Online poker has a trust problem, and the blockchain is here to solve it.
A company called Virtue Poker is currently holding a token sale to fund the development and marketing of a blockchain-powered poker platform that prides itself on fair play. In the same way that cryptocurrency technology keeps financial transactions honest and transparent, the same technology can be used to keep digital card sharks out of online gambling.
The first step in playing online poker isn’t to place a bet, but to top up an account balance by sending money to the company. “This requires an extraordinary level of trust,” said Ryan Gittleson, co-founder and CEO of Virtue Poker.
“Online poker sites have stolen hundreds of millions of dollars from players over the years.” It’s true: there’s no shortage of scandalous examples of poker site owners unfairly scamming players out their money. Naturally, blockchain technology can come to the rescue.
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Virtue Poker doesn’t hold a player’s money in any main account. Instead of sending their funds to the company directly, players send them to a smart contract on the Ethereum blockchain that handles payouts automatically and without human involvement. There’s no room for abuse of mismanagement on the platform—blockchain technology ensures that all money goes exactly where it’s supposed to go.
Secondly, Virtue Poker is a decentralized poker environment, which makes it nearly impossible for hacking and other foul play to be useful. There are more than a few stories of “superuser” accounts that unfairly let some players see which cards are in play, or which cards are next to be dealt.
But Virtue’s digital decks are shuffled in a distributed manner. “Since the deck isn’t on a central server, a hacker would have to simultaneously hack all players in the game and break multiple levels of encryption,” says Gittleson.
Virtue Poker isn’t interested in being a legal trailblazer—Gittleson said the company “will operate wherever we are able to operate legally, and we’ll get gaming licenses as needed.”
But what of the existing major players, like PokerStars? According to this CEO, they’ve got their work cut out for them if they want to compete on the blockchain front: “To do what we have done, PokerStars would need to create an entirely new platform and implement it in a space where they have no experience and no edge.
And for such a move to make sense, PokerStars would have to leave their entire current infrastructure behind—a difficult move for any company and a gut-wrenching move for the market leader.”
This article has been republished with permission from Modern Consensus.