Decentraland hits the jackpot with virtual casinos
Future. Dealing with crypto can be a big gamble, so it’s no wonder that one of the most popular places in the Decentraland metaverse are virtual casinos… even though Decentraland doesn’t hold a gambling license. It skirts around the regulations by requiring players to buy an NFT of virtual clothing that can be used to unlock tokens to play. It’s an innovative workaround, but as the metaverse grows in popularity, the attention paid to this gambling gray area might be increasing as well.
Metaverse Hold ‘em
The most visited place in Decentraland (a third of the platform’s 600,000 users) is the casino, specifically what the platform dubs “ICE Poker.”
- To join a game, players “must buy (or borrow) a piece of virtual swag sold by the casino — a hat, sunglasses, shirt, cigar — that can later be sold for cryptocurrency” (MANA in Decentraland).
- Each piece of swag is on sale for roughly $5,000 on Decentraland’s website — as an NFT, of course.
- As players win chips, either by beating opponents or in-game challenges, they can use them to upgrade the swag so that its value increases… thus being able to sell it for more.
- Swag holders can also lend out their NFTs to others, giving them a cut of the borrower’s earnings.
So far, Decentraland has paid out $15.4 million to players. Additionally, players are “never negative,” since the chips aren’t directly correlated with money. Losing is just a “missed opportunity” to make money.
Gamble on a gamble
Decentraland gets around gambling laws because the poker game is technically “play to earn” — distinguishing between the purchase of the NFT to gain access to play and receiving the chips to actually play. Previously, the virtual casinos did have blackjack and roulette, but the company nixed those in January to avoid regulation (Decentral Games, which runs the casinos, doesn’t have a gambling license).
But legal experts say that Decentraland is still playing with fire. Attorney Jeff Ifrah told Bloomberg that “any contest or prize predicated on ‘buying in’ constitutes gambling. If you have to buy in to participate in a contest, even if the chips are free, the purchase of a prerequisite to play is a problem.”