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US Online Sports Betting
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A new era of legal online sports betting in the United States began in May 2018. The U.S. Supreme Court ruled the Professional and Amateur Sports Protection Act of 1992 (PAPSA), which outlawed sports betting, was unconstitutional.
With PAPSA no longer in effect, states can now offer legal, regulated sports betting, with each state able to establish its own laws. The Supreme Court’s reversal of PAPSA set off an online sports betting boom in the U.S.
As of February 2021, legal online sports betting is available in thirteen states: Michigan, Nevada, New Jersey, New Hampshire, Pennsylvania, Colorado, Rhode Island, Iowa, Indiana, Tennessee, Oregon, Illinois, Washington D.C, and West Virginia. All of these states offer mobile sports betting from anywhere within state borders, on state-regulated platforms.
Several other states have passed legislation to legalize online sports betting, with the actual launch of those platforms yet to come.
The U.S. sports betting industry appears to be in the beginning stages of a boom period, and those states offering legal mobile betting are poised to be at the forefront.
New Jersey, for example, has seen 80 percent of its sports betting handle produced from online and mobile bettors since launching its mobile platforms in August 2018. New Jersey’s overall sports betting revenue is second only to Nevada, and the impact of mobile betting on those totals could be an indicator of things to come in other states.
The first two companies to launch mobile sports betting in New Jersey, DraftKings Sportsbook and FanDuel Sportsbook, lead the U.S. in mobile sports betting revenue. Both companies are aggressively expanding U.S. operations and are in a position to lead the rapidly growing market.
Legal sports betting (both retail and mobile) produced nearly $1.4 billion in revenue in the U.S. from June 2018 through March 2020, and those numbers should continue to rise.
US Online Casinos
Legal, real-money options for online casino games aren’t as far-reaching as mobile sports betting in the U.S. so far.
Legal and regulated real money online casino games are live in New Jersey, Delaware, and Pennsylvania. These online offerings include the most popular games normally seen on the floor of land-based casinos, such as slots, blackjack, roulette, craps, and casino poker games like Pai Gow Poker and Caribbean Stud.
Delaware was the first U.S. state to legalize online gambling, doing so in 2012. New Jersey and Nevada followed suit in 2013, with Pennsylvania becoming the fourth in 2017. Nevada’s legislature only allows for online poker, and not other casino games.
In the three states that do offer legal online casino games, all online and mobile platforms are tied to land-based properties in some fashion. In Delaware, the state’s three land-based casinos offer online gambling through a unified platform, operated by 888 Holdings.
New Jersey hosts more than 20 online casinos, all tied to retail properties in Atlantic City. Pennsylvania, the newest player in the online casino game, currently has four casinos offering real-money games, and more to come.
Online casino revenue hasn’t made the same impact as sports betting, but both New Jersey and Delaware saw an upswing in revenue growth for 2019.
US Online Poker
The same four states (Nevada, New Jersey, Delaware, and Pennsylvania) that allow for online gambling aside from sports betting also offer legal online poker.
WSOP.com is the biggest online poker site in the U.S. and is the only legal real money online poker network allowing for players from multiple states to play against each other. WSOP Nevada, WSOP New Jersey, 888 Poker NJ, and the 888 Poker network of sites in Delaware all have access to a shared online poker client, which allows for players within those states to play against a merged player pool.
While WSOP.com is the only option for online poker in Nevada, New Jersey has other options in addition to the WSOP/888 network. Those platforms include PokerStars NJ and a partypoker NJ network.
Pennsylvania is expected to see several of its approved online gambling operators roll out online poker clients within the next year. The first of these platforms, PokerStars PA, launched in November 2019. For both PokerStars and partypoker, their U.S. poker clients only allow access to players from within the states in which they’re based and are not linked to either company’s international poker sites.
The prospects of future shared liquidity/interstate poker networks is uncertain. In January 2019, the U.S. Department of Justice issued a reversal of opinion on its 2011 interpretation of the 1961 Wire Act. The 2011 ruling effectively legalized gambling transactions conducted across state lines, as long as those transactions weren’t related to sports wagering. The 2019 reversal of that ruling is now attempting to restore the original language of the act.
