Online casino

From Wikipedia, the free encyclopedia

Online casinos, also known as virtual casinos or internet casinos, are online versions of traditional ("brick and mortar") casinos. Online casinos enable gamblers to play and wager on casino games through the Internet.

Online casinos generally offer odds and payback percentages that are comparable to land-based casinos. Some online casinos claim higher payback percentages for slot machine games, and some publish payout percentage audits on their websites. Assuming that the online casino is using an appropriately programmed random number generator, table games like blackjack have an established house edge. The payout percentage for these games are established by the rules of the game.

Reliability and trust issues are commonplace and often questioned. Many online casinos lease or purchase their software from well-known companies like Microgaming, Realtime Gaming, Playtech, and CryptoLogic Inc in an attempt to "piggyback" their reputation on the software manufacturer's credibility. These software companies either use or claim to use random number generators to ensure that the numbers, cards or dice appear randomly.

Contents 1 Online casino types 1.1 Web-based online casinos 1.2 Download-based online casinos 1.3 Live-based casinos 2 Games offered 3 Bonuses 3.1 Signup bonuses 3.2 Sticky bonuses 3.3 Cashable bonuses 3.4 Cash back bonuses 3.5 Casino lottery 3.6 Comp points 3.7 Bonus hunting 3.7.1 Casino games 3.7.2 Sports betting 3.7.3 Poker 3.8 Bonus abuse 4 Randomness Control 5 Fraudulent online casino operator behavior 6 Fraudulent online casino player behavior 7 Legality 8 See also 9 Notes 10 External links

[edit] Online casino types

Online casinos can be divided into three groups based on their interface: web-based casinos, download-based casinos, and more recently live casinos. Some casinos offer multiple interfaces.

[edit] Web-based online casinos

Web-based online casinos are websites where users may play casino games without downloading software to the local computer. Games are mainly represented in the browser plugins Macromedia Flash, Macromedia Shockwave, or Java and require browser support for these plugins. Also, bandwidth is needed since all graphics, sounds and animations are loaded through the web via the plugin. Some online casinos also allow gameplay through a plain HTML interface.

[edit] Download-based online casinos

Download-based online casinos require the download of the software client in order to play and wager on the casino games offered. The online casino software connects to the casino service provider and handles contact without browser support. Download-based online casinos generally run faster than web-based online casinos since the graphics and sound programs are located within the software client, rather than having to be loaded from the Internet. On the other hand, the initial download and installation of a download-based online casino client does take time. As with any download from the Internet, the risk of the program containing malware does exist.

[edit] Live-based casinos

Live-based casino gaming allows web players to interact with games played in a real world casino environment. Online players can see, hear, and interact with live dealers at tables in casino studios worldwide.

[edit] Games offered

A typical selection of gambling games offered at an online casino might include:

• Baccarat
• Blackjack
• Craps
• Roulette
• Online slot games
• Online poker

[edit] Bonuses

[edit] Signup bonuses

Many online casinos offer signup bonuses to new players making their first deposit. These bonuses normally match a percentage of the player's deposit with a dollar maximum, and almost all online casino signup bonuses require a minimum amount of wagering before allowing a cash out. Gameplay at specific casino games might be excluded from the wagering requirement calculation.^{[citation needed]}

A fictional signup bonus offer follows as an example:

• The online casino offers new players a deposit matching bonus of 100%, up to $100
• The player must wager 25 times the total amount of the deposit plus the bonus before withdrawing
• Wagers on baccarat, craps, roulette, and sic bo do not count towards meeting wagering requirements

For this particular example, this would mean that a player depositing $100 would start with $200 in his account. The player must make $5000 ($200 × 25) in wagers before being allowed to make a withdrawal.

Some bonuses require no deposit to claim them. Types of no deposit bonuses include^{[citation needed]}:

• A no deposit in pure monetary form, for example $10.
• Free spins no deposit, this is where they allow free spins on particular games, and then allow you to keep the winnings.
• Play for a predetermine period of time with x amount of dollars.

