How to deal with bitcoin/crypto volatility as an online casino? Let's say an online casino has btc as a deposit and withdrawal method.
Assuming A player deposits 1 btc, plays and does neither win nor lose much and then cashes out the balance, which happens to be exactly 1 btc. I am using simple values to focus on the main issue.
However, the btc price was 15% volatile since the deposit was made.
Technically, the player has neither won nor lost based on game play, but he would get a free 15% in value just due to the btc price increase.
The opposite applies if btc loses 15% of value.
Of course it is a nice thing for the casino if the btc price plummets, but potentially disastrous if the price goes up, assuming an average 4% house edge for the casino.
What would be a fair solution for both parties?
Edit: The main game play would be slots, but the same problem arises for Black Jack, Roulette and sports book events. Poker could be affected to a degree as well.
There is no crypto to fiat conversion. An option would be to convert the bitcoin to a Casino token, but fiat is off the table .
Do players gamble in USD or in BTC?
If players gamble in BTC then it is not your problem to deal with. You just deal in BTC and take a cut of the BTC. If the player who wins BTC ends up losing USD, that's not your problem - just like if a player goes to a European casino and wins EUR but then loses money after converting to USD, it's not the casino's problem.
If players gamble in USD and use BTC only as a transfer mechanism, then you should have some sort of financial mechanism to hedge against price changes. For example, you could sell the BTC as soon as you get it, and buy more BTC when players withdraw.
I am not a lawyer and this is not legal advice.