The Laws Related to Bitcoin
On a global level, with respect to gambling, there are no specific laws. Therefore, it would not be incorrect to assume that bitcoin gambling and traditional currency gambling would fall in the same domain. As such, if traditional gambling is permitted in your region than by default the same should apply for bitcoin gambling too. But there are countries like Canada and Australia who have banned online gambling but in such cases, bitcoin gambling which is anonymous comes in handy for the users. It is seen that countries have come up with confusing policies related to online gambling and bitcoin gambling. As such, it makes the fact apparent that the legislating politicians are majorly out of touch with online gambling and its realities. Also, generally it is seen that wherever online gambling is banned, in fact online gambling is supposedly very popular in those countries. Rather it is felt that legalization in favor of online gambling can be an all round benefitting proposition.
It is recommended that with a regularized taxation framework and systematic liberalization policy, online gambling can actually contribute towards raising revenues to the government and also provide the users with protection laws. But there is a general lack of interest in the matter and also the associated religious and moral influences give the issue a politically sensitive nature.
Is bitcoin gambling in threat from regulations?
Law enforcement, apparently does not want to target the individual gamblers. With the history of the gambling crackdowns it is apparent that the target is the site operator and not the individual user of the online gambling site. This can be exemplified by the fact that when Ultimate Bet, Full Tilt Poker, Pokerstars were busted, the authorities attacked the gambling sites and the individual users were not touched. The online gambling operations in traditional currency are curtailed by the authorities by limiting the ability of the gambling site users in gambling transactions. The involved financial institutions and payment processors are penalised by the authorities. But this is not possible with online bitcoin gambling as then this would require accessing the domains and the servers or a physical house or office raid. However, with the development of censorship resistant technology such as midsafe and namecoin, the technology is advancing to decentralised DNS and hosting whereby the above mentioned measures will prove futile.
Are the bitcoin gambling license jurisdictions applicable across borders?
Globally, the common phenomenon is that those companies which have been licensed for online gambling services, claim that they can operate in other countries, as the laws of other countries are not applicable on them. As they are licensed from one country, they are under the jurisdiction of that particular country and even if they have users from other countries, they do not fall under their jurisdiction. Alternatively, the legal system is of the opinion that because the services of the gambling website are being availed of in a specific country, it implies that the website is operating in that country. Also, irrespective if they have a license in a different country and the business server is located elsewhere, they do fall under the jurisdiction of the operating country.
Similarly, even the media, local gambling operators and the politicians of a country try to taint the reputation of such gambling sites that are operating in countries other than their licensed territories. This is not fair on licensed online bitcoin gambling websites, which have put in effort to obtain license. The Isle of Man, Malta, Alderney, Curaco, The Northern Territory of Australia, Gibraltar, The Philippines are the international centers with low taxation for online gambling. And Costa Rica, Easter Europe and Panama are the main centers of online gambling industry.