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Saturday, December 1, 2018

The Stagnant Legal US Online Gambling Market Versus The Robust European Market

The growth of legalized online gambling in the US has long been debated, tried and in most cases not pursued  by state legislatures. A few states such as New Jersey, and Pennsylvania have enacted online gambling legislation.  Most US  states have no specific legislation banning online gambling  and allow gambling online despite the fact that there is no specific legislation that sanctions the activity.

This seems a bit odd given the fact that online gambling is a popular activity that could have tax benefits for US states that allow online gambling.  It is no surprise that alternatives to sanctioned online gambling are thriving.

Offshore Online Gambling - It is no secret that many casino sites are hosted offshore. Many of them are in the Caribbean, Central America , Africa and Asia. The revenue for these properties is in the billions of USD. Despite this astounding statistic little has been done by governments to stop the practice of online gambling at remote properties.  Most, but not all of these sites, are governed by the jurisdiction they are in. However, there are many sites that are not. Thus, the reason for caution when wagering on these properties. Also, many of these properties open and close quickly. So do your homework on the site you are wagering on to make sure that they have a reputation for proper  deposit, withdrawals and a qualified bank that supports the online gaming operation.


Virtual Currency Gambling -  The advent of virtual currencies such as bitcoins and Facebook credits, have fueled online gambling transactions.  These properties allow a player to deposit traditional currency into an account and to convert the traditional currency into a "virtual" currency. The notion is that a player is "wagering" with a currency that is not backed by a governments treasury.  Facebook credits are an example of a "virtual currency" that can be used to wager within the Facebook environment.

No Cash Out - Virtual currency based gambling sites are legal in the US because there is no "cash-out" or conversion from virtual currency into conventional currency.  After converting from cash to virtual currency the investment remains in a virtual currency state.

European Online Gambling - The European Online gambling market is a mature and sophisticated market with the majority of the gambling sites being hosted "off shore" on various regulated principalities such as Alderney, Isle of Man, and Gibraltar. These principalities are acknowledged by the various European countries as "legal" places to wager online.  Sweden has  legalized online gambling  and has allowed the sites to be hosted in Sweden.

With online activity of all kinds driving economies and business sectors it is odd that the the US, in particular, has be unable or unwilling to cultivate a legal online gambling regime. This could be the result of pressure from land based casino that could perceive online gambling as a threat to their land based properties. Unfortunately, this approach actually drives players to engage with offshore gambling sites that could pose a risk to players.

Kevin Flood, Inc.   Kevin has worked for and with US land based casino operators helping them evaluate social casino and iGaming platforms for the purpose of joint ventures and acquisitions in addition to launching online gambling operations in Europe.  Kevin frequently speaks at gaming conferences around the world providing him with a unique perspective on this very interesting business sector. Kevin can be reached at kflood6@gmail.com.  







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