Twitch's Crypto Investment: Bitcoin's Future?

Twitch is a live-streaming service that was acquired by Amazon for $970 million. It is one of the most popular places on the internet, with millions of people using the app every day for various activities, including live-streaming their favourite games. In recent years, Twitch has expanded its offerings to include crypto gambling, and streamers are paid by casinos to participate in this activity. Additionally, Twitch now accepts Bitcoin as a payment option and allows streamers to receive cryptocurrency donations. The integration of cryptocurrency into Twitch's platform is part of a broader trend of crypto adoption and enables new use cases, such as automated investing and Twitch integration. Twitch's co-founder, Justin Kan, has also expressed interest in the institutional investment case for crypto and has launched a gaming NFT marketplace called Fractal.

Twitch streamers can now tip with four cryptocurrencies

Twitch, the live-streaming service acquired by Amazon, has long been crypto-friendly. In 2014, it added the option to pay for subscriptions using Bitcoin. Now, Twitch streamers can receive tips in four cryptocurrencies: Bitcoin Cash (BCH), Ethereum (ETH), Litecoin (LTC), and Bitcoin Core (BTC). This is made possible through Streamlabs, the app of the streaming giant, which has integrated with Coinbase to act as a payment processor.

To receive crypto tips, streamers need to link their Coinbase and Twitch accounts. Crypto tips will function in the same way as regular tips and are non-reversible. While Streamlabs does not charge a fee, some network transaction fees may apply, and Coinbase may charge a fee to convert cryptocurrency into fiat currency. Streamlabs is currently present on around 15% of all Twitch streams and paid out nearly $35 million in tips in the first quarter of 2018.

The addition of crypto-tipping is part of a broader trend of crypto gambling on Twitch, with gambling becoming the seventh most popular content category on the platform. Twitch's integration with crypto is also reflective of blockchain technology's ability to address concerns related to traditional payment systems, such as intermediary control of private data and personal funds.

Crypto gambling on Twitch

Twitch's relationship with gambling has been a source of controversy for years, with critics arguing that it can be a gateway to addiction for young viewers. In September 2022, the platform announced that it would update its policies to specifically prohibit streaming gambling sites that include slots, roulette, or dice games that aren't licensed in the US or other jurisdictions with sufficient consumer protection. However, this ban does not include sports betting, fantasy sports, poker, and chance-based games like licensed slots or dice.

Despite the ban, crypto gambling is still flourishing on Twitch, as it is not specifically prohibited by the platform's terms of service. This is in contrast to competitors like YouTube and Facebook Gaming, which prohibit streaming online gambling sites that have not been previously reviewed. Additionally, Twitch's gambling-related categories, such as slots, have no age limit to prevent younger viewers from watching.

The rise of crypto gambling on Twitch has led to concerns about the potential risks for consumers, especially vulnerable adults and underage children. Gambling experts argue that it is Twitch's responsibility to police content that is either illegal, unregulated, or potentially harmful to its users.

Some streamers have expressed mixed feelings about the presence of gambling on Twitch. While some have benefited financially from partnerships with crypto gambling sites, others have chosen to distance themselves due to moral concerns. Matthew "Mizkif" Rinaudo, a Twitch streamer, decided to stop working with online crypto casinos despite the lucrative opportunity, stating that "morality came into play" and that gambling was "different" from his other sponsorships.

Crypto donations on Twitch

Crypto donations are becoming increasingly popular on Twitch, and there are several ways to set them up. Crypto transactions are frictionless, as users don't need to set up any additional accounts if they already have a crypto wallet. Twitch creators can easily share their wallet address with viewers to solicit crypto donations.

Streamlabs is one of the most popular ways to set up crypto donations on Twitch. It has released an integration with Coinbase, allowing you to accept donations in four main cryptocurrencies: Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. When you receive a donation through Streamlabs, the cryptocurrency is deposited into your Coinbase account. Streamlabs does not take a fee from the donation; the only fees are the transaction fees of the cryptocurrency the viewer donates. When using Streamlabs, you will also get donation alerts when you receive a crypto donation.

