Online Poker Players Demand Bitcoin Payouts

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Last Updated on 21 November 2020 by CryptoTips.eu

Jeroen Kok

Jeroen is one of the lead copywriters on Cryptotips.eu and discusses all recent events in the crypto market. This includes news updates, but also price analyzes and more. He developed his passion for cryptocurrency during the bull run in 2017. He has learned a lot since then. The combination of cryptocurrency and creative writing is perfect for Jeroen and an excellent way to share his knowledge with a wide audience. Find me on LinkedIn / jeroen@cryptotips.eu
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One of the more surprising Bitcoin purchasers in these past few weeks have been gambling companies. That may sound strange, but if you know that online poker players are supposed to write up their winnings on their tax forms themselves, it becomes more understandable.

The website Winning Poker Network (which claims to support “the best poker rooms in the world“) is officially registered in Costa Rica, but most of its players are Americans (although gambling is illegal in most US states). It is by now buying millions of dollars per day in Bitcoins in order to pay them out to players.

CEO Phil Nagy declared on Bloomberg that:

Right now 90-95% of our payouts are people asking for Bitcoin because it’s going up. We are constantly having to go out and buy Bitcoin — lots. Lots. More than we’ve even had to before.

Advertentie.

IRS searches

Critics claim that gambles hope in this manner to avoid a visit from the IRS (Internal Revenue Service) who have started to ask for crypto income on yearly tax forms. The Winning Poker Network admitted that players are supposed to file their own winnings and losses.

“we don’t regulate that,” CEO Nagy admitted, before adding that it could indeed be harder for US authorities to track Bitcoin than other funds. His company is currently exchanging about 100 million dollars in Bitcoin on a monthly basis.

Then again, the poker sites seem to be hoping for a steady Bitcoin price rise, because in case of a selloff the story reverses of course.

Nagy explained:

When Bitcoin drops or does something significant, inevitably, we have people send us $100,000 or $200,000 in Bitcoin, because it’s the fastest way to liquidate it. And we are kind of stuck with it.