Gaming Law 2025 Comparisons

The US gaming industry operates under a complex legal and regulatory system that involves both federal and state laws. The industry is primarily regulated at the state level, with federal laws playing a supporting role that reinforces and complements state regulations.

The US allows a wide range of gambling activities, including traditional land-based casinos featuring table games and electronic gaming devices, as well as online gambling, sports betting, fantasy sports, and other interactive formats. Each state decides which of these activities are permitted within its borders and establishes its own licensing and compliance systems.

The online gambling market in the US has evolved rapidly over the past few years, particularly following the Supreme Court’s 2018 decision in Murphy v National Collegiate Athletic Association, which permitted individual states to legalise and regulate sports wagering. Since then, a growing number of states have passed laws allowing sports betting, including mobile and online wagering, and the market has expanded quickly across the country. Thirty-eight states have legalised sports betting, but the level of access varies by state. Some states have more restrictions; for example, in New Mexico, North Carolina, and North Dakota, retail sports betting is limited to tribal casinos.

In contrast, online casino gaming (iGaming) remains far more limited. Currently, only seven states – Connecticut, Delaware, Michigan, New Jersey, Pennsylvania, Rhode Island, and West Virginia – have legalised online casino gaming.

While online casino gaming is still not legalised in most states, a wide range of social and alternative gaming models have developed across the US. These include the following.

• Free-to-play games that incorporate features such as “loot boxes where players can use real-money to purchase randomised virtual items that cannot be redeemed for real-world currency.
• Skill-based games, including fantasy sports competitions, which rely primarily on player skill rather than chance.
• Online sweepstakes casinos, which simulate casino-style play using two virtual currencies – typically “gold coins” and “sweepstakes coins”. Players can purchase gold coins to play non-cash games for entertainment purposes, while sweepstakes coins are provided as “free” promotional gifts in connection with such purchases. Unlike gold coins, sweepstakes coins can be used to enter games that offer cash prizes or other redeemable rewards, allowing operators to claim that the model does not constitute traditional gambling because players are not directly wagering real money.

For free-to-play games, regulators have increasingly focused on child protection and the use of “loot box” mechanics. In early 2025, the Federal Trade Commission (FTC) took enforcement action against Cognosphere LLC (HoYoverse), the developer of Genshin Impact, over concerns that its loot-box system misled players about real-money costs and targeted minors. The FTC settled the case with HoYoverse for a USD20 million fine. As part of the settlement, the FTC required the company to make improvements to its loot box system, including clear disclosure of item odds, transparent virtual currency exchange rates, and simplified purchase mechanics. The order also requires parental consent for players under the age of 16 to make in-game purchases.

Skill-based games have also drawn increasing attention from consumers. AviaGames (Pandolfi, et al v AviaGames Inc) and Papaya Games (Kelly Starkebaum v Papaya Gaming Ltd.) are currently facing ongoing consumer class-action lawsuits in the US, alleging that their apps used automated bots instead of real human players, potentially manipulating game outcomes. The lawsuits claim that such practices misled users about the competitive nature of the games and have raised broader questions about fairness and transparency in skill-based gaming.

For online sweepstakes casinos, several states have recently moved to ban this model through new legislation. California, Montana, Connecticut, and New Jersey have officially prohibited the operation of dual-currency sweepstakes-style gaming platforms that mimic real-money casino play, by amending their gambling laws. In addition, a number of other states – including Pennsylvania, New York, Michigan, Maryland, and many others – have taken enforcement actions against sweepstakes casino operators by issuing cease-and-desist letters or similar regulatory warnings.

At the federal level, the primary federal statute addressing online gambling is the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA), which establishes that the legality of internet gambling depends on whether the activity violates state law. “Unlawful internet gambling” means a “bet or wager [that] is unlawful under any applicable federal or state law in the state or tribal lands in which the bet or wager is initiated, received, or otherwise made” (31 US Code (USC), Section 5362(10)(A)). Therefore, the legalisation and regulation of online gambling occur primarily at the state level, where each state has the authority to determine:

• what types of gambling are permitted;
• how and where gambling activities may be conducted; and
• who is eligible to participate, including age and location restrictions.

As described, online gambling (other than sports betting) in the US is limited, and there are only seven states offering regulated online gambling (see 1.1 Current Outlook and Recent Changes). Some states adopt additional restrictions on online games. For example, in Delaware, only the state Lottery Commission is authorised to conduct online gambling. In other states, such as New Jersey, Nevada, and Pennsylvania, licences are generally limited to existing brick-and-mortar casino operators that have obtained permission to offer wagers online. The remaining states do not allow online gambling, but some states offer certain forms of online lottery (comprising direct online computer sales and/or mobile device sales).

Sports betting has been far more widely adopted, including mobile and online sports betting. Currently there are 32 states (including Washington, DC) permitting mobile or online sports betting.

