Why Do Casinos Use Chips

Casino chips have been used gambling establishments for several decades - so why do casinos use chips instead of cash?

why do casinos use chips
Why Do Casinos Use Chips

Casino chips have been in circulation among gambling establishments for several decades. With paper money, credit cards, gift certificates, and even cryptocurrency being honored by various establishments, casinos still use chips to this day.

To understand why casinos prefer this type of currency within their gambling halls, we'll look at exactly why do casinos use chips.

Encourage People to Wager

Which one would you be more hesitant to lose? A $100 bill or a $100 chip? You are likely to spend the chip on any casino game while keeping the bill safe in your wallet.

There's just something about cash that makes people reluctant to let go of it, a problem the casino chips don't have.

Spending psychology is one of the reasons why casinos prefer chips over cash since most people disassociate their chips with actual money - something that has been studied by academics. When you own casino chips, your mind does not think of it as cash that you will spend on food, gas money, or other commodities.

For most gamblers, chips are just a token to be used on gambling floors. For gambling establishments, their goal is to get as much cash converted to chips as possible. Once that cash has been converted, people are far more likely to stay and gamble until they run out of chips whereas they would stop before they lost all their cash.

Convenience of Accounting

With money circulating the cages and gambling floor, chips make it easier for the accounting staff to keep track of the cash they have within the premises. Casino chips' shape and size make them easy to stack and store. By tracking the circulation of chips within the floor, casino management can accurately calculate the money coming in.

Makes the Games Run Faster and Smoother

A pile of casino chips with one facing forward

Imagine playing a round of blackjack with all seats occupied and the casino allows everyone to use paper money instead of chips. While there are patrons who already have their bets ready, others might be deciding how much they are going to wager. When the player counting their money is up next, they could still be going through their wallet and take around 10 to 15 minutes before ending their turn. 

Paper money has no business being on a casino table. It can take a significant amount of time just counting the amount. Bills are also hard to keep track of, which is a major negative for the croupier and security personnel.

Casino chips' size and shape make them easy to manage for both players and dealers. Croupiers and patrons can immediately recognize the amount of each chip without reading the value on the surface because of their color. Even the pit bosses and surveillance crew can easily track the bets made thanks to the color of each chip.

Prevention of Fraud

When a table is full of chips, what is stopping anyone from just grabbing all of them and running out of the casino? Those who are mad enough to do this brazen act will need to cash out the chips within the casino. Otherwise, all they have are value-less casino chips since they cannot be traded to cash immediately among any establishments apart from the one that issued them.

If the criminal then tries to cash in these stolen chips, RFID technology allows the casino to identify the stolen chips and refuse payment. Radio-frequency identification technology allows the casino to authenticate high valued casino chips. For low-valued ones, special serial numbers are etched on all casinos chips to further prevent counterfeiting.

Another benefit of a casino chip tracker is to allow management to track the movement of the establishment's currency around the gambling floor. Surveillance systems can use RFID tags to find players who are consistently winning at an unusual pace, allowing security to find potential cheaters. RFID casino chips also help discourage or catch collusion between staff and patrons as well as casino cheaters.


Keep Track of High Rollers

Casino chip trackers are not only useful for cracking down on criminals, but it is also handy for finding VIP patrons. VIPs are huge spenders on the gambling floor who are willing to part with a significant portion of their bankroll when given enough encouragement. Tracking down these VIPs allows management to incentivize their patronage with comps, enticing the players to wager more of their money.

Branding Purposes

Marketing departments want people from across the counter to think of their casino name and logo when the topic of gambling pops into their minds. When these people happen to visit Las Vegas, Macau, or Monte Carlo, they will likely visit the casino they know thanks to advertisements and promotional campaigns.  

From a marketing point of view, casino chips are powerful brand tools. Etching the casino's name and logo on the chips can solidify the brand onto their patrons, encouraging visitors to return or refer their friends to the establishment.

Casino chips have an incredible number of uses apart from just a representation of a players' money. Chips can provide security, marketing, money organization, and other useful function that can bolster an operator's business.

This article was published on December 3, 2021, and last updated on June 28, 2022.