Global payments platform Paysafe has launched a new cryptocurrency payment method for online gaming operators in the U.S. market.
Pay with Crypto, powered by MoonPay, is intended as a solution for online gambling operators to offer their customers the ability to use their preferred stablecoin or cryptocurrency to fund their player accounts, in jurisdictions where such funding is permitted. It allows deposits in USD Coin (USDC), other stablecoins, or any major cryptocurrencies to be rapidly converted to U.S. dollars to allow play on online sportsbooks, casinos, or daily fantasy sports platforms.
Via the MoonPay technology and the Paysafe Gateway, players are able to connect their crypto or custodial wallet to fund the deposit. MoonPay’s Commerce Checkouts technology also supports transactions via QR code. Operators can choose to settle payments almost instantly in stablecoins in their business’s crypto wallet or settle in U.S. dollars.
After selecting Pay with Crypto and their preferred stablecoin or cryptocurrency, players simply connect their crypto or custodial wallet to fund the deposit, with the MoonPay Commerce Checkouts technology also supporting transactions via QR code using users’ phones. Once transactions have been verified, Pay with Crypto instantly converts crypto deposits into U.S. dollars to fund the player account.
Research finds strong demand for crypto funding
Recent research from Paysafe noted that more than eight in 10 U.S. online gamblers (83%) would like to have crypto payments available as an account funding method.
“Galvanized by the growing popularity of stablecoins, cryptocurrency is evolving in the U.S. from an investment asset into a unit of value for payments, and we’re seeing this shift gather pace in the country’s iGaming market,” said Paysafe President of Global Gaming Zak Cutler. “Against this backdrop, we’re delighted to unveil Pay with Crypto, a forward-thinking solution that strongly positions U.S. operators for their customers’ changing transactional preferences – the future of how they pay when they play.”
Pay with Crypto adds to Paysafe’s portfolio of payment options for gaming operators, which already includes card payments, the Skrill digital wallet, the PaysafeCash eCash solution, a Pay by Bank product, and more than 30 local payment methods.
DraftKings rolls out crypto conversions
Cryptocurrency is not widely used in U.S. state-regulated sports betting, but some state regulators allow direct account funding via that method, such as Wyoming, Colorado and Virginia.
This year, DraftKings began rolling out a new feature that allows users in some states to use cryptocurrency converted to cash for online sports betting. It initially launched crypto-to-cash conversion in Illinois, Kentucky, New Hampshire and Vermont.
Regulators from the Kentucky Horse Racing & Gaming Corporation and the Vermont Department of Liquor and Lottery told SBC Americas that their rules consider crypto conversion to be permissible “cash equivalents”, and that they approved DraftKings’ launch in their states.
Other states ban any form of crypto for online gambling. For example, the Massachusetts Gaming Commission (MGC) banned crypto converted to cash as a permissible funding source for sports betting accounts effective Dec. 19 after a review and a staff recommendation. The director of the MGC’s Investigations and Enforcement Bureau (IEB) said at a commission meeting in January that the regulator believes that “crypto is not ready for primetime”, citing concerns over a comparative lack of regulations and fears over money-laundering potential.
Is crypto rising as credit cards fall?
The use of cryptocurrencies or crypto conversions for U.S. gambling comes as numerous states across the nation clamp down on a popular existing form of funding: credit cards.
Last Friday, Maine Gov. Janet Mills signed into law a ban on using credit cards for either online sports betting or the state’s approved but yet-to-launch online casino market. Maine joins an array of states to eliminate credit cards for online gambling via legislation or regulation, including Massachusetts, Vermont, Tennessee, and Illinois. Others including Colorado, Maryland, New Jersey and New York have considered bills this year to prohibit them, and Virginia’s legislature sent an approved ban to their governor’s desk last month.
DraftKings, FanDuel, and BetMGM have all banned credit cards usage for online sports betting nationwide since last summer.