If enforced, all state-regulated online poker sites would only be able to offer access to players located within the borders of their respective states.
Online Sweepstakes Casinos, Sportsbook & Poker Sites for Cash Prizes
For players who don’t reside in states with legal, regulated gambling options, online sweepstakes sites offer casino games, sports, and poker to all U.S. states, apart from some restrictive regulations in Washington state.
The biggest names in sweepstakes are Chumba Casino and Luckyland Slots owned by VGW Malta Limited and Global Poker by VGW GP Limited.
All of the sites use the same model, which allows players to purchase “Gold Coins” for use in play-money games. Gold Coin purchases also come with a corresponding amount of “Sweeps Coins,” which can be used to play in sweepstakes games.
These sweepstakes games include the full gamut of casino games at Chumba Casino, and on Global Poker players have access to a variety of stakes of poker cash games and tournaments. The Sweeps Coins used in these games are redeemable for cash prizes.
With the sweepstakes model in place, the games on Chumba Casino and Global Poker amount to mini-sweepstakes games. Sweeps Coins can’t be purchased directly, but come as a gift whenever Gold Coins are purchased.
Both Chumba and Global are popular options for casino gaming and poker throughout the U.S. Other platforms using the Sweepstakes model include Luckyland Slots, B-Spot, and FendOff Sports.
Daily Fantasy Sports
The legality of Daily Fantasy Sports in some parts of the U.S. is unclear. DFS are regulated and explicitly legal in many states, some of which include New York, Pennsylvania, New Jersey, Ohio, Colorado, and Massachusetts, among others.
The two biggest players in DFS, FanDuel, and DraftKings, operate in those states where DFS has been legalized, along with several others. FanDuel and DraftKings operate in about 80 percent of U.S. states, even with some of those states having an unclear position about the legality of DFS.
DFS are illegal to play in Arizona, Washington, and Montana. Most DFS platforms also steer clear of operating in the states of Alabama, Idaho, Hawaii, and Nevada, due to attorney general interpretations of law in those states.
Legislation surrounding DFS in the U.S. is ever-evolving. While sports betting revenues have surged in the states in the past two years, DFS revenue growth has leveled off a bit since the mid-2010s. The DFS market is still steadily growing, however, with U.S. DFS revenue accounting for nearly 60 percent of the global market.
DraftKings and FanDuel own 90 percent of the U.S. DFS market, while outlets like Yahoo Daily Fantasy and FantasyDraft are smaller alternatives.
Online Horse Race Betting
Online/mobile betting on horse racing has been around in the U.S. for far longer than any other form of online gambling. In the form of off-track betting (OTB) venues, horse race bettors have enjoyed the luxury of placing bets away from the actual site of a race since the 1970s.
The Unlawful Internet Gambling Enforcement Act (UIGEA) contains a provision that allows states to set their own laws as it relates to online horse race wagering.
The UIGEA, passed in 2006, was designed to outlaw payment processing from illegal internet gambling activities, which includes any kind of gambling-related transactions across state lines. It excludes interstate horse race wagering, which was established as legal under the Interstate Horseracing Act of 1978.
With that UIEGA exemption in place, 30 states currently offer legal online horse race betting. While OTB venues are still alive and well, online/mobile apps for horse race betting have grown in popularity.
Online horse race betting platforms like TVG, BetAmerica, TwinSpires, DRF Bets, and NYRA Bets are just a few of the options out there. These five platforms are the biggest names in the industry and allow for betting on events from hundreds of tracks across the country.
Horse race betting has a loyal following in the U.S., with the advent of mobile wagering options making it easier than ever to place bets and follow the sport on streaming services.
Online Lottery
State lotteries have been around for decades, but regulated online lotteries in the US is a relatively new concept, only offered in a handful of states.
The U.S. Department of Justice in 2011 released an opinion on the Federal Wire Act, which stated that interstate gambling transactions were only illegal if they were related to sports betting. This opinion opened the door for individual states to start offering online entries into national lotteries like Powerball and Mega Millions.
As of early 2021, seven states offer online lottery, which includes Michigan, Illinois, Kentucky, Pennsylvania, New Hampshire, New Jersey, and Georgia.
