News Summary for June 2021: Online Gambling, Crypto & Payments

Fast Offshore brings you the top news from Payments, Online Gambling, Blockchain in June 2021.

bullet Online Gambling News

Malta added to FATF grey list in severe blow for iGaming companies

Malta has been added to the FATF grey list in a shock decision taken last week. Despite coming out with good marks from the Council of Europe’s MONEYVAL evaluation, the FATF has decided to place the country into enhanced monitoring. This is a significant blow for the country’s iGaming, financial services, crypto and fintech sector, and anyone established there. 

Malta is the first among its peers to be placed on the list, ranking alongside Albania and Panama. It’s expected to cause problems for online gambling operators as the ranking will make it harder for them to do business, therefore making the previously coveted MGA license less valuable.

 It also means there is an increased risk of over-regulation as authorities grapple with trying to meet the requirements laid down by the FATF.

Germany’s gambling laws pave the way for first licenses

As of 1 July, Germany’s Treaty on Gambling will come into force. The new legislation will pave the way for licensing sports betting, slot machines, and online poker in the private sector. Licenses issued under the rules will be valid at a federal level, throughout the country while the competent body will be the authorities in the state of Saxony-Anhalt. 

The authority made public the requirements for obtaining a license for poker and virtual slot machines. So far, casino games like roulette and blackjack are not covered in the scope of the law. As expected, acquiring a license is challenging and includes a full financial breakdown and a significant amount of supporting paperwork. Only applicants based in the EU or EAA can apply for a license.

eSports betting platform to go public on Toronto Stock Exchange

Online sports betting and eSports platform, Rivalry LTD has announced plans to go public on the Toronto Stock Exchange. The company just finished a round of fundraising, which yielded $22 million in subscription receipt financing from two Canadian firms. The money will remain in escrow for four months, during which time the country must list its shares publicly. 

The company was founded in 2018 and is currently valued at more than $150 million. The company generates the vast majority of its revenue from eSports betting, mainly League of Legends, Counter-Strike, and Dota 2. The rest comes from betting on sports events such as football and basketball.

The company has also released its own casino game, highlighting the benefits of diversity in the online gambling sector. A spokesperson for the company said most customers are under 30, from Brazil, Chile, Mexico, Russia, and Peru.

eSports “fastest-growing” sector in the online gambling world

New figures from a leading market research company suggest that the eSports streaming industry is set to be the fastest-growing vertical within the online gambling world. Valued at some $150 billion, analysts believe the number of online streamers will continue to increase, reaching 1 billion by the end of 2025. This, in turn, will increase betting. 

The fastest-growing region is Asia-Pacific, followed by Latin America. In terms of other revenue streams, that derived from media rights and sponsorship is also set to be promising. Some of the biggest names in the market are eSports Technologies, Rush Street Interactive, Skilz, Corsair Gaming, and Super League Gaming.

Platforms can remain competitive by offering sports and gaming events, thus helping them be exposed to new audiences.

bullet Blockchain & Crypto News

China is set to launch digital yuan early next year

China is expected to launch the world’s first major central bank digital currency, the digital Yuan, in February 2022 at the Beijing Winter Olympics. It will be pegged to the fiat yuan, and payments will be made via QR code, swipe, or tap. This comes at the same time the US is rumoured to be pondering the digital dollar, although it seems likely Beijing will pip them to the post.

The launch of such a currency and to such a broad audience will signify the most significant step towards mainstream adoption to date. Should the US follow suit, then this could have exciting repercussions for trade between the two countries, as well as the forex sector.

Concerns have been raised that digital currencies could give governments too much information on what their populations are spending. Due to the use of blockchain networks to transact, all information would remain and be public- for the authorities.

Record two quarters of funding and valuations for blockchain companies

Chainalysis, a blockchain analysis firm, has been valued at a staggering $4.2 billion. This comes after it completed three rounds of funding in the last seven months, amassing some $365 million. Back in November last year, the company raised $100 million and was valued at $ 1 billion, a total it doubled by March 2021. Today, in June, it stands at over $4 billion demonstrating impressive growth and growing confidence in the sector. 

The recent valuation comes amid other industry success stories such as Circle raising $440 million, BlockFi raising $350 million, and Solana, some $314 million all in the last three months.

“The future of finance and national security will be based on blockchain data-driven decisions,” Co-founder and CEO of Chainalysis Michael Gronager said. “We’ve harnessed the transparency of blockchains to provide actionable insights into markets, threats, and business opportunities.”

bullet Payments News

PwC call ePayments the epicentre of industry transformation

The financial services sector is in the middle of a big shift, sped up by the COVID-19 pandemic, but with electronic payments at the center. Increased digitalization is leading the way as payments become increasingly digital. While we have some way to go before cash becomes obsolete, digital money is drawing significant interest. As a result, the entire payments infrastructure is being reshaped.

A survey conducted by PwC found that we were already happily using cashless payments before the pandemic. Text payments, QR code payments, or app-based transfers showed that the will to embrace a digital economy was already there. They predict that cashless transfers will increase by 80% in the next four years to 1.9 trillion. 

As a result, businesses of all sizes need to be ready. This includes supporting mobile phone access, embracing digital currencies including Central Bank issued ones, providing integration with digital wallets, and low-cost, instant, cross-border payments.

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