Malta has thrived in the iGaming industry for almost two decades, but there is a new potential player in town. The march of blockchain technology has been compared by many to the beginning of the internet – it won’t be just a huge driver of economic growth, but it will change the way we do everything, from handling data to the structure of the banking system.
The World Economic Forum estimates that by the year 2025, at least 10 per cent of the global GDP will be managed and facilitated through blockchain technologies.
Malta has managed to carve its economic success through an economic vision based on the power of regulation and jurisdictional innovation. The dedication of the government, the support of the public, and the business sector allowed the country to thrive in the regulated industries.
The iGaming industry has been a backbone of the Maltese economy for many years now and has seen the country becoming an internationally renowned jurisdiction for the registration and operation of iGaming companies. Currently, Malta is looking at repeating this success yet again by creating a regulatory framework for blockchain-based businesses, virtual currencies and ICOs.
There exist some similarities between blockchain and iGaming regarding their popularity and the way in which they have grown and could grow in the future. The iGaming industry was initially regarded with cynicism and scepticism, but with time, and adequate regulation and adherence to legal standards, it has gone on to flourish and become a massive part of the Maltese economy.
Blockchain technology is similar in some respects. A new, and to some, unknown bit of tech, it has made waves across the business community, and while some are wary of it still, it is being adopted more and more by leading companies and businesses. Its potential is vast and far-reaching, and if Malta can position itself at the right time, and in the right way, it can be set to reap the benefits of what the future will bring.
The iGaming sector was regarded with suspicion in the early days, but now, without it, the economy would not be in the same, healthy shape that it is.
It is expected that with the introduction of the government’s blockchain strategy, as well as the quick uptake of the technology from local businesses, Malta will soon lead the way in this exciting new sector. This means that not only will it improve its reputation as a digital leader, but it will also bring a massive boost to the economy and create more jobs. This is precisely what iGaming did.
Blockchain will also boost other industries that complement it – hardware, software, marketing, legal, financial, the list goes on for those stakeholders that will be able to grow and nurture their businesses when blockchain takes off.
It is unlikely that iGaming and blockchain companies will compete in the traditional sense of the word. They are entirely different industries and as such require very different legal, creative, and administrative staff. Additionally, the client base would not be affected either as the concepts are so different, it is unlikely that iGaming would lose any business to the world of the blockchain.
It is expected that the introduction of the new blockchain frameworks will influence the existing regulations around the iGaming industry. These new proposals will also provide the iGaming industry with faster, cheaper, and more efficient alternatives to traditional payment methods which will revolutionise the way in which they both take payment, and pay out winnings. Rather than pitting the two industries against each other, legislators and stakeholders need to find a way to ensure they complement each other and offer new ways to do business, and to grow their respective sectors.
Already the seeds of cooperation are being sown, and some iGaming platforms are preparing to use the Distributed Ledger Technology to their advantage. One of the primary improvements will come to the most burden area of iGaming – trust. By using smart contracts, gambling platforms can use a distributed public ledger that is entirely transparent and allows users to see the information freely at any time. Those that will increase levels of fair gambling will automatically win their customers’ trust and position themselves at the forefront.
One area, however, where there may be a bit of overlap is the talent pool. Currently there is a considerable shortage of developers that are capable and trained in matters of the blockchain. Blockchain start-ups are offering considerable salaries to those that can do the job, and this could result in a situation where developers and programmers involved in the creation of iGaming products, could be tempted to hone their skill set and jump ship to the blockchain.
While blockchain as a technology cannot be regulated as such, its use and scope can. Yet the key is not to stifle its potential and ensure it remains as a catalyst for further innovation.
By combining these two industries, we can create a fairer and more transparent gambling sector with a more secure and open infrastructure.
These two industries combined will be of a considerable benefit for Malta economically, socially, and in the world of business. It is already on the map for its iGaming industry, but with the country taking huge strides into the ICO, blockchain and cryptocurrency industry, it is set to solidify its reputation as a world leader in innovation.
Megan Frydel is brand manager at BiteMyCoin.
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