An eighth state, Minnesota, launched online lottery games without legislative approval in 2014. A 2015 vote from state lawmakers rendered the games illegal, and they’re no longer available as a result.
Regulations for the seven states that still offer online lotteries vary from state to state. New Hampshire, Michigan, Georgia, Kentucky, New Jersey, and Illinois all offer online ticket sales to Powerball and Mega Millions, in addition to each state’s own instant-win and lottery drawing games.
Pennsylvania participates in both the Powerball and Mega Millions national lotteries but currently doesn’t offer online options to purchase tickets. Pennsylvania’s online lottery offerings include instant-win games, Keno, and virtual sports.
The popularity of online lottery platforms varies across the states. Both online and in-person lottery sales have surged in Michigan and Georgia over the past decade, and the future of online lotteries looks bright for at least those two states.
At least three other states (Hawaii, Massachusetts, Connecticut) have introduced legislation to potentially allow online lottery sales in the future.
State Spotlights
Colorado Sports Betting
The Centennial State ushered in a new era of legalized sports betting in November 2019, as Colorado voters passed Proposition DD. The legislation allows for both retail and online sports betting in the state.
The state is home to more than 40 land-based casinos, and those casinos can now add retail sportsbooks, as well as online sports betting platforms, to their gaming line-ups
Colorado sports betting launched on May 1. Four sportsbooks launched including Draftkings Sportsbook, FanDuel Sportsbook, BetRivers, and BetMGM. Colorado’s online gambling offerings include sports betting, daily fantasy sports, and horse racing.
The industry’s biggest names are competing in Colorado. DraftKings Sportsbook and FanDuel Sportsbook, the two companies leading the U.S. mobile sports betting market, are both operating their brands in Colorado.
Other potential big players in the market include BetFred USA, which sees the successful UK-based BetFred brand extending its business plan into the U.S. BetAmerica (owned by Churchill Downs), PointsBet, FOX Bet (owned by The Stars Group), theScore, and Wynn Resorts will also launch platforms in Colorado.
That list includes just some of the companies planning on offering mobile sports betting in Colorado, and bettors will enjoy several options when the state’s newly minted sports betting industry goes full scale.
All online operators must be partnered with land-based casinos in the state, and as such the introduction of online/mobile sports betting is expected to be a major boost to Colorado’s gaming industry.
Colorado does not have legal, state-regulated online poker, lottery, or casino games.
Indiana Sports betting
Sports betting, both in land-based casinos and online, became legal in Indiana with the passage of House Bill 1015 last year.
Indiana Gov. Eric Holcomb signed the bill on May 8, 2019, and Holcomb himself placed some of the first bets in the history of Indiana sports betting. He did so on Sept. 1, 2019, the day the bill officially went into effect. With that, Indiana became the seventh U.S. state to legalize online sports betting.
The passage of HB 1015 allowed the state’s casinos to begin offering retail sportsbooks, as well as online/mobile sports betting apps in partnership with the land-based casinos. Land-based casinos started rolling out retail sportsbooks on the Sept. 1 date, with the first mobile betting apps launching a month later.
So far, five different mobile betting apps are up and running in Indiana. The companies offering those platforms are DraftKings Sportsbook, FanDuel Sportsbook, BetMGM, BetRivers and PointsBet.
The new market as a whole is off to a good start in Indiana, as sports betting (both retail and online) brought in more than $65 million in revenue in the first sixth months following launch. Indiana’s proximity to major cities like Chicago, Cincinnati, and Louisville gives residents of those cities a convenient option to drive into the state and place mobile bets from their phones.
So far, sports betting is the only form of state-regulated legal online gambling available in the state. Any other form of online gambling is not only outlawed in Indiana but criminalized.
Sweepstakes gambling sites like Global Poker and Chumba Casino are technically available to Indiana residents. But with strict laws and potential punishments in place, any online gambling conducted outside of the state’s regulated sports betting apps should be done with caution.
Michigan Online Gambling
The journey to legalized online gambling in Michigan has been filled with ups and downs. That journey finally hit pay dirt on Dec. 20, 2019, when Michigan Gov. Gretchen Whitmer signed House Bill 4311, aka the Lawful Internet Gaming Act, into law.