Fantasy sports occupy a unique position under US gaming law, and states take different approaches to determining whether they constitute a form of gambling. Many states, such as New York, Pennsylvania, and New Jersey, classify daily fantasy sports as games of skill rather than games of chance, and therefore permit them under state law. This interpretation is supported in part by the UIGEA, which includes an exemption for fantasy sports that meet certain criteria, such as outcomes reflecting participants’ skill and knowledge rather than the results of a single sporting event. However, some states, such as Nevada, Washington, and Montana, treat fantasy sports as a form of gambling and require operators to obtain a licence or prohibit the activity altogether. Other states may not have special laws that prohibit fantasy sports, but the attorneys general have opined unfavourably on the legality of daily fantasy sports in their states, such as Alabama, Illinois, and Texas.

Social gaming generally refers to free-to-play games that simulate casino-style gameplay, where players use virtual currencies such as coins or tokens that cannot legally be redeemed for real-world money. Most US courts have ruled that such games do not constitute illegal gambling, as long as the in-game items or credits lack cash-out or real-world monetary value (for example, Taylor v Apple, Inc., No 20-cv-03906-RS (N.D. Cal. 2022), and Mason v Machine Zone, Inc, No 15-2469 (4th Circuit 2017)). Even when secondary markets exist where players informally trade virtual items for money, some courts have generally found that if such transactions violate the game’s terms of service, trading via secondary markets does not affect the legal classification of the game itself (for example, Coffee v Google LLC., No 5:20-cv-03901-BLF (N.D. Cal. 2020)). However, Washington State has taken a different approach. In Kater v Churchill Downs Inc., 886 F.3d 784, 788 No 2 (9th Circuit 2018) and Larsen v PTT, LLC, 3:18-cv-05275-TMC (W.D. Washington, 11 June 2024), the courts held that social casino games could qualify as illegal gambling because the virtual coins used to play were considered a “privilege of play”, which constitutes a “thing of value” under Washington laws.

Skill-based games are structured so that the outcome is determined primarily by the player’s skill, knowledge, or strategy, rather than by chance. While skill-based games are generally permissible, they are still subject to state-specific tests to assess whether the chance element exists (see further discussion in 3.2 Definition of Gambling).

Although online sweepstakes casinos remain in a legal grey area in most states, they are explicitly illegal in many others (see detailed discussion in 1.1 Current Outlook and Recent Changes).

In the US, states act as the primary regulators of land-based gambling laws. The federal government mainly plays a supporting and complementary role, focusing primarily on prosecuting interstate gambling activities that violate state laws.

Land-based commercial casinos are currently permitted in 27 states: Arkansas, Colorado, Delaware, Florida, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Missouri, Nebraska, Nevada, New Jersey, New Mexico, New York, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Dakota, Virginia, and West Virginia.

In addition, the Indian Gaming Regulatory Act of 1988 (IGRA) grants federally recognised Native American tribes the exclusive right to regulate gaming activity on Indian (Native American) lands if the gaming activity is not specifically prohibited by federal law and is conducted within a state that does not, as a matter of criminal law and public policy, prohibit such gaming activity. Today, tribal casinos operate in 29 states across the United States.

Lotteries are the most widespread form of legalised gambling in the US, offered in every state except Alabama, Alaska, Hawaii, Nevada, and Utah. State lotteries are typically operated by state agencies and are not offered by commercial operators.

State law serves as the primary regulatory authority with respect to gambling, while federal law mainly plays a supporting role. The most relevant federal laws that address gambling include the Interstate Wire Act of 1961 (18 USC, Section 1084) (the “Wire Act”), the Unlawful Internet Gambling Enforcement Act of 2006 (31 USC, Sections 5361–5367) (the UIGEA), the Interstate and Foreign Travel or Transportation in Aid of Racketeering Act (18 USC, Section 1952) (the “Travel Act”), and the Illegal Gambling Business Act (18 USC, Section 1955).

The Wire Act prohibits the use of wire communication channels across state lines or international borders for betting or wagering, with exceptions for transmitting news about sports events and for placing bets where legal in both locations. Initially, the US Department of Justice (the DOJ) interpreted the Wire Act to cover all forms of online gambling. In 2011, the DOJ clarified that it applied only to sports betting. In 2018, however, the DOJ reversed its 2011 opinion, stating that the Wire Act applies to all forms of online gambling, not just sports betting. This reversal created uncertainty and legal challenges, particularly for states that had already legalised various forms of online gambling based on the 2011 interpretation.