[edit] Sticky bonuses

Non-cashable bonuses are often called "sticky bonuses", and are the most common type of online casino bonus.^[1] Sticky bonuses can be bet, but cannot be cashed out. When the player makes a withdrawal, the sticky bonus is typically removed from the withdrawal total. A player might receive a 100% match sticky bonus on a $100 deposit with a wagering requirement of $2000. While meeting the $2000 wagering requirement, the player could bet both the deposit and the sticky bonus. When cashing out, the $100 bonus would be removed from the balance. If the player cashed out $300, $100 would be subtracted out, leaving $200. The player is not allowed to cash out a balance of below $100 since no cash would remain after the bonus is removed.

The benefit of a sticky bonus can be explained as financial leverage: if the player deposits $100, receives a $100 (100%) match, and then earns 50% gambling (so they now have $300), then cashes out, they have earned $100 on their initial deposit of $100, for a 100% gain: the sticky bonus has doubled or "levered up" their gain.

The average return of a sticky bonus is sometimes expressed in terms of a target gain. Average return = (chance of reaching target) * (target - bonus - deposit - wagering requirement * house edge) - (chance of not reaching target * deposit). With a target of 2x(bonus+deposit) and 50% chance of reaching the target, the equation reduces to 50% * (bonus - wagering requirement * house edge). Expressing in terms of chance of bust and "element of risk", the formula for return becomes bonus * chance of bust - average wagering * element of risk.^[2]

The sticky bonus described above that is removed after wagering is sometimes known as a "phantom bonus." There are other variations of a sticky bonus in which you do not need to exceed your original balance to make a withdrawal. Instead any win is immediately cashable.^[3]

Compare cashable bonuses/non-cashable bonuses to stake returned/stake not returned free bets.

[edit] Cashable bonuses

A rarer, but more valuable type of casino bonus is the cashable bonus.^{[citation needed]} Cashable bonuses can be cashed out after completing a wagering requirement. A casino might offer a 100% match bonus up to $100 with a wagering requirement of $2000. After wagering $2000 in the casino, the player is able to cash out the $100 bonus.^{[citation needed]}

Cashable bonuses often restrict play on certain games.^{[citation needed]} Wagers made on roulette, baccarat, craps, and sic bo usually do not count towards the wagering requirement because these bets give the player the opportunity to simultaneously bet on winning and losing outcomes, greatly reducing variance.^{[citation needed]} For example, betting on both red and black in roulette. Wagers on games with a low house edge, like blackjack and video poker, are also often excluded. Some casinos increase the wagering requirement above the default for low-house-edge games.

On games without raises or doubles, the expected loss while completing a wagering requirement is wagering requirement * house edge. This makes the expected gain of a cashable bonus equal to bonus - wagering requirement * house edge. House edge is defined in terms of initial bet, so the above equation does not apply to games with raises and doubles where the final bet size may be larger than the initial bet. The equation becomes bonus - wagering requirement * average loss per wager. WizardofOdds.com has proposed calling the latter average loss per wager variable "element of risk".^[4] For a more precise estimate, one must also consider the benefit from being able to bet the bonus prior to completing the wagering requirement. This effect becomes noticeable when making large bets, such as betting the full balance (deposit and bonus) in a single bet. After considering this benefit and "element of risk", the formula for return becomes bonus - average wagering * element of risk.^[5] If games without raises or doubles are played and the bonus is not given until completing wagering, then the formula can be simplified as bonus - wagering requirement * house edge.

[edit] Cash back bonuses

Cash back bonuses are given following a player loss. A portion of the player's loss is returned, often as cash. For example, a casino might offer a 25% cash back bonus each week. Any player who had a loss over the course of the week, would receive 25% of his loss back. Any player who had a win over the course of the week would not receive a bonus. Cashback bonuses are rare.^[6]

