A Pseudo-RNG, like the True-RNG, will have its strengths and shortcomings. Yet a comparison of these two random number generators will facilitate our understanding of why we have a compromise today in casino gaming where most online gambling sites and casino gaming machines settle for a Pseudo-RNG. Let's contrast these two RNG's and get a clearer picture of our current gaming situation.
Pseudo-RNG's will not perform in the manner we can exactly expect in case we are used to really random events like dice rolls, the spin of a roulette wheel, or drawing of lottery numbers. The "pseudo" in a Pseudo-RNG really explains a lot if you consider it when making a comparison with a True-RNG.
Pseudo-RNG's are sets of algorithms (i.e. logical instructions for by a computer program) that utilize mathematical formulas to produce a certain sequence of numbers that will appear random, or at least will have the effect of randomness. Other RNG's use pre-calculated tables instead of mathematical formulas, but either way table or formula, the objective is still the same.
A lot of research has been done (and is still ongoing) on RNG's insomuch that our modern algorithms used for Pseudo-RNG's produce number sequences that do exactly mimic truly random sequences. But that may be the outcome of today's research there is still room for improvement since the results of Pseudo-RNG's are really "pseudo".
Comparing the results of a Pseudo-RNG with that from a True-RNG will prove useful. If you list down the results of a Pseudo-RNG mimicking dice rolls the numbers will really appear as if they are random. But statistical analysis will prove that the numbers produced by a Pseudo-RNG is not really random but is rather predetermined. Thus its results can be measured and standardized, and, we can say, controlled.
True-RNG's behave differently since the results are truly random and unpredictable. If we try to get a computer to produce a really random sequence of numbers then the computer must base its numbers on a naturally occurring physical phenomenon, which may include the radioactive decay of isotopes, static in the airwaves, and the waves of the sea. True-RNG's will not really be cost-efficient if you compare it to Pseudo-RNG's. True-RNG's will be subject to wear and tear since all things natural will really be subject to entropy. A Pseudo-RNG will not be subject to such physical phenomena.
Another efficiency of a Pseudo-RNG is that you can reproduce the same sequence of numbers in another time by simply knowing the starting point of the sequence (thus it is also periodic and the sequence will repeat itself in due time). This better facilitates inspections done by casino control boards. But you can be sure that the sequence of numbers produced by a Pseudo-RNG, though periodic, the time to reproduce the same sequence will eventually take a really long time that unless you acquire the actual algorithms, the correct sequence will be very difficult (almost impossible) to crack.
Many online casinos have settled for Pseudo-RNG's for its cost-efficiency, periodicity, and efficiency. These are good reasons to choose this type of random number generator, though a True-RNG will also have its own benefits as well.