That date marked the second time an online gambling bill hit the Michigan governor’s desk. In December 2018, state legislators voted to legalize online gambling, but then-Governor Rick Snyder vetoed the bill just days before his gubernatorial term expired.
This time around, the Lawful Internet Gaming Act made it through that final stage. The new bill opens up an exciting new world of possibilities for online gambling in the state, which has a population of 10 million.
HB 4311 legalizes online sports betting, casino games, and poker.
The next steps in the process involve applications for online gaming licenses from the state’s 23 tribal and three commercial casinos, along with potential partners to operate online gaming platforms. The Michigan Gaming Control Board (MGCB) has a long task ahead to put all the pieces in place for a rollout of online gambling.
Sports betting was also legalized in Michigan last December, and land-based sportsbooks are already open for business. Online sportsbooks would presumably be next to get off the ground, although no official date has been set for the launch of mobile sports betting apps.
FanDuel Sportsbook, PointsBet, FOX Bet, and William Hill are among the companies expected to partner with various Michigan casinos for mobile sports betting.
Online casino games and poker for Michigan, while legalized, appear to be further down the road.
New Jersey Online Gambling
The Garden State is the undisputed leader in legal online gambling in the U.S. New Jersey’s history is synonymous with gambling, with Atlantic City operating for decades as the only major alternative to Las Vegas for land-based casino gambling in the U.S.
New Jersey is at the front of the curve when it comes to online gambling. Legislation to legalize online gambling passed in 2013, paving the way for a 2021 market that gives New Jersey the largest number of online gambling options of any state, by far.
Online casino games, poker, sports betting, and daily fantasy sports are all legal in New Jersey. Online casinos are operated in partnership with Atlantic City casinos, with no less than 22 different online casinos available to players within state borders. These casinos offer the largest spread of traditional table games, slots, and live dealer games to be found online.
New Jersey is one of four states to currently offer state-regulated online poker, with the WSOP NJ/888 NJ network giving New Jersey players access to a combined player pool from those state sites, as well as WSOP Nevada and the 888 Poker network of sites in Delaware. This merged network is the only one of its kind, offering players from different states to compete against each other.
PokerStars NJ and the partypoker NJ network bring even more online poker options to New Jersey.
New Jersey introduced online sports betting in August 2018, with DraftKings SportsBook launching the first of many mobile sports betting platforms to come. As of early 2021, New Jersey bettors have access to more than a dozen online sports betting apps.
New Jersey is second only to Nevada in overall annual sports betting revenue, with about 80 percent of total handle coming from online betting.
New York
A complicated battle continues between N.Y. Gov. Andrew Cuomo and state lawmakers wanting to legalize online gambling in New York. For now, online gambling of any kind is illegal in the state.
State Sen. Joseph Addabbo introduced online poker bill S 18 for consideration by state lawmakers in 2020. 2020 marked the seventh consecutive year that an online poker bill of some kind has been up for consideration in New York, but it was a no-go for poker or any other form of online gambling.
Senator Addabbo, who chairs the state’s Gaming, Racing, and Wagering Committee, and N.Y. State Assemblyman Gary Pretlow are the legislators at the front of the effort to legalize online gaming. Attempts to introduce legal online poker to the state have now been going on for nearly a decade.
Lawmakers like Addabbo and Pretlow are also pushing for legalized online sports betting in New York, as neighboring states like Pennsylvania and New Jersey reap the benefits of their own online sports betting markets.
Gov. Cuomo is opposed to legalizing online gambling, partially on the grounds that the New York state constitution would need to be amended to pave the way for legalization. Addabbo and other pro-gaming lawmakers contend that no amendment is needed.
A 2013 constitutional amendment allowed for the state’s commercial casinos to offer sports betting in the case of a reversal of the federal ban. That reversal happened when PAPSA was overturned in 2018, ushering in a new era of legalized sports betting in the U.S.
Addabbo and company contend that the language of the 2013 amendment already allows for mobile sports wagering, but the pushback from Gov. Cuomo continues. New York State’s annual budget was finalized on April 1, 2020, with nothing related to online gambling making it into the budget.
The push for legal online sports betting and poker is very much alive, however. For now, the only online gambling options available in New York are sweepstakes sites like Chumba Casino and Global Poker.