[edit] Casino lottery

A Casino lottery, like bonuses, is aimed at reducing the casino's house edge. Participation in a lottery is generally free, but prizes usually depend on the player's bet size while playing casino games. Casino lottery terms are simple, just like a regular lottery. The player needs to select a certain amount of numbers from a group of numbers. The online casino has a specific multiplier ratio for each amount of correctly guessed numbers. For each correctly guessed number the ratio is multiplied by the player's bet size. The resulting amount is transferred to the player as a bonus. Because a lottery reduces the casino's house edge equally for all games, the bet sizes are generally calculated for games that have the same house edge. The multiplier for correctly guessed numbers is determined depending on this house edge.^[7]

[edit] Comp points

Comps are commonly available at land-based casinos, but also exist online. Comp points can usually be exchanged for cash, prizes, or other comps.^[8] The amount of cash given per wager is usually very small and often varies with game selection. A casino might offer three comp points for each $10 wagered on slots and one comp point for each $10 wagered on blackjack. The casino might give $1 for each 100 comp points. This example is equivalent to returning 0.3% of wagers on slots and 0.1% of wagers on blackjack.

[edit] Bonus hunting

Bonus hunting (also known as bonus bagging or bonus whoring) is a type of advantage gambling where turning a profit from casino, sportsbook and poker room bonus situations is mathematically possible. For example, the house edge in blackjack is roughly 0.5%. In the example above, $5000 in wagering with a house edge of 0.5% will result in an expected loss of $25. Since the player received a $100 signup bonus, after subtracting the expected loss of $25, the player has an expected gain of $75.

[edit] Casino games

Online casinos offer players signup bonuses as incentives to play. These are usually one-off bonuses for signing up to the casino and opening an account. The terms and conditions attached to each bonus vary but share two common features:

• Restricted games or bets.
• Wagering requirements.

Wagering requirements prevent players from withdrawing the bonus money immediately after receiving it. Before the bonus money can be withdrawn the player must wager a certain amount of money on unrestricted games. The wagering can be spread out over many bets. To meet a $2000 wagering requirement, a player could make 1000 $2 bets on blackjack, provided blackjack is not a restricted game.

Games like blackjack and video poker have a low house advantage. The house advantage for blackjack is ~0.5%. So in the example above, by playing $2000 worth of blackjack with a house advantage of 0.5%, a player is, expected to lose $10 in total. But the expected value is an average value and may be less than the actual value. Risk of ruin is an important topic that comes into play.

Assuming that the player only loses an amount close to the expected loss, and the bonus awarded to the player after meeting this wagering requirement is greater than $10 then the player profits. The process is mathematically calculated. Bad luck could cause a player to lose more than $10 playing blackjack in this situation. The run of luck is subject to variance and follows a normal distribution.

[edit] Sports betting

By taking advantage of 'free' bet promotions, users can back the event, and then lay the event on a betting exchange, at similar or same odds, thus ensuring that their 'free' bet is not a bet at all, instead more like a financial trade. No matter the outcome, it is possible (by using a betting / arb calculator) to calculate both the possible outcomes before the sporting event has started. By inputting the odds, the bet calculator then tells you what amount to bet, to ensure that whether the bet wins or loses, the return is the same.

[edit] Poker

See the online poker article for a discussion of poker bonuses.

[edit] Bonus abuse

A large portion of online casino disputes relate to bonuses.^[9] Casinos may label players who win using bonuses as "bonus abusers." Both players and casinos may commit fraud. An example of player fraud is creating multiple accounts and using the accounts to claim a sign-up bonus several times. An example of casino fraud is changing terms of a bonus after a player has completed the wagering requirements, then requiring the player to meet the new bonus terms.^{[citation needed]}

[edit] Randomness Control

A randomness control system allows players to confirm the randomness of the game’s results. This kind of control allows players to confirm the randomness of numbers or order in online casino games.

Randomness control uses the SHA-256 algorithm (Secure Hash Algorithm family). The basis of the method is that the player receives the checksum of the sequence that he is going to play before he begins the play (in roulette he gets the numbers that the ball lands on, and in card-based games, he gets the deck.) The checksum is computed with the help of the SHA-256 algorithm that consists of 64 symbol codes (256 Bits), for example:

e3b0c44298fc1c149afbf4c8996fb92427ae41e4649b934ca495991b7852b855

The checksum for each sequence is unique. It is virtually impossible to find two sequences with identical checksums. Therefore, the SHA-256 algorithm is generally applied for the confirmation of the authenticity of information and for forming digital signatures.

