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Gambling in America: A Guide to the Different States

Hannah Killburn

The US can be a complicated beast when it comes to what is and isn’t legal. This is because of the ways in which laws are governed. Due to the distinctions between state and federal jurisdiction, there can be a disparity between states over such regulations as legal drinking age, the sale of fireworks – even the death penalty.

While there are some who think that more should be decided centrally – because of the wide differences between each state in terms of population, lifestyle, livelihood and demographic – trying to find a one-size-fits-all rule is never going to be practical.

History of gambling in the US

One area where regulations vary wildly between states is gambling – both online and land-based. Every state has a slightly different opinion on casino games, sports betting, bingo, and even charitable lotteries. This might be for religious, economic or historic reasons, but it has led to some compromises from residents.

Fundamentally, all states are bound by the 1961 Wire Act, which outlaws the sending of money across states for the purposes of gambling. While it was originally passed to combat organised crime, today it’s being used to justify restrictions on online gambling. In 2006 another act was passed – the Unlawful Internet Gambling Enforcement Act – which sought to clamp down on online gambling even further.

Gambling in America: A Guide to the Different States

A huge turning point came in May 2018, when the Supreme Court overturned the PASPA ruling. This opened up the possibility of more states legalising sports betting, and what was previously an underground market began to see the light of day. The Supreme Court’s decision had an immediate impact on the gambling market, as operators began to prepare for complete legalisation. However, the Justice Department recently declared online gambling to be illegal – throwing the country back into uncertainty.

Let’s take a look at the gambling landscape in different parts of the US.

States where gambling is partly legal

Many states that have partly legalised casino gambling – like California, Michigan and North Dakota – have limited the experience to casinos on tribal lands only. This has provided an often much needed income for tribal communities, and given state residents access to games and sports betting, without the local government needing to get involved. Tribal casinos have become a bit of a gambling loophole for many other states, too.

Gambling in America: A Guide to the Different States
Morgan Stanley Research

States where gambling is outlawed

The strictest states are Hawaii and Utah, with all forms of gambling outlawed. These laws even govern social games – so if you’re planning on spending an evening playing poker with friends, you have to make sure that no one is profiting from you all being there. The state of Utah tends to turn a blind eye to casual betting – such as office pools around major sporting events – but if any of the residents want anything a little more hardcore, they have to be willing to travel. Gambling trips to out of state venues are common, with the neighbouring state of Nevada often playing host to those looking for a little excitement at the casino tables.

States where gambling is mostly legal

Nevada is the most liberal state in America when it comes to gambling. This is hardly surprising when you look at the state’s history – and its reliance on Las Vegas tourism. When gambling was legalised in 1931 it was to a great fanfare, and it took a much-loved pastime out of the shadows and into the light, where it could be enjoyed openly. In 1955 the Nevada Gaming Board was created to regulate the industry and break the ties with organised crime. While casino games, sports betting and live poker are all legal here, Nevada is one of the only state not to have a lottery.

New Jersey and Delaware are hot on Nevada’s heels in terms of their progressive attitude to gambling. Everything is legal, including online gambling – something else which is not permissible in Nevada. In fact, Delaware was the first US state to legalise online gambling, and has one of the most comprehensively regulated gambling economies.

Other countries where gambling is flourishing

In this way, Delaware’s gambling industry functions very much like that of the UK, one of the biggest worldwide gambling economies.

Any US lawmakers wanting to modernise regulations might look to the UK, which has a very clear legal structure governing an open market. All gambling operators must demonstrate they can verify their customers’ identities and sources of funds, and commit to maintaining high technical standards, before they’re granted a licence.

Gambling in America: A Guide to the Different States

Also, as the UK gambling industry is able to tax operators, it generates a significant amount of revenue for the treasury. This money is then reinvested into the country’s infrastructure, improving transport links, education and national healthcare.

Many US states – like Texas and Massachusetts, which have seen their economies suffer as gambling tourists take their cash out of state – are now looking into relaxing laws so that that money can go back into their treasuries instead.

With public interest in gambling growing, especially on the back of the proliferation of online casinos, there is now a real vested interest in regulation that will see profits benefiting the states. This could be through taxation and the issuing of licences, instead of just relying on state lotteries, as many of the more conservative states do.

While the UK is a similar size to Delaware, this isn’t the only similarity. Gambling is a very popular pastime in both locations, with residents indulging in everything from sports betting to online poker. However, slots are the most popular online casino games – appealing to all ages and demographics because of their simplicity. There are hundreds of different games online which means everyone is sure to find one that appeals to them without having to wait in a queue for a machine to become vacant. All the sights and sounds of the real casino experience have been translated online, so they’re a great gateway game for long-time casino goers who are looking to replicate the experience elsewhere.

Thanks to greater market competition and improvements in digital technology, today’s online slots are more better than ever – with immersive storylines and engaging graphics. Gamers looking to play the most cutting-edge titles should check out gambling expert John Grochowski’s best new slot games list, which includes games with themes ranging from magic to adventures.

Where does the US go from here?

With a projected global market size of over $70 billion, the future of the American gambling industry – and across the world – clearly lies online. Demand for access to online casinos and betting is growing and many states are seriously looking into the best way to provide this for their residents, often facing a backlash from casino owners who fear a reduction in their profits.

The government of New Jersey has found a way around this by stipulating that all online casinos wishing to operate in the state must be partnered with the existing Atlantic City casinos. For once, this issue is being debated at a federal level, with a case currently being heard in the Supreme Court surrounding the legality of online betting. Opponents are arguing that it contradicts that old anti-money laundering law, the 1961 Wire Act.

If the Supreme Court rules in favour of amending the law, the US could see the barriers to online gambling and sports betting lifted. While it would then be up to the states themselves to decide how to regulate the industry, it would potentially throw open the doors of the internet casinos to people in more conservative states, and give those states more revenue options in order to line their own coffers. The UK might be at the forefront of gambling developments, but the US still has some way to catch up to have a competitive global market.