Crypto Gambling Glossary: 30 Key Terms Explained
Plain-language definitions of the 30 most important terms you will encounter in crypto gambling, from house edge and RTP to provably fair, oracles, gas, and rug pulls.
Crypto gambling combines the vocabulary of traditional gambling with blockchain and DeFi terminology. New readers often encounter these terms without clear definitions, or with definitions written by operators trying to sell something. This glossary is written to inform, not to promote.
Terms are grouped by theme. Each definition is intentionally brief; where an article explores a concept in depth, a link is provided.
Gambling Fundamentals
House edge The mathematical percentage of every bet the casino expects to keep over the long run. A 1% house edge on a $100 bet means the casino expects to profit $1. Because it is mathematical and permanent, no strategy eliminates it. See house edge and RTP explained.
RTP (Return to Player) The complement of the house edge, expressed as a percentage returned to players. An RTP of 97% means the house edge is 3%. RTP is a long-run average across millions of bets — it does not predict any individual session.
Variance (volatility) How much individual results deviate from the expected average. A high-variance game (e.g., a slots jackpot) produces large wins and long losing streaks. A low-variance game (e.g., blackjack) produces smaller, more frequent swings. Variance does not change the house edge.
Wagering requirement (playthrough) The number of times a bonus must be bet before winnings can be withdrawn. A $100 bonus with a 30x wagering requirement means $3,000 in bets must be placed first. High wagering requirements often make bonuses worthless in expected-value terms.
Rake The fee a poker room takes from each pot, typically a small percentage up to a cap. Crypto poker platforms take rake just as traditional ones do; the medium does not change this mechanic.
Bankroll The total funds a casino holds in reserve to pay winning players. Casinos with inadequate bankrolls may be unable to pay large wins — a significant risk with small or anonymous operators.
Fairness and Randomness
Provably fair A cryptographic verification system allowing players to confirm that game outcomes were generated before a bet was placed and were not manipulated. Requires a server seed, client seed, and nonce. See how provably fair works.
Server seed A random value generated by the casino before a game round begins. It is hashed (see below) and shown to the player before the bet, then revealed afterwards so the player can confirm it was not changed.
Client seed A value contributed by the player (or generated by the player’s browser) that is mixed with the server seed to produce the final outcome. Its purpose is to ensure the casino cannot predict the final result even if it controls the server seed.
Nonce A counter that increments with each bet, ensuring every outcome in a session is unique even when the seeds remain the same.
Hash / hashing A mathematical function that converts any input into a fixed-length output (a “hash”). Hashes are one-way: you cannot recover the input from the output. Casinos publish the hash of the server seed before the game so players can verify it was committed in advance.
RNG (Random Number Generator) Software that produces unpredictable numbers for game outcomes. Traditional online casinos use certified RNGs; provably fair systems replace or supplement these with cryptographic seed systems.
Blockchain and Crypto Basics
Wallet (non-custodial) Software or hardware that stores a user’s private keys, giving them direct control of their crypto without any third party. Examples: MetaMask, Ledger. If you lose your private key or seed phrase, access is permanently lost.
Private key A secret cryptographic string that authorises transactions from a wallet address. Anyone who has your private key controls your funds entirely.
Gas (gas fee) The fee paid to the blockchain network to process a transaction. On Ethereum, gas prices fluctuate with network demand. High gas fees can make small on-chain bets economically irrational.
Smart contract Self-executing code deployed on a blockchain that runs automatically when conditions are met, with no human intermediary. Some gambling platforms use smart contracts to enforce game rules and payouts. See smart contracts in gambling.
Oracle A service that provides real-world data (sports scores, price feeds) to a smart contract, which cannot itself access information outside the blockchain. Oracles are a critical trust point — a corrupt or compromised oracle can corrupt any game that depends on it.
Stablecoin A cryptocurrency designed to maintain a stable value, typically pegged 1:1 to the US dollar (e.g., USDT, USDC, DAI). Gamblers use stablecoins to avoid the price volatility of assets like Bitcoin or Ether while still transacting on-chain.
On-chain vs off-chain On-chain means the action (bet, payout, game logic) is recorded and executed on a public blockchain. Off-chain means it happens on private servers; only the result or settlement might be recorded on-chain. Most crypto casinos are primarily off-chain.
Casino and Platform Types
Custodial casino A platform that holds your deposited funds on your behalf, like a traditional online casino. You trust the operator with your money. If it is hacked or exits, your funds are at risk.
Non-custodial gambling Betting via a smart contract where the player’s funds are locked in the contract, not held by an operator. The contract enforces rules automatically. Carries smart contract risk (bugs, exploits) rather than operator risk.
Originals Games designed and built in-house by a crypto casino, typically dice, crash, plinko, or mines. Originals are more likely to use provably fair systems. Margins vary widely.
Third-party slots Slot games licensed from traditional game studios (e.g., Pragmatic Play, Hacksaw). These run on conventional RNG software and are not provably fair. RTP figures may or may not be disclosed.
Risk and Harm Concepts
Rug pull A fraudulent exit in which an operator or project team removes all liquidity or funds and disappears. Common in DeFi and token-based gambling projects. Leaves players with worthless tokens or empty accounts.
KYC (Know Your Customer) Identity verification procedures requiring players to submit government ID and proof of address. Required by regulators in most jurisdictions. Many crypto casinos bypass KYC, removing regulatory accountability alongside the friction.
AML (Anti-Money Laundering) Legal requirements to detect and report suspicious financial activity. Licensed casinos must comply; unlicensed crypto platforms often do not. This makes some crypto platforms attractive to those seeking to obscure the origin of funds — a legal risk for ordinary users caught in the same ecosystem.
Chasing losses Increasing bet sizes or session length in an attempt to recover previous losses. A dangerous psychological pattern that increases exposure to the house edge and is a recognised sign of problem gambling.
Self-exclusion A formal process allowing a player to ban themselves from a gambling platform or group of platforms. Robust in regulated markets (shared databases), largely absent in no-KYC crypto gambling. See responsible gambling.
DeFi and Advanced Terms
Liquidity pool Funds deposited by multiple providers into a smart contract to act as the “house bankroll” for a decentralised gambling platform. Providers earn a share of the house edge; they also bear losses when players win. See DeFi gambling.
Prediction market A platform where participants buy and sell shares in the outcome of future events (elections, sports, price levels). Distinct from casino gambling but involves similar psychological and financial risks. See prediction markets.
Token economy A system where a crypto casino issues its own token, used for governance, staking rewards, or rakeback. Tokens create circular incentives and may be used to inflate apparent platform value. Treat casino-native tokens as high-risk, speculative assets.
This glossary covers the vocabulary you need to read any article on this site critically. For a deeper look at how the core financial mechanics work, see house edge and RTP explained, and for the full picture on platform risks, visit the risks and harms section.