After a game, the player has access to all the elements of the earlier formed sequence. He can check whether the game was held according to the plan indicated in the sequence. Next, he computes the total sum of sequence on the basis of the SHA-256. If this sum is identical to the one received before he began play, he can confirm that the elements’ sequence which had been formed prior to the beginning of the game was in fact the one used in the game.

Players can use programs to compute the checksum for text information according to the SHA-256 algorithm. Players can find such programs on several websites ^[10][11][12]

The SHA-256 is merely one of numerous algorithms that can be used to compute a checksum, but it is trustworthy as no modern sources of information have ever uncovered any insecurities or incorrectness connected with this algorithm.

[edit] Fraudulent online casino operator behavior

Fraudulent behavior on the part of online casinos has been documented. The most commonly reported behaviors are refusal to pay withdrawals or cheating software with rigged payouts. An online casino with multiple confirmed cases of fraudulent behavior is often called a rogue casino by the online casino player community.^[13]

One commonly reported behavior related to refusal to pay withdrawals is the refusal to pay withdrawals promptly. A rogue casino may intentionally delay a withdrawal in hopes that the player will continue gambling with the money in the account and lose it all back. Other rogue online casinos attempt to not pay their customers by retroactively applying unfair terms to their house rules.

Cheating software appears to be less common than payout problems.

Some casino software has been mathematically proven to cheat, such as Elka System/Oyster Gaming and Casino Bar.^[14] Screen shots from the back office of an older brand of software indicated the odds could be adjusted by the operator.

Many casino gambling portals and player forums maintain blacklists of rogue casinos.^[13][15][16] While some carry more authority than others, most blacklists constitute individual webmaster and player opinions rather than anything official from any type of regulating body.

[edit] Fraudulent online casino player behavior

The following are forms of fraudulent player behavior and security breaches which may lead to the temporary or permanent deletion of a player account ^[17]

Multiplier Player Accounts – This is when one user creates multiple accounts to take advantage of bonuses or new player account promotions. These players are often detected through similar signup information or the use of the same computer or IP address. Players that create multiple accounts are also sometimes referred to as “bonus hunters” or “bonus whores”. This is why many online casinos attach wager or rollover requirements to bonuses to limit the number of bonus abusers creating multiple player accounts.

Shared Computer – Online casinos will not allow 2 or more players from the same household to have player accounts, unless they are able to verify their identity through verification. Verification often includes verbal correspondence via telephone, and/or the submission of documentation (Driver’s license, passport, credit card statement or utility bill) via fax or e-mail. Online casinos may also request verification prior to a payout to verify a player’s identity.

Invalid payment information (Incorrect banking information, unauthorized use of credit card) – Often player accounts are disabled and winnings seized if they are found using invalid payment information. If you attempt to use your spouse or friend’s credit card, the online casino will reserve the right to disable your account and seize any winnings you may have generated. If you had lost your balance, the online casino may put your player account in a negative balance which you will need to repay using a payment method that belongs to you. Never use somebody else’s credit card to fund your player account if your name does not appear on the bank statement for the card. If it is a shared bank account but the debit card does not have your name on it, make sure your name at least appears on the bank statement which you may be asked to submit as verification to the online casino. If you are using a business credit card, you must ensure you are the authorized user of said business. You may need to submit a business license with your name showing that you are part owner of the business.

Disconnection Abuse – A player may have their account disabled if the online casino finds that they are disconnecting in the middle of a hand to avoid losing the hand. If the online casino finds that you are repeatedly disconnecting in the middle of hands, they will disable your account and you will not be reimbursed for the funds lost during the specific hands.

[edit] Legality

See online gambling for a discussion of the legality of playing at an online casino.

[edit] See also

• Comps (casino)
• Problem gambling
• eCOGRA (e-Commerce Online Gambling Regulation and Assurance) a non-profit industry regulatory body

[edit] Notes

[edit] External links

• Online Casinos at the Open Directory Project