Enable JavaScript in your browser settings to use the full functionality of our website.
Trustnplay

The Legal Landscape of Online Casino States in the USA

You can count them on two hands. Six states. Six states currently allow online casinos in the United States. That seems like such a small number, right?

Well, it is!  However, the good news is that laws and opinions are changing fast.

  • You might be asking what states have legalized online casinos?
  • What states are considering online casinos?
  • How do online casinos operate?

I have the answers for you in this article.

State-by-State Guide to Online Casinos

Navigating the online casino landscape in the USA is like going on an internet road trip across each individual state, each with its unique legal fabric. What’s legal in one state won’t necessarily be legal in another!

States Where Online Casino Gaming is Legal

The legal online casino (that’s real money casino games) landscape is constantly being redrawn as states recognize the economic and entertainment value these platforms offer.

Studies we have run at TrustnPlay.com have shown that gaming, both online and land-based casinos, can be a great tax boost for state economies.

Of course, though, some states have been quicker to draw than others.

States that allow online casino gaming include:

States Where Online Casino Gaming Is Not Legal

While some states have embraced the online casino revolution, others have maintained a more conservative stance on letting players wager their bets online.

Focus on Popular States: Texas and California

Texas

The Lone Star State stands firm in its traditional approach to gambling, with no current legislation allowing online casino games. In fact, gambling in Texas is outright banned.

In legal language, players break the law if they “play and bet for money or other thing of value at any game played with cards, dice, balls, or any other gambling device.” There have been talks about legalizing online gambling but no firm action yet.

Note: Best sweepstakes casinos, online casinos where no real money is exchanged, are part of a legal gray area. Many Texans who want to gamble online choose to play at a social casino instead.

California

Despite being a hub for innovation and technology in Silicon Valley, online casinos in California have yet to be legalized – seems outrageous considering the state houses the biggest cell phone manufacturer in the world, right?

The conversation around legalizing online poker in California has been ongoing, but as of now, no concrete steps have been taken to legalize online casinos or even card game parlors.

Navigating the Online Casino Map: A Visual Guide

Still confused as to where legal online gambling is allowed in the United States? Refer to this color-coded map of states where online gambling is legal and not legal.

⚠️ Please, dear readers, be patient. We will update this page with a Map really soon.

The Process of Acquiring an Online Casino License

Acquiring a business license to operate as an online casino in the United States is a complex process, involving stringent requirements and thorough procedures to ensure compliance with state and federal laws.

Operators have multiple levels of fiery hoops to jump through to start operations, including:

  1. Understanding State-Specific Regulations: Each state has its own regulatory body and set of rules governing online gambling. For instance, in New Jersey, it’s the Division of Gaming Enforcement (DGE), while in Pennsylvania, it’s the Gaming Control Board. Applicants must work with each state’s control board to gain licensure – and if an online casino wants to allow gamblers in multiple states, multiply that commitment out per state!
  2. Eligibility Assessment: Test factors include financial stability (after all, casinos must be able to pay out when players win!), criminal background checks for company owners, and a proven track record of integrity and ethical behavior. That means no criminal activity in the past.
  3. Application Submission: The application process requires submitting detailed information about the business, including ownership structure, financial statements, business plan, software details, and measures for ensuring responsible gaming.
  4. Software and Systems Audit: The gaming software and systems a casino uses undergoes a rigorous testing process to ensure fairness, randomness, and compliance with technical standards. This often involves third-party testing labs that will issue the company a certificate of completion. Consider it to be the ultimate high school exit exam!
  5. Compliance with Anti-Money Laundering Laws: The casino’s financial office must demonstrate adherence to anti-money laundering (AML) regulations and have systems in place for detecting and reporting suspicious activities.
  6. Licensing Fees and Taxes: The application process involves paying licensing fees and setting up tax accounts adjusted for the large volumes that will enter and exit the casino’s accounts.

