We all have a friend that has won big gaming at an online casino (or even some friends who do it professionally!) but between all of the great bonuses and giveaways offered, have you ever wondered how online casinos make their money?

They make you play with chips instead of real money. When you double down on the blackjack table.

'Casinos typically put their wheel of fortune tables right at the entrance to the casino, hoping that suckers will plop some money down as soon as they walk in. You should just keep on walking.' 'Casinos are pretty predictable, they all have the same colours for the same chips. $1 chips are white or blue, $5 chips are red, $25 are green, $100.
Even in casinos, many players like the social aspect of sitting at a poker or craps table where they can meet other people, and the potential to win money is only one of the perks.
Once they get you into the casino their goal is to entice you to play longer. We know the casinos make their money because they have a house edge on all the games so it’s only logical that the more you play the more money the casino will make in the long run. One way the casinos get you to play longer is by offering entertaining games.

In recent years, online casinos have been absolutely killing it. The 2019 online casino market share was valued at around $57 billion with a projected growth rate of 11.5% annually. From those numbers, it will have more than doubled in the next 7 years.

Those are some huge gains in a short period of time so let’s dive in and see how online casinos are raking in the big bucks while giving some hefty payouts.

Free money and free spins

One of the most successful marketing tactics used by online casinos is enticing new players into the game with free cash. This “free cash” can come in many shapes and forms, such as no deposit bonuses, free spins, and free play for a limited time.

Petra Mueller from NoDepositFriend.com gives us the inside scoop, “Online casinos understand that sometimes all it takes to make a new long-term player is to give them a chance to try the games. This ‘free money’ method is a sure-fire way to give players an opportunity to try the games, risk-free.”

In order to get a new player bonus, however, gamers will generally need to enter their credit card information to open a new account. This ensures that once a player gets hooked on the games and wins a few prizes, they’ll use the card on file to continue playing.

Comps and addictive behavior

In a strategy that’s the polar opposite of devices like paywalls, this method of gaining players relies heavily on addictive behavior. It’s proven that people get an endorphin rush from gambling, whether they’re winning or losing.

This behavior actually produces similar effects in the brain as stimulants and drugs, forming new neural circuitry along the way. When a player sees the possibility of a huge jackpot and places a large bet, the thrill of the game increases as the wagers do.

Online casino game structure

Most people might expect the topic in this section to mention scams and how online casinos “rig” games in their favor. This, however, is simply not the case. Online casino games employ complex algorithms that make it impossible for the house or the players to tamper with the game.

This trust in gaming technology is actually one of the reasons that players are able to enjoy games in online casinos with confidence. Professional online gamblers trust the algorithms and can play without fear of being swindled.

House edge and commissions

This isn’t to say that the house doesn’t program their algorithms using perfect RNG (random number generation), however. The ‘house edge’ is a well-known phenomenon that helps to answer the question of how online casinos are able to make the big bucks.

House edge

While it’s true that the games cannot be manipulated by the management during or after a game, the way they are programmed does have a significant influence on who wins and loses. This hedge by the house is called the ‘house edge’ (but could also be called the ‘house hedge’).

Casinos Make Their Money On The Outside Youtube

House edge is a complex formula that predetermines a certain percentage of players will lose. The percentage is usually low (around 5%) and doesn’t seem like much, but when you account for how many people are playing online, it can add up to quite a large sum of money.

Online casinos earn the most revenue from games like roulette and slots with their pre-programmed statistical advantage. Neither party knows the outcome of any particular game, but even when they do have to pay out on jackpots, the house edge means that the house will have collected a portion of the player’s money on each previous game.

Commissions

Commissions generally only come into play in the game of poker. When players sit down at a poker table, everyone pays a fee to be a part of the game. This fee can either be a percentage of the bets made or a flat fee.

Online casinos collect the commissions, which is called the “rake”, at the start of each round and is basically their fee for dealing the game. It’s an important distinction to make because it means that the house is not a participant in the game, as is the case in blackjack.

Winning the jackpot

The house edge alone may seem like a sure thing when it comes to earning a profit running an online casino but as you can see, online casinos bring in a lot of money in a variety of ways. Some of these methods work seamlessly together to guarantee an income, regardless of odds. For this reason, players never have to worry about being scammed or cheated by an online casino. If you win, you’ll get paid.

Cheats. Scammers. Liars.

In the casino world, these are usually terms used by the casino to describe players who are trying to game the system to their advantage. In fact, there are many television and movie productions that you have probably watched with these scammers as the subject.

However, in the online casino world, these terms can also be used to define a rogue casino – an operator that, for some reason, thinks it is ok to scam players out of their deposits. These low-life owners hide behind the anonymity of the internet, using whatever means necessary to attract players to their casinos, only to find every way imaginable to keep the money without ever paying out a dime.

As a site dedicated to bringing you the most honest, up to date reviews of casino sites, we pride ourselves in tracking down the worst of the worst. These rogue casinos end up here – our Casino Blacklist.

Now, it is important to note that this is truly (at least for now) a handful of bad seeds which are giving the rest of the industry a bad name. Sadly, as many of these clowns’ real names cannot be located, we are limited to telling you what brands to stay away from, as well as telling you to continue to post on sites like this when you come across something out of the ordinary. The online casino world has done an excellent job policing itself over the years; the more we call out these scammers, the less likely another player will fall victim to their trap.

What Defines a Blacklisted Casino?

At LegitGamblingSites.com, our team of reviewers checks every casino thoroughly for signs of a rogue operator. Here are some of the red flags that we look for when we are reviewing any online casino.

Payment Issues

The most common complaint from online casino players is that a casino is taking forever to send them their withdrawal or they aren’t paying them at all. It usually all goes the same way; a casino says the withdrawal can take up to 30 days to process, then excuses start about why the payment is delayed. Following that, either a partial payment is paid, or the money never shows up. Online casino players are savvy; many are used to these tricks and use public forums to call out the operators. However, the rogue casinos don’t care and will continue to steal money right from their loyal players.

Licensing

Legitimate casinos tend to get licensed by a jurisdiction that gives players the security in knowing that the owners have been properly vetted and that their money is going to be safe. As with everything else in this industry, there are ways to get around this; some countries provide “licenses” that have far less stringent rules if any at all. In extreme cases, a rogue casino will slap a logo from one of these regulatory boards on their site without ever having gone through the application process.

Pirated Software

This one can be a little tricky to detect without a