Why Casinos Use Chips

Casino Chips on TrolleyWhen you head to a casino, you aren’t allowed to bet with cash. Or, to be more specific, any attempt to bet with cash will result in a croupier exchanging your physical money for some casino chips, encouraging you to bet with them instead.

The question is, why is it that casinos are more interested in taking chips from you than actual money? The answer, as you might well imagine, isn’t a simple one. There isn’t just one reason why casinos choose to ask players to play with chips instead of cash, though security is a good place to start.

Imagine a scenario, as has actually happened, where someone wearing a mask bursts into a casino and swipes everything that is lying on the baize of a casino table. If casinos accepted cash from players, the person would be able to escape with something that they could then spend and use wherever and whenever they fancied.

If they ran away with casino chips, however, they would only be able to exchange them for physical cash at the casino that they robbed. This, of course, would be very difficult to do, meaning that they would likely be found eventually.  High value chips also have their own microchips inside them for identification, so if stolen the casino knows exactly what chips have gone missing too.

The History Of Casino Chips

casino chips different colours and different sized piles

In order to get some sense of where casinos come from, we have to travel back to 17th century Italy. That was when gambling rooms, known as ‘il ridotto’, were first established. Games began to be offered there in 1638, soon becoming the only government-owned gambling location in the country and essentially the first casino.

Back then, people would simply use cash or other things that they could exchange for cash in order to facilitate their gambling. It was only when casinos began to appear more regularly in the rest of Europe and the United States of America that the casino chip became commonplace.

It will not be overly surprising to those that know a little about the Gold Rush in the US to learn that the early days of gambling saw people using the likes of gold dust, gold nuggets and gold coins when betting. Gambling and prospecting, of course, are two activities that come from the same place of wishful thinking.

Gold would come in all sorts of shapes and sizes, so knowing how much of it was worth what was all but impossible. As a result, a decision was taken to introduce chips that were easier to count, as well as being smaller and lighter.

These chips were usually made from wood or bone, with the use of paper and clay becoming more commonplace as time went by. The problem was, players learned that they could add their own home-made chips to their pile. It was only really once casinos began to expand across Nevada in the 1930s that the use of chips became both standard and also more regulated. N

ew designs allowed a casino to inlay their own designs into them, with technology eventually being used to ensure that casino chips were as safe as could be.


security watching cctvWhen it comes to answering the question about why casinos choose to use chips, there is nothing quite as important as security concerns. Each casino in Las Vegas, for example, has different chips from the other casinos in the city. They are recognisable thanks to their branding, colours and similar facts.

Not only that, but the best casinos have installed security features into the chips that they offer to players. This allows casinos to protect themselves from fraud, stopping those that would carry out such nefarious activities from doing so.

Whether it be UV markings, RFID technology or tracking capabilities, casino chips nowadays are significantly more sophisticated than the ones of old. They are also much easier to count, making the job of the croupier or pit manager much easier than in days of yore.

The fact that a casino is able to tell what chip is theirs means that the practice of buying low denomination chips and switching the label onto cheap chips bought from somewhere else, as an example, is virtually impossible to do now. Instead, a casino can simply scan the chips on the table and know whether they are theirs or not.

There is also the fact that using chips makes it much more difficult for people to rob a casino. If there was nothing but cash lying on a table, it would be relatively simple for a thief to swipe everything and disappear. They could even change the cash for a different currency if they wanted to.

If someone were to rob casino chips then the only place that they’d be able to use them would be in the casino that they’d stolen them from. This would both allow the venue to look out for someone trying to use large numbers of chips as well as giving them the chance of discontinuing the use of the chip if needs be.

They Are More Convenient For Everyone

casino chips and dice on carpet of cashPicture yourself sat at a blackjack table, doing well and feeling as though you’re on a roll. Suddenly, the guy next to you runs out of cash and needs to get out his wallet but can’t because his jeans are too tight. Eventually he does, but he doesn’t have the denomination that he wants to bet with, so begins asking the table for change.

Your streak is gone, your time at the table has become marred by someone needing more cash. Whilst the idea of a ‘hot streak’ is nonsense, betting is often as much about superstition as it is about anything else.

Using chips removes the possibility of that sort of thing happening. It is also much easier to carry chips around or change them for larger denominations than it is to walk around a casino with handfuls of cash. On top of that, croupiers can count how many chips you’re betting with really easily, rather than needing to count out each individual note.

This also makes it much easier for them to pay out than it would be with cash. All in all, casino chips offer convenience that some other form of payment wouldn’t allow for.

Another reason chips are used is due to counterfeit cash, which can be as common as 5% of all currency in some places.  Ultimately cash still needs to be checked before converting into chips but at least this only needs to be done once and not during each gaming round.

Even with slots these days it is getting rarer and rarer to find machines that take cash.  In larger casinos now you will be issued with a card that you can load up with cash and play using that.

The Psychology Of Casino Chips

money psychology brain made out of cashThose that have noticed the lack of clocks on the walls of casinos, or the fact that there are never any windows, won’t be overly surprised to learn that a lot of what happens in a casino is driven by psychology above all else.

Every decision that you make has been reached largely because of the psychology that casinos employ in order to try to separate you from your money. This is as important when it comes to what you’re betting with as whether you know how long you’ve been betting for, which is why chips are so important.

The simple fact is that casinos chips do not feel like real money to most people. As a result, punters are a lot more willing to place bigger bets with chips than they would do with their own physical cash. Similarly, bettors are more willing to fritter away their casino chips than they would ever be with cash.

Once a cash supply begins to look like it is running low, people are more likely to limit how much they spend. When it is casino chips, however, they will keep on betting because it doesn’t seem ‘real’, so it can’t be lost in the same way.

Cash has a psychological weight that far outweighs its physical one. Chips are, in essence, already paid for. For that reason, losing them isn’t as bad mentally as losing notes would be. This, of course, plays right into the hands of casinos that want to part you with as many of your chips as they can.

Even when you win, being paid in chips means that you’re more likely to keep betting than if you were given the physical cash that you could simply walk out of the casino with. What is easier, playing on or heading to the cashier to cash up?

Data Collection

cctv camera casino table illustrationCasino chips in the modern era are usually made bearing RFID tags. These tags can be scanned by the casino that they belong to in order to provide all sorts of information to them.

How do the casino chips move around the casino? What games to people tend to play more than any other? Has a dealer been making consistent mistakes or have fake chips been introduced to the casino’s chip collection? These are the sorts of questions that can be answered thanks to the technology contained within modern chips.

As the technology develops, casinos will even be able to use the RFID inside the chips to work out the level that each individual gambler has in terms of skill. On top of that, high rollers can be rewarded in line with their spending, whilst those that are looking to manipulate the system can be sniffed out.

The more information that casinos are able to gather on the players that play in their venues and the games that they enjoy, the more that they’ll be able to tailor the experience for everyone’s further enjoyment – and their ultimate profit.