Daniel Wallach, a well-known industry attorney we asked about the startup process, noted:

Staying on top of regulatory changes is critical for a new casino, or any casino, for that matter. What’s compliant today might not be tomorrow, given how quickly online gambling laws are evolving. The technology aspect is non-negotiable. Your systems have to be foolproof, fair, and in line with technical standards. Regular audits are a norm in the industry – and financial departments have to constantly toe the line with the latest reporting software to be ready at the drop of a hat.

Daniel Wallach

Timeline of Online Casino Legislation in the USA

1994 – The Free Trade & Processing Act: The Caribbean nation of Antigua and Barbuda passes the Free Trade & Processing Act, allowing online gambling operators to set up shop. Antigua and Barbuda is considered the first online casino hot zone – many of the earliest online casinos operated from there.

1996 – The First Online Casino: InterCasino, claimed by many players and experts to be the first true online casino, is launched, offering a range of classic casino games. Please keep in mind just how cutting edge this was for the time, when most online games looked like the interface of an Atari machine from the eighties!

1998 – Introduction of Online Poker: Planet Poker becomes one of the first online poker rooms, marking the beginning of online poker’s popularity, hosting some of the world’s first online poker tournaments at the same time.

2001 – First Mobile Gambling Features: The first mobile gambling features are introduced on cell phones, but largely didn’t take off due to technological limitations at the time.

2003 – The Rise of Poker: Chris Moneymaker takes home a win at the World Series of Poker, having qualified through an online tournament. This greatly boosts the popularity of online poker.

2006 – The Unlawful Internet Gambling Enforcement Act (UIGEA): The United States passes the UIGEA, prohibiting banks and payment processors from handling transactions related to online gambling. With processing payments now illegal and permanently halted, many online casino operators have abandoned the US market.

2011 – “Black Friday” of Online Poker: The U.S. Department of Justice indicts major online poker sites, leading to a crackdown on illegal online gambling operations in the country. By “taking the snake by the head” the federal government hopes to scare smaller operations into ceasing operations.

2012 – Nevada Issues First Online Poker License: Nevada becomes the first state to legalize and regulate online poker post-UIGEA, marking a significant shift in U.S. online gambling policy as other states see the effects of legalizing online gambling – mainly the potential cash value.

2013 – New Jersey Legalizes Online Gambling: New Jersey passes a comprehensive online gambling bill, becoming one of the first states to allow online casinos to offer full suites of games of all types.

2018 – The U.S. Supreme Court Overturns PASPA: The Professional and Amateur Sports Protection Act (PASPA) is overturned, allowing states to legalize online sports betting. This decision led to a rapid expansion of legal sports betting across the country.

The Future of Online Casinos in the USA

Imagine logging into your favorite online casino from your smartphone, the experience is so seamless and intuitive, it feels like a natural extension of the device in your hand. And if you feel like it, you can put on your VR headset and take a seat at a table where you can play all night long, speaking with other players from all around the United States.

It’s a growing reality! Mobile gaming, having grown exponentially, is now the cornerstone of the industry. Laws have evolved to not just accommodate, but to embrace mobile gaming. And games as silly as Farmville and Candy Crush are here to thank, softening the edges of gambling law by giving players the option of buying the prize package in. Game bonuses that once were legally challenged but paved the way for bigger, more creative casino operations.

So there you have it: envision a network of online casinos, no longer confined by state boundaries, operating under interstate compacts. These agreements forge a unity among states, standardizing regulations, and pooling resources. The result? Larger player pools, more diverse gaming options, and no more inky online gambling laws to navigate!

Staying Informed and Responsible Gambling

The future of online casino gaming is bright! It’s one that combines technology, responsibility, and collaboration to create an online casino industry that is not only more exciting and accessible but also safer and more ethical than ever before. And it’s coming soon.

Currently, we’re in the “waiting game” period for multiple states, a number that grows every year as lawmakers see the benefits of legalizing (again, and taxing!) online gambling activities.

As more states legalize online gambling and create customer protections we’re going to see a more integrated, more creative, more entertaining, and most importantly, safer, world of online gambling that’s both fun and accessible.

To be a part of this, stay on top of your local lawmakers about making online gambling legal and keep an ear to the ground on the news about gambling in your state! Together, we can do this!