The many ways COVID-19 is affecting the gambling industry

As the coronavirus dubbed COVID-19 continues its march across the globe, its effects are being felt both in terms of healthcare and economics.

The world's stock markets have all about crashed while nervous investors seek to dump stocks and buy up bonds. Sports leagues are making plans to play in empty stadiums and arenas. And of course, the gambling industry in some parts of the world has tanked.

With no end in sight, gambling industry leaders are worried that it might take an exceptionally long time to recover once COVID-19 is officially a thing of the past. Land-based casinos are likely to take the longest to overcome the damage. Still, the entire gambling industry is hurting right now.

It is not just one thing causing all of the problems. It's a combination of things: the virus itself along with government warnings of pandemic, travel fears, active decisions to shut down places of public gathering, and so forth. COVID-19 has created a perfect storm of events that is having an undeniable effect on nearly every form of gambling.

Please note that gambling is a recreational activity and your health is far more important. Stay safe folks!

Land-based casinos across Asia

It is well-known that most of the damage done by COVID-19 has occurred in Asia. China remains the hardest hit nation of all. Its gambling industry has also been devastated. In Macau, a southern resort city that relies on gambling for the majority of its economic activity, losses have already hit the millions . It has been estimated that when all is said and done, gambling losses and the amount of money the city will have to spend to help residents get back on their feet could reach $6 billion.

At one point, every casino in Macau was closed. People were not traveling in or out of the city either. Thankfully, that much has ended. Casinos were recently allowed to begin reopening after agreeing to take certain steps to maintain the highest standards of hygiene. It appears as though all but one casino has resumed operations.

Having said that, being open for business does not necessarily mean customers are once again flooding back to casino floors. They are not. Macau casinos probably won't return to full capacity until global travel bans are eased. Until then, Macau gamblers will likely be limited to Chinese nationals and customers from neighbouring Asian countries.

Casino operators in other countries are working as hard as they can to keep their doors open without helping to spread COVID-19. In both Atlantic City and Las Vegas, extra precautions have been implemented. If you have ever lamented less-than-clean washrooms in hotel casinos, you will not run into such issues now. Washrooms should always be so clean.

Online casino gambling

There is a bit of a silver lining here. Even though land-based casinos are struggling, online casinos are not having to worry about spreading the coronavirus for obvious reasons. One would expect online operators to see a slight bump as a result of gamblers not traveling to land-based casinos. Whether or not such a bump has occurred is unknown. We do not have any hard-and-fast numbers to look at yet.

Such number should be available when quarterly accounting takes place at the end of March. Do not be surprised to see that the most popular online casinos have done very well since the start of the year. Even smaller, lesser-known casinos will probably report an increase in business for the quarter.

It is not beyond the realm of possibility that coronavirus could turn a whole new crop of gamblers on to playing video slots and table games online. Gamblers who would have otherwise never joined an online casino might discover that they prefer the online model over visiting land-based casinos. And even if traditional gamblers do not convert to the online model full-time, at least they will know they have a viable option when getting to a casino is not possible.

Online gambling with crypto

You might be wondering if COVID-19 has had any impact on gambling with cryptocurrency. Again, there is no hard-and-fast data to say one way or the other. However, we can speculate based on the things we do know. Let us begin with the premise that cryptocurrencies generally perform inversely to stocks and shares. In other words, investors losing faith in their stocks generally results in better performance among cryptocurrencies.

Unfortunately, such is not the case this time around. Bitcoin's price hovered around $10,000 just a few weeks ago. At the time this post was written, it was sitting at about $5,000+. Bitcoin has lost 40% of its value in just the last few weeks - coinciding with stock markets now approaching bear territory.

How does this affect cryptocurrency gambling? Bitcoin is no different from fiat in terms of how people react during times of fear. People afraid of total economic collapse will stop spending their cash. Indeed, they might even hoard it. That is what fear does. Likewise, the same fears can grip cryptocurrency owners. That appears to be what is happening now.

Some investors are pulling out of crypto markets to put their money into less volatile assets, like bonds for example. Those choosing to hold onto their coins are not likely to spend them until they are confident that the threat of economic collapse has passed. So it is quite possible that fewer people will be spending their cryptocurrency tokens at online casinos. Most will probably sit on their coins until everything passes.

This is not to say that online gambling will suffer significant losses as a result of COVID-19. In fact, such a scenario is quite unlikely. But there is reason to believe that fewer gamblers will be spending their Bitcoin. They will make fiat deposits instead, knowing that fiat isn't going to lose as much value as their digital currencies could potentially lose.

The upside of all of this is that Bitcoin will come roaring back when all of this is over. Holding onto one's coins now is a wise strategy that should pay off big in the long run. COVID-19 will pass and, when it does, Bitcoin will be on the precipice of the much-anticipated halving event. Prices should more than rebound in a short amount of time.

COVID-19 and sports betting

One last thing to consider is how COVID-19 is affecting sports betting, both online and at land-based betting shops. Experienced sports bettors know that bookmakers set their lines based on multiple criteria they analyse and consider in a big picture scenario. One of the criteria they look at is home team advantage.

There is a generally accepted rule within the sports betting community that the home team has a slight advantage by virtue of playing in front of a friendly crowd. How much of an advantage that translates into for purposes of real scoring depends on the sport and the teams playing a particular match. The advantage can be as little as a point or as high as five or six points.

All of this matters because sports leagues are starting to take action to protect fans. Football (soccer) fans in Spain were the first to learn that they would no longer be welcome at games. Matches will be played to empty seats for the foreseeable future. In the U.S., the much-anticipated NCAA basketball tournament will also be played to empty seats. The NBA has even gone to the extreme by suspending its a season until further notice.

Bookmakers now have to consider whether or not home teams playing to empty seats have an actual advantage. Any advantage home teams are given will probably be minimal at this point. According to a recent report on the Mass Live website, U.S. bookmakers generally give a three-point advantage to home teams. It is expected that the advantage will be reduced to either 1 or 1.5 points as a result of playing to empty seats.

Reducing the advantage will change betting lines in nearly every sport. While it might not seem like much, cutting home team advantage in half might mean the difference between making some bets and staying away from others. Sports like basketball and soccer already offer the slimmest of margins of victory. Cut the home team advantage in half and that margin is made even slimmer.

COVID-19 will eventually pass

The good news in all of this is that COVID-19 will eventually pass. It could be that the virus has already peaked in China, where factories are reopening and people are returning to the streets. Macau casinos are back open and ready to welcome guests. Now we wait to see the progress of the virus in other parts of the world.

Whether COVID-19 panic was warranted or not, one thing that cannot be argued is that the virus has had an economic impact on a variety of industries. It most certainly has impacted land-based gambling at casinos from Asia to North America. The impact has been less noticeable in the online gambling sector. We will not know the true impact of the virus until we start seeing hard numbers come in.

By this time next year, we will likely be talking about how well the gambling industry has recovered. In all likelihood, things will be back to normal. Casinos will be humming, online operators will be expanding their reach, and Bitcoin gambling will be back in full swing. Let's hope that this is the case not just for the sake of the gambling industry but for all industries, jobs, and prosperity.