Around a decade ago, as online casinos started to become more popular, a project was launched to eradicate the so-called “house edge”.
Edgeless.io was a cutting-edge, blockchain-powered casino that sought to create a nominal house edge of close to zero in a bid to enhance transparency and create a more even playing field for players to operate on.
By 2024, however, neither this project nor the concept as a whole have made much progress in the crypto betting space. But will such an objective ever be achieved, or is it a fanciful pipe dream that’s based on a misunderstanding of the house edge?
Getting Started – Understanding the House Edge and Your RTP
The house edge refers to the mathematical advantage that enables casinos to remain profitable. In simple terms, it translates into an average loss percentage that each player can expect from their initial bet, with this also impacting their core return-to-player (RTP) rate.
Both the house edge and RTP rate are calculated over an extended period of time, while these two entities are closely related to one another. For example, let’s say that you leverage one of the latest 1xbit casino offers and start playing the ‘Book of Dead’ slot with an RTP rate of 96.6%.
This means that you can expect to recoup $96.60 for every $100 wagered on average when playing this game, while you can also use this rate to calculate the slot’s unique house edge. Simply subtract the RTP rate of 96.60% from a value of 100, which in this case reveals a house edge of 3.40%.
Although the house edge and RTP rates vary from one game to another, you can see how each title sees players lose money for every $1 or $100 that they wager.
Why a ‘Zero’ House Edge is Problematic
As we’ve touched on, the house edge creates a nominal mathematical advantage for sportsbooks and guarantees them a profit on all losing bets over an extended period of time.
So, there’s an immediate issue with the notion of eradicating the house edge at crypto casinos. After all, it may prove difficult for such entities to achieve a viable profit, while lowering the house edge would squeeze their returns and margins considerably.
At the same time, it should be noted that the house edge doesn’t reflect an arbitrary value that’s set by the sportsbook. Instead, it’s dependent on the rules and format of each individual game, with the house edge typically lower when playing games of chance, such as blackjack. Some blackjack iterations offer house edge values of less than 1%.
So, it would be impossible to create an ‘edgeless’ crypto casino in the digital age, not unless operators created entirely new games and verticals that were structured in a way that removed the house edge naturally. Of course, some crypto casinos have developed bespoke games of this type, but these have yet to gain widespread popularity.
Instead, crypto casinos should focus on their strengths, which include creating far greater transparency for bettors and reducing deposit and withdrawal fees. The latter helps players retain all of their winnings and has an incremental impact on their ability to maximize profits!
