Many will enter an online casino, register and then start playing without thinking much about it. If you are like us, looking for a deeper understanding of how online casinos work, you’ve come to the right place.
Having worked in several online casinos we know that the key to a good experience lies in understanding how things are tied together. By knowing this you will be able to set correct expectations, avoid mistakes and to an extent, become a better player.
In our guide on how an online casino works, we will cover subjects such as game providers, slot machines, return to player, bonuses, licensing and more.
If you feel like this might be above your skill level, you can always check out our beginners guide to online casino.
If you are interested in truly understanding online casinos, we recommend you read the entire guide front-to-back, as well as the supplementary guides you will find along the way.
Contents
Introduction
Have you ever thought about how an online casino works from the inside? Who decides which games to provide? Who decides how much I should receive in bonuses? How do they make money? In this article, you will learn the answers to these questions and more.
But before someone can decide these things, the online casino has to become legal. That is why we will discuss the legality of online casinos as well as regulations and laws the online casino have to comply with.
We mentioned earlier that we have created a lot of supplementary guides to go with this main guide on how casinos work. To make this article more digestible while still covering all the details that go into running a casino, we have summarized the topics on this page, while allowing you to dig deeper into each subject by clicking on the provided links.
We wish you a good read and hope that our experts here at AllGambling can give you a better understanding of how online casinos work.
LICENSE, LAWS & REGULATIONS
Before an online casino becomes legal, it needs to be licensed and regulated by a gambling authority. For you, the Malta Gaming Authority and the Curacao Gaming Authority will provide the gambling license required to become legal in your country.
LICENSING
To find out whether the online casino you play at or the online casino you consider becoming a member of is legal, you can simply check the footer section of their casino lobby and look for one of the following logos.
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In addition to providing the logo of their licensing authority, any legal online casino must make their license and registration number available to users. This is because both have a register where online casino players can check the legality of their website.
LAWS & REGULATIONS
Most online casinos have their headquarters in Europe, and to legally offer casino services in your country, they have to comply with EU laws & regulations. All of which are there to protect you and your well-being.
One prominent law these online casinos have to comply with is GDPR. This law makes sure your personal information is stored securely, and have little to no risk of getting in the hands of criminals.
Another important law is The Act Against Fraud & Terror Funding. This law is the one forcing online casinos to verify their players before they pay out deposits to their accounts. By making sure the recipient of the money is the same as the depositor, they make sure that online casinos aren’t being used to fund criminal organisations.
It also prevents people from hacking into your account to withdraw your money into their own bank account.
Read more about licensing, laws & regulations in our deep dive into the subject.
GAME PROVIDERS ROLE IN AN ONLINE CASINO
When an online casino has all the paperwork ready to qualify as a legal online casino, they can go ahead and put their product together.
The core of every online casino product is the games they offer, which makes the casino game providers incredibly important for both online casinos and for the customers.
Although every game provider claims to be the best in the world, experienced casino players will surely know that there are big differences in quality between them.
Game providers are responsible for both producing, maintaining and operating the games at an online casino. Slot machines need design, features, and an algorithm allowing players to win money, while live casino games need that in addition to live hosts, a studio and a functioning live stream.
In other industries you find suppliers giving stores discounts, in order for them to arrange promotions for their customers. In the iGaming industry, the providers create bonuses and tournaments on their games, allowing the online casinos the possibility to run these promotions for you and me.
If you find the game providers role incredibly interesting and want to learn more about them, you can read our comprehensive guide on game providers.
HOW SLOT MACHINES WORK
Slot machines are an important part of any online casino and you may be interested to learn more about how they work.
The definition of an online slot machine is a gambling machine, ran by the RNG (Random Numbers Generator) algorithm, allowing you the chance to both stake money and win money.
Although there are many similarities between them, there are different categories of slot machines available in online casinos. If you want to learn more about how slots work or want to know more about the differences between these categories, you can dig into our extended guide on how slot machines work.
If you only want to scrape the surface of how these entertainment machines work, you can simply keep reading.
You start the slot machine by choosing how much you want to stake. Once you have done this, you click the ‘Spin’ button, and the slot machine will do exactly that. On your screen, it will look like symbols randomly landing in different spots.
In reality, the click of the spin button triggers the computer to select a random number. That random number represents an outcome. This outcome becomes visible to you through a pre-recorded video.
Great thinkers might have already figured this out, but that means that whenever you sit there and watch re-spin after re-spin waiting for a jackpot, the computer has already decided that you have won it, and all you see is the replay of it happening.
HOW LIVE CASINO GAMES WORK
Live casino games have a lot in common with slot machines, in terms of being games you can gamble money on to give yourself a chance to win even more money. However, if you have visited one before, you also know that they are very different from online slots.
A live casino game is a game that is live-streamed from either a real casino or a studio. The hosts as well as tables, cards, wheels and other props are real.
While a win on an online slot machine is determined by the random numbers generated by your click, the outcome of a live casino game is even more random, as it’s not controlled by any computer.
In this category, you may find games such as online blackjack and roulette, which is just a live-streamed version of the real game.
You can learn more about how live casino games work in general or dig into the details on how to play individual games through our guide on how live casino games work.
HOW RTP & HOUSE EDGE WORK
We understand that neither Return To Player (RTP) or House Edge are the sexiest information when learning about how online casinos work. However, it might be the most crucial information when it comes to truly understanding how it’s all tied together.
As with every business, an online casino has to make money. While a player is happy with leaving profits to chance, the online casino has bills to pay, employees to give salary and so on. That is why they can’t leave their profit to chance.
You may have heard about House Edge before. This is what makes online casinos make money over the long run. The professional expression for this is Theoretical Return To Player (RTP).
The RTP is a percentage of the total wagering on a game, expected to be paid out over 1 billion spins. This means some will be paid back above 100% of what they wagered, while others will be paid out less than what they wagered. The average, however, will end up around the RTP provided in the information of that game.
The most common RTP for a game is around 96%. However, you can find games with both a higher and a lower return to player. The remaining percentage represents the House Edge, making it likely for an online casino to earn a 4% profit over 1 billion spins in this example.
The house edge is crucial information to everyone hoping to make a profit in an online casino. That is why we highly recommend a deeper dive into our guide on RTP, Betting Margins and House Edge.
HOW ONLINE CASINO BONUSES WORK
If you are looking for how you can use a bonus you have received, you should check out our deep dive into the subject. However, if you want to scrape the surface in order to get an understanding of why they exist, what their purpose is and how they work, you are good to keep reading.
Casino bonuses are an online casinos way of making you feel welcome with them. It also gives the operator a golden opportunity to remind you of their existence.
A welcome bonus can be compared to a greater, most commonly found outside a hotel or at a restaurant. At the same time as they tempt you to play, they provide a great opportunity to say “You are welcome with us” without having to say it.
A retention bonus is a group of bonuses you can receive while you are a customer.
Some bonuses are given for free as a gift. Online casinos will do this if they want you to try a game they believe you will like or simply because you haven’t been playing with them for a while, as a reminder of how fun it can be playing with them.
Other bonuses require an action, most commonly a deposit. These bonuses are in the category of “If you scratch my back, I’ll scratch yours”.
How the different bonuses works are individual to the online casino you are playing with, however, many of them give out the same kind of bonuses, making our guide on casino bonuses a good read.