2021 was the year that saw massive growth in several areas. With many of us subjected to lockdowns and unable to venture far, we turned to iGaming and online casinos. This gave the industry a significant boost even though it has been seeing consistent growth over the last decade. With the growth in interest in iGaming, the UK Government has already revealed plans to introduce new regulations in the coming year. As it stands, the best payout slots in the UK are already subject to strict regulation from the UK Government, but it appears that there is more to come.
Other areas that saw exponential growth in 2021 were cryptocurrencies, NFTs, and meme stocks. People who had little idea that these things even existed found an interest last year and began to push values up and up. These are areas that are almost free of legislation, but with such an increase in popularity, that is something that is set to change. Let’s take a look at what could be on the horizon.
iGaming regulations set to be tightened
The iGaming industry in the UK is regulated by the UK Gambling Commission. This body exists to ensure that operators are acting fairly and that vulnerable people are protected. There is a need to prevent people from falling into issues that can be caused by gambling. The aim is to prevent gambling addiction and all of the problems that come with this. With rules already in place, there are some that feel that they don’t go far enough.
We are due to see a white paper in 2022 that will outline proposed changes to how online casinos and sportsbooks operate. It is likely that we will see the end of free bets. It is more than likely that there will be changes in terms of how operators are able to advertise. There is also more than a little chance that there will be stake limits imposed meaning that players may be restricted to wagering £2 per spin on a slot or on a hand of cards. These changes are, to some extent, a natural progression given what is already in place, but what of the world of crypto and NFTs? With these areas there is no starting point so what can we expect to see?
New opportunities, new regulations
The crypto boom and the rise in NFTs are something that regulators have been unable to ignore. There is no desire to stop people from investing and profiting. The concerns are that, without regulation, people are losing money and losing big. There are questions around the extent to which people understand what they are investing in. It is perhaps the case that many are just jumping on the bandwagon with very little understanding as to what they are investing in. This is something that regulators want to stop.
At present, there are moves to restrict advertising. The concern is that riches being portrayed can draw in the vulnerable who are unable to afford the potential losses that are associated with investing. Alongside more controls over advertising, we are likely to see a more joined-up approach from the Bank of England, the treasury, and the Financial Conduct Authority. This joining of forces will allow for a full assessment of any potential regulations that may be required.
Why 2021 was the year that brought concerns
For some, 2021 proved to be a very profitable year. It was a year when they put into action what they had previously studied and they went on to make money in crypto, NFTs, and meme stocks. As this continued to happen, there was more and more media attention. The result? Those with little to no knowledge thought that it would be good to get in too. While some may have fallen lucky, others lost big. Let’s have a look at the key facts from 2021 and why they have triggered calls for regulation:
These were something that were pretty much unheard of prior to 2021. They certainly made themselves known as the year went on and became renowned for the boom and bust phenomenon. How do meme stocks come into being? We have social media to thank. Investors start to generate interest on platforms such as Reddit and they begin to almost manipulate the stock price of a chosen company. As more people come on board, the higher the stock prices are pushed.
The prime example of this is 2021 can be seen by looking at GameStop. Investors kept piling their cash into stocks of this company and this led to an astounding 400% increase in value in a single week. At the end of 2021, GameStop was still up over 800%. There were newbie investors late to the party who will have overpaid for stock and will, at some point, risk significant loss.
2021 was the year of crypto. Bitcoin skyrocketed and hit an all-time high. This saw Ethereum explode and set its own record all while we saw the rise and rise of meme coins too. The likes of Doge and Shibu Inu saw rises that have never been seen before. The latter saw an increase of over 49 million percent! This saw a rush of others investing in such coins but, having missed the boat, they were never going to benefit in the way that early investors had.
Aside from these increases in value, crypto hit the mainstream during 2021. The likes of PayPal began to deal with Bitcoin whilst this crypto could also be used to buy a car. The fact that day to days uses have grown has left governments keen to introduce some form of regulation.
Non-fungible tokens were all over the news in 2021. The truth, however, is that many still don’t fully understand them. This is despite the fact that they are ploughing significant funds into them on a daily basis. NFTs have changed hands for tens of millions of dollars. While there is this potential attached to them, interest will continue to grow.