Another way to accept crypto donations is by adding your wallet address to your channel description on Twitch. The Bitcoin wallet address is recommended if you opt for this method, as it is the most popular and widely accepted cryptocurrency. However, the biggest downside to this method is that there is no easy way to integrate it with your alerts on Twitch, so you may not notice any BTC donations while live streaming.

NowPayments is another Crypto Payments platform that allows you to accept crypto donations and gives you access to Dashboard and Reporting Features. By using this platform, you can get a Donation Button embedded in your channel description, which is likely to convert higher than something like a wallet address. NowPayments accepts 50+ different cryptocurrencies, including BTC, ETH, BCH, LINK, LTC, USDT, and many more.

Finally, the Brave browser's built-in rewards system, Brave Rewards, makes it easy for viewers to tip their favourite Twitch streamers with crypto. Brave users can tip Twitch streamers directly with Basic Attention Token (BAT) that they earn from viewing private ads while browsing. By registering as a Brave Creator, viewers enrolled in Brave Rewards can seamlessly tip you with BAT.

Crypto payments on Twitch

Twitch, the Amazon-owned streaming platform, has been strengthening its crypto strategy by offering a 10% subscription discount to users who pay with cryptocurrency through its payment processor, BitPay. This move positions Twitch as the first major global brand to offer a crypto-based promotion, signalling its interest in attracting more crypto users to the platform.

Twitch's relationship with crypto has been somewhat tumultuous, with the platform removing and then later re-enabling crypto payment options in 2019. Despite this, the company's recent initiatives indicate a growing embrace of cryptocurrency. For example, Twitch caters primarily to the gaming community, a space where blockchain-based games and the use of digital assets in virtual worlds are becoming increasingly popular.

To enable crypto payments, Twitch users can utilise services such as NOWPayments, which allows them to accept cryptocurrency donations for their streams. With NOWPayments, users can choose from over 50 cryptocurrencies, including Bitcoin, Ethereum, Litecoin, and XRP. The service also offers lower fees compared to traditional donation systems, which typically use USD, EUR, or GBP.

Another payment processor that has integrated with Twitch is 8Pay, which enables crypto to be sent directly from the spectator's MetaMask wallet to the streamer's wallet. This integration is expected to revolutionise streaming donations, with 8Pay also planning to expand to other streaming platforms like YouTube.

The adoption of crypto payments on Twitch reflects the growing trend of cryptocurrency usage in the gaming and streaming communities, providing users with more options to manage their funds and support their favourite streamers.

The rise of crypto gambling on Twitch

Twitch is one of the most popular places on the internet. Millions of people use the app every day to watch live streams, play video games, and even solve math problems in real time. Traditionally, Twitch has been known as a platform for gaming. However, recently, it has been stepping into the online gambling arena, with crypto as its currency. Gambling has become the seventh most popular content category on Twitch, and crypto gambling is leading the way.

Crypto casinos are websites where gamblers can purchase cryptocurrencies like Bitcoin and Ethereum to use in digital games of chance like slots, blackjack, and baccarat. These casinos are paying popular streamers to play casino games on their channels, with some streamers receiving tens of thousands of dollars an hour. Streamers are also advertising sponsorship deals from crypto gambling websites, and some streams attract more than 100,000 live viewers.

One example of a streamer who has been crypto gambling is Tyler Niknam, known as Trainwrecks to his 1.5 million followers. Niknam played slots on Stake.com, an online cryptocurrency casino and his most prominent Twitch sponsor, to live audiences of 25,000. He often won large sums of money, sometimes as much as $400,000 in crypto in one go. However, Stake does not possess a gambling license in the US, and Niknam and other US gamblers had to use VPNs to access the site. This may constitute promoting illegal gambling, according to legal experts.

Another streamer, Matthew "Mizkif" Rinaudo, said he was offered $35,000 per hour to do gambling streams for 10 hours over the course of a month. He also stated that sponsors were putting money into his crypto casino account and that he would advertise affiliate links with attractive discounts. Despite the lucrative opportunity, Rinaudo decided to stop working with online crypto casinos in June, citing moral concerns.

Twitch has stated that it is closely monitoring gambling content and that it strictly prohibits illegal content and activity on the service. However, Twitch does not specifically ban gambling streams, and crypto gambling is flourishing on the platform.

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