Pennsylvania Online Gambling
Pennsylvania offers the full gamut of mobile gambling options. The passage of House Bill 271 in 2017 authorized an expansion of Pennsylvania’s gambling industry to include sports betting (both retail and online), online casino games and online poker.
The addition of a robust online market has bolstered the state’s gambling economy, and Pennsylvania is second only behind Nevada in overall casino revenue in the U.S. The 2017 passage of HB 271 came with the provision that the launch of legal sports betting could only begin if the federal ban was lifted, which happened when PAPSA was overturned in 2018.
Land-based sportsbooks began operating in late 2018, with the first of the state’s mobile sports wagering platforms appearing in May 2019.
Pennsylvania players have access to multiple apps offering mobile sports betting, with market leaders such as DraftKings Sportsbook, FanDuel SportsBook, and Caesars Entertainment among the companies that have partnered with the state’s land-based casinos. The addition of these mobile wagering platforms has made a significant impact on Pennsylvania’s gaming revenues.
Online casino games are also available in the Keystone State, and like mobile sports betting, numerous options abound as many of the state’s 12 land-based casinos offer virtual versions of slots and table games.
A similarly expansive selection of online poker options will eventually be available in Pennsylvania as well, but for now, only PokerStars PA is up and running.
With the execution and expansion of the online gambling industry as a top priority, Pennsylvania looks poised to be at the forefront of the industry in the U.S. for some time to come.
Tennessee Sports Betting
Online sports betting became legal in Tennessee with the passage of House Bill 1 in May 2019. The Volunteer State, with no land-based casinos, is taking a unique path in the execution of its plans.
Unlike other states, which require online sports betting platforms to be partnered with its land-based casino properties, Tennessee is the first state to pass an online-only law pertaining to mobile sports wagering.
Potential operators will pay $750,000 annually to be licensed in Tennessee, with the state taking a 20 percent gross gaming revenue tax. These factors could present significant challenges for the future of online sports betting in the state.
The biggest names in the industry could have an eye on Tennessee nonetheless, as the U.S. market continues to expand. Companies like DraftKings, FanDuel, FOX Bet and William Hill are aggressively expanding their respective U.S. operations, and are heavily involved in all states that have legalized online wagering so far.
House Bill 1 does not have a provision to allow any kind of land-based, retail sports betting. The state’s sports betting offerings will be exclusively online, and the Tennessee Lottery will oversee the industry.
There is currently no set date for the launch of mobile sports betting in Tennessee.
California Online Gambling
Poker and other forms of gambling are popular in California, but as of yet no form of legal, state-regulated online gambling exists.
The most populous U.S. state with nearly 40 million people, the introduction of online gaming would no doubt make California one of the leading markets in the industry. However, as of now, it appears the Golden State faces a long road toward the implementation of online gambling.
Online sports betting, by far the most lucrative mobile gaming market, appears to be a long way away for California. The state has yet to legalize sports betting of any kind, leaving the 63 tribal-owned casinos in California without any sports betting offerings.
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These casinos are operated by more than 60 different Native American tribes, and any kind of online gaming legislation would involve cooperation among these tribes. This dynamic, along with the size of California and the complexity of state laws, makes potential online gaming legislation a challenging issue.
California is home to one of the most vibrant live poker economies in the U.S., with more than 80 card rooms in business throughout the state. Legalized online poker, should it ever manifest, would no doubt be welcomed by California’s poker players.
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Progress in the area of sports betting could be coming soon, however, as 18 of California’s gaming tribes filed a referendum to put sports betting on the 2020 state ballot. The initiative was shelved until 2022 due to coronavirus-related delays, but if land-based sports betting were to become legal, mobile wagering might not be far behind.
For now, California residents do have online casino and poker options with sweepstakes sites like Chumba Casino and Global Poker.
Iowa
Gov. Kim Reynolds signed bill House Bill 617 into law in May 2019, legalizing both land-based and mobile sport betting in Iowa.
Iowa’s new sports betting industry rapidly took shape after that, with the first of the state’s land-based sportsbooks open for business just three months after legalization.
William Hill, one of the biggest brands in sports wagering worldwide, was not surprisingly the first to launch an online sports betting platform in Iowa. William Hill, PointsBet, and DraftKings SportsBook are the three biggest names currently offering online sports betting in Iowa.
