Published on August 1, 2013 in Industry News

The United States is known for its gambling meccas of Las Vegas, Atlantic City and the many casinos on Native American reservations. But the U.S. is actually one of the few nations that lacks a thriving online gambling marketplace.

The U.S. has an array of state laws and federal legislation that make it extremely difficult for online casinos to operate. Despite this, the number of online gamblers based in the U.S. continues to rise thanks to some US friendly online casinos. In this article, we'll examine online gambling in the USA.

The Legal Obstacles to U.S. Online Gambling

The U.S. has extremely stringent regulations concerning online casinos, though it is permissible for Americans to bet online. In the USA, there are a few states that allow casinos with a physical in-state location to operate an online gambling website as well, but the red tape is incredible. In short, the U.S. does not make it easy for the development and growth of a U.S. online gambling market. This means there are very few online casinos based in the United States and a number of online casinos that are based elsewhere in the world do not serve Americans.

The U.S. Federal Wire Act prohibits sports betting. There's also the Unlawful Internet Gambling Enforcement Act of 2006, which prohibits banks from performing transactions with online casinos and gambling websites.

Of course, these regulations have not stopped individuals from discovering and exploiting loopholes that allow for online gambling in the U.S. Overall, this creative loophole exploitation has actually led to favorable change in a few states, which are now opening doors with new, more permissive gambling legislation.

Online Poker in the U.S.

Most of the most recent changes to gambling legislation involve online poker; this comes on the heel of the viral popularity of Texas hold 'em poker tournaments in the states. Nevada now allows online poker and even federal legislators have admitted that online poker is not covered by prohibitions in the U.S. Federal Wire Act.

Poker tournaments have also become very mainstream in American culture and even top-winning players like Phil Ivey and Chris Moneymaker admit they found their start in online poker websites.

Sports betting has also become more commonplace and widely accepted in the U.S., with the annual NFL Super Bowl taking the title as the nation's most bet-upon event. According to Nevada Gaming Control Board, $94 million worth of bets were placed upon the 2012 Super Bowl alone (and that only accounts for bets that were reported to that particular authority.)

The U.S. Masters Golf Tournament is yet another popular event for bookmakers, though American sports betting still doesn't hold a candle to the sports betting that occurs abroad on sports such as horse racing.

The U.S. Gambling Market

While U.S. legislators have erected significant amounts of red tape surrounding casino gambling, sports betting and online gambling, there's an interesting contradiction that's present: the U.S. government sees millions upon millions of dollars in profits from state-condoned gambling in the form of games such as Keno, scratch cards and lotteries.

It's a contradiction that has led many to question lawmakers' real motivation in erecting such stringent red tape surrounding online gambling in the U.S.A. Some have suggested that the high degree of prohibition – rather curious for a western nation – is due to a fear that the legalization of U.S. online casinos would be only minimally profitable for the government, difficult to regulate in practice and they could even detract from these money that flows into the lotteries and other government-condoned gambling outlets.

Yet American gamblers can still find online casinos that allow them to bet, so the prohibition has forced U.S. gambling enthusiasts to spend their money in a way that provides absolutely no benefit to the U.S. government.

America's brick and mortar casinos are found throughout Native American reservations and in gambling meccas such as Las Vegas, which saw nearly 40 million tourists and an incredible 16.9 billion dollars in 2012. Atlantic City sees about $5 billion per year, and other smaller destinations like Biloxi, Gulfport (both in Mississippi) and the river boats of the Mississippi River.

With the dramatic popularity of casinos and the movement toward legalizing online poker websites, many surmise that it may only be a matter of time before Americans see U.S.-based online casinos arising.