressure to them. Moreover, some of them may be totally anonymous and don't know where they basically. So, in this case, who will force them to implement KYC/AML? While for exchanges, they are commonly known to register in a certain country. Then, it will be easy to handle them doing KYC/AML. (IMHO as an amateur) 

In my own view, it's because there is no pressure from the government. No hard and strict regulations imposed. Different from how fiat gambling is regulated.

Unlike in exchanges, gambling sites don't really hold their user's funds for a long time. It's like a gambler will just deposit on their gambling session, play and withdraw right away. If their user loses, no one to blame but themselves. Compare to exchanges where sometimes it was treated by a wallet by anyone, users here at least need protection.

But this is only my view as we all know gambling sites and exchange site does have a different nature on which the latter really needs a strong implementation of KYC for an obvious reason.

Is there really such a big difference ? I don't think so.

Now with payment processors it is maybe different, but with exchanges vs. gambling sites, I don't see any differences. It depends on what the people behind those sites are trying to do and what are their longterm plans. And if they are bothered with laws and authorities can get a hold of them, when they break or not follow the laws

There are exchanges and gambling sites that are run anonymously more or less, so forcing them to implement KYC/AML is not easy, if they feel safe and are ok with operating in a grey area.  

Lets assume, there was indeed a difference. You would then have to think about, what customers are trying to achieve by using their service, because there is a big difference imo. When using a payment processor/exchange, you are getting something in return, that has more or less the same value and people are thus more worried with the legitimacy of the site. KYC/AML, like it or not, gives your site just this legitimacy to a certain extent. So to grow and get some market share, implementing KYC/AML will help you. You will lose some customers, who refuse to go through this process, but the majority will swallow it and it gets you a lot of possible customers in the future (because your site is considered legit and people trust you with their money).

In contrast to that, people who use a gambling site, will get nothing in return (just some fun maybe ), they will lose their money sooner or later. This leads to them not being too worried with the legitimacy of the site they are playing at. The gambling site itself doesn't have to worry too much with KYC, because their business is just running fine without KYC/AML.

There is certainly more to it, but in the end it comes down to business decisions, if you are surrendering to the pressure from governments or not.

I'm a bit curious here. Why is it easier (compared to exchanges, payment processors, etc.) to run a gambling site without being forced to implement KYC/AML?

I even remember FaucetHub (A service that allowed you to create your own faucet) shutting down some time ago because they were being pressured into implementing KYC just because they were "storing" funds for users, even though, most of the payments that the users were receiving were "dust payments". So again, how is this any different from gambling sites?