These mobile apps are operated in partnerships with various land-based casinos in the state, and overall Iowa’s casinos are fully embracing the opportunity to offer sports betting, both retail and online.
No other form of online gambling is permitted in the state, and there are no immediate plans to introduce legislation that would make online casino games or online poker a possibility.
As such, the best option for these forms of online gaming is sweepstakes sites like Chumba Casino and Global Poker.
Illinois Sports Betting
Adding to a long history of casino gaming and horse racing, along with a rich tradition of sports, Illinois legalized sports betting in summer 2019. SB 690 was signed into law by Gov. J.B. Pritzker on June 28, 2019, setting the scene for both retail and online sports wagering in the state.
The Illinois sports betting bill is unique in the number of different ways online wagering will potentially be available to bettors. Land-based sportsbooks, the first of which already began taking bets in Illinois in March 2020, can offer online sports betting.
Online-only operators can also apply for one of three standalone online licenses, but if not partnered with a land-based casino must wait 18 months to enter the market. With sports betting having gone live in Illinois in March 2020, that 18-month window sets the start date for online-only operators at September 2021.
Sports venues (potentially Wrigley Field, Soldier Field, etc.) can also apply for a sports betting license, which would allow for both retail sports wagering, as well as mobile betting. Sports venues must have a capacity of 17,000 or greater to apply for one of seven stadium licenses, and those licenses would allow for mobile betting within a five-block radius of the venue.
The Illinois Lottery will also oversee sports betting kiosks, which will allow limited options like “parlay wagers and fixed-odds parlay wagers” at retail lottery locations throughout the state. Up to 5,000 of these kiosks are allowed by law to begin operation by June 2021.
One provision of the Illinois Gambling Act restricts wagering on any of the state’s college sports teams.
Online poker and casino games are not legal in Illinois, and players looking for those options are better off playing on sweepstakes sites like Global Poker and Chumba Casino.
Texas Online Gambling
Gambling laws in Texas are highly restrictive, and it appears likely to stay that way for the foreseeable future.
No form of online gambling is legal in the Lone Star state. The only legal gambling available within Texas borders are at the state’s two land-based casinos and eight horse and greyhound racing venues.
Sports betting of any kind is illegal in Texas, although in recent years pro-gaming legislators have attempted to introduce various sports betting bills.
The latest of these efforts is a pair of bills filed by State Rep. Eddie Lucio in 2019. HJR61 would amend the Texas Constitution to allow sports betting, and HB1275 would create a sports betting oversight commission in the state.
Another bill filed in 2019 by State Rep. Roland Gutierrez would allow for up to 12 more land-based casinos to operate in the state. While these bills indicate that there are certainly lawmakers in the state with pro-gaming interests, there’s no indication that any of this proposed legislation will actually pass any time soon.
Live poker is on the rise in Texas, with private poker clubs springing up throughout the state. These card rooms are not explicitly legal, however, and any kind of online poker industry appears to not be in the cards for now.
West Virginia Sports Betting
West Virginia is on the list of states offering a full slate of online sports betting, casino games, and poker options, doing so with the passage of the West Virginia Lottery Interactive Wagering Act in March 2019.
Much like other states in the evolving U.S. online gambling industry, mobile sports wagering is at the forefront of West Virginia’s gaming offerings.
The first of the state’s online sports betting platforms launched in late 2018, in the form of the BetLucky Sportsbook. That mobile app was short-lived, however, ceasing operations after just a few months amidst a dispute with technology providers.
Fast forward to 2021, however, and the state’s mobile betting market is alive and well.
FanDuel Sportsbook launched in August 2019, with DraftKings Sportsbook hitting the market shortly thereafter. A third online platform, BetMGM, opened for business in January 2020. The future of the industry in West Virginia could see online sports betting expand even more, as all five of the state’s land-based casinos are eligible to operate three different mobile betting skins.
In July 2020, the first online casino app launched in West Virginia. DraftKings partnered with Hollywood Casino at Charles Town Races to launch its mobile casino product. More online casinos are expected to follow suit. Online poker will take a bit more time as rules, regulations, and licensing are in the works.
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