New Online Gaming Opportunities in the USA

New Online Gaming Opportunities in the USA

January 5, 2012.

USA Casinos got a pleasant surprise right before the New Year with an official announcement from the Department of Justice. This new legal decision has paved the way for intrastate online gaming, which is expected to be used shortly for online lotteries for the states of New York and Illinois. However, this also brings about implications that will drive the future of online gaming as a whole for the USA. Let's take a look at the announcement, what it means, and perhaps more importantly, what it doesn't.

The US Department of Justice's New Clarification

The hubbub about new gaming regulation in the United States is based on a new interpretation of the Wire Act of 1961. This piece of legislation made it illegal to conduct sports betting through any telecommunications line. It was passed with the intention of stopping phone bets, but when the Internet gaming industry began to take off in the late 90s, it was used to prevent bets through the Web as well. The Department of Justice has, until now, maintained that the Wire Act prohibited any forms of online gambling.

In response to inquiries written by leading US Senators Harry Reid and John Kyl, the Department of Justice has released the following statement to revise their previous stance on the Wire Act and the Internet: "After a thorough review, we concluded that... the Wire Act only to the transmission of bets or information assisting in the placing of bets or wagers relating to sporting events or contests."

New Opportunities for American Gamblers

With the Department of Justice effectively changing its mind about the scope of the Wire Act, opportunities for intrastate gaming are now available immediately. As mentioned earlier, both the states of New York and Illinois will likely be offering state lottery services through the Internet in the near future. Anyone who wishes to conduct online gaming business within a state now has the chance to do so.

What can be expected from this is still unclear. The one thing that is most likely, of course, is that other states will begin to offer lottery sales through the Internet. Entrepreneurs may also take the chance at creating online poker and casino services that are offered to residents of specific states. Speculation exists, for instance, that major Las Vegas-based gaming companies may offer online services to citizens of Nevada.

What Stays the Same

In spite of all these changes, the current world of online gaming for American players will remain largely the same for the near future. Since all online casinos currently serving American players are based outside of the US, processors facilitating transactions to them are still seen as in conflict with the UIGEA policy passed in 2006. Although players themselves do not face the risk of prosecution, casinos will have to continue finding new ways to allow players to fund and withdraw from their accounts.

What we can say, however, is that this appears to be America's first real step towards regulation. Although we are not sure how this will end up, we will be keeping an eye out for new developments and keeping you informed as we get more details.