Online Gambling In The United States

The subject of having legal and regulated online gambling in the United States has been a very sensitive subject for the past few years, but recent changes in the regulations can help shed some light on the situation. While the federal Department of Justice continues to hold its position that the Wire Act of 1961 refers to all forms of gambling and that they should be banned, some states, such as Nevada and New Jersey, have already taken matters into their own hands and introduced their own sets of regulations that apply within state limits.

Illegal online gambling

Despite the restrictions that are still imposed on the US market, there are millions of Americans that gamble on the internet. It is estimated that the annual market is worth somewhere between $4 and $6 billion; revenue that comes from around 1,700 offshore sites that cater to this market and do it in an illegal way. Although players get to enjoy their favorite games online, there is no customer protection offered by these sites due to a lack of regulations in the United States.

It is clear that the federal restrictions for online gambling have failed and that the demand is too big to be ignored. Prosperous markets from across the pond only encourage the regulators to push stronger and fight for legal online gambling in the United States. However, the fight most likely had its last round in late-2012, when the Reid-Kyl Bill didn’t make it through and was eventually scrapped with little chance of coming back. The bill would have allowed online poker in the US on a federal level which means that the same regulations would apply to all states and that all Americans would be able to benefit from them. The main arguments were that poker is a game of skill not a gambling option and that the growing market for it would easily overwhelm the federal restrictions, making illegal gaming even bigger.

State-by-state regulations

Once the “last hurrah” for federal online gambling failed, some states saw it as an opportunity to go on their own and issue their own regulations. This can have different implications on the overall online gaming market since it can be a starting point or another excuse to increase restrictions. 

The good thing is that US gamblers will be able to enjoy regulated online gambling if they are willing to travel to the state in question and this will also help the state from taxes and offer operators more customers. Tapping into brand new markets can always be profitable and, needless to say, that the demand for online gambling in the United States is very big.

On the other hand, the regulations differ quite a lot from one state to another and while this may seem secure within certain limits, it is important to remember that the federal Department of Justice still has the last word in all of this. Something similar to Black Friday, or maybe even worse, can always be just around the corner if the slightest suspicions come to life. With that being said, New Jersey, Nevada and Delaware are all in the race for offering the first real money, legal and regulated online gaming option in US since April 2011. Arguably, Nevada has the better start since it already issued out most of its licenses but the regulations only allow for online poker while New Jersey and Delaware offer a much wider range of casino games.

Overall, New Jersey has the biggest advantages right now; it has a very large population, the new law allows operators to include all the games that can now be found in a casino and the players don’t have to be residents of the state, they just need to be inside state limits. The interest from the biggest online poker room, PokerStars, is also a nice ace in the hole to have compared to Nevada that still has a “bad actors” clause for the next five years; this bans all operators that were in US after 2006 like Full Tilt Poker.

While it may be considered just a small patch for the problems in the US regarding online gambling, states that are on their way to having regulated offers can be just the start. Intrastate regulations have already been made and more states are expected to join the train once good results start showing.