The UIGEA prohibits banks and other financial institutions from processing financial transactions with internet gambling sites. This law makes it illegal for gambling sites to accept payments or transfer monetary payments to a player based in the US. The UIGEA made it a federal offence for any person engaged in the business of betting or wagering to knowingly receive funds from an individual involved in unlawful internet gambling. The law defines “unlawful internet gambling” as “to place, receive, or otherwise knowingly transmit a bet or wager by any means which involves the use, at least in part, of the Internet where such bet or wager is unlawful under any applicable Federal or State law in the State or Tribal lands in which the bet or wager is initiated, received, or otherwise made.” Additionally, it defined “bet or wager” as “the staking or risking by any person of something of value upon the outcome of a contest of others, a sporting event, or a game subject to chance, upon an agreement or understanding that the person or another person will receive something of value in the event of a certain outcome”. The act also mandated the creation of regulations requiring financial institutions to identify and block transactions related to unlawful internet gambling. Such regulation (Reg GG (12 CFR 233)) requires financial transaction providers to establish procedures to identify whether their commercial clients are operating as internet gambling businesses, and if so, to verify whether their gambling activities are legal.

The Illegal Gambling Business Act imposes penalties, including fines and imprisonment, on any individual who “conducts, finances, manages, supervises, directs, or owns” an “illegal gambling business”. An “illegal gambling business” includes any gambling enterprise that violates the law of the state or political subdivision in which it is conducted. Thus, the Act plays a role in enforcing state regulations. This Act also specifically targets large-scale operations generating USD2,000 or more in daily gross revenue, particularly those linked to organised crime, and does not apply to small-scale or individual gambling activities.

The Travel Act (18 USC, Section 1952) prohibits the use of interstate or foreign travel or transportation to further unlawful activity. The term “unlawful activity” specifically includes any business operation that involves gambling, provided it violates either the laws of the state where the illegal acts occur or federal laws. The Travel Act establishes a federal mechanism to penalise businesses that use interstate or international facilities in violation of state law. It serves as federal support for enforcing state regulations. The application of the Travel Act largely depends on the specifics of the relevant state law, meaning that without a state law violation, there can be no violation of the Travel Act.

It is also worth noting that the Professional and Amateur Sports Protection Act (PASPA) prohibits wagering on sporting events involving human athletes, with a few exceptions for states like Nevada, which had already established legalised sports gambling before the law was passed. In 2016, however, New Jersey challenged the constitutionality of PASPA, asserting that the state should have the right to repeal its own sports betting prohibitions. In May 2018, the Supreme Court ruled in Murphy v National Collegiate Athletic Association that the statute was indeed unconstitutional, thereby invalidating PASPA.

Although the definition of gambling varies from state to state, most states regard gambling as consisting of three elements: (i) risking something of value; (ii) the occurrence of a chance event; and (iii) a potentially valuable prize. In other words, for a game machine to be considered gambling, it must involve:

• consideration;
• chance; and
• a prize.

When all three elements are present, an activity is generally classified as gambling and requires state authorisation. However, if one of these elements is removed or modified, the activity may fall outside gambling laws. For example, skill-based games or contests eliminate the element of chance, and sweepstakes promotions remove the element of consideration by offering free alternative methods of entry.

Consideration

For a gameplay mechanism to constitute gambling, players must risk, bet, wager, or stake something of value, which serves as the consideration element of gambling. Although wagers of legal currency clearly satisfy the consideration element, jurisdictions differ in their interpretations of what constitutes sufficient consideration when the item risked is not legal currency. While most states require that the consideration be something of marketable value, a minority of states interpret “something of value” more broadly, finding consideration if the operator benefits in any manner from the participants’ actions.

Some states, including Alabama (AL Code, Section 13A-12-20), Alaska (AK Statutes, Section 11.66.280), Hawaii (HI Revised Statutes, Section 712-1220), Kentucky (KY Revised Statutes, Section 528.010), Missouri (MO Revised Statutes, Section 572.010), Nebraska (NE Code, Section 28-1101), New Jersey (NJ Revised Statutes, Section 2C:37-1), New York (NY Penal Law, Section 225.00) and Washington (WA Revised Code, Section 9.46.0285), have defined “something of value” to include any tokens or credits “involving extension of a service, entertainment, or a privilege of playing at a game or scheme without charge”. In particular, the Ninth Circuit held that virtual items extending entertainment privileges may constitute consideration in gambling analysis under Washington State law.

Chance

For a gameplay mechanism to constitute gambling there must be an element of chance, where the outcome is outside the player’s control. However, if player outcomes are not determined by chance, but are rather achieved through a player’s skill, the element of chance is removed, and the game may not be considered gambling. Most US courts use either the predominance test, the material element test, or the any chance test to assess the roles of skill and chance in determining a game’s outcome.

The predominance test

The predominance test is the most commonly used indicator of whether a game is skill- or chance-based. Under this test, games are considered on a continuum, with pure skill on one end and pure chance on the other. Games such as chess would be almost at the pure skill end, while games in which outcomes are completely randomised, like traditional slot machines, would be at the pure chance end. A game is classified as a game of skill if the game falls predominantly toward the skill end of the continuum.

The material element test

Some states evaluate whether a game is skill- or chance-based by determining whether or not chance plays a material role in determining a game’s outcome. For example, even if a game requires considerable player skill, if a chance-based mechanism can intervene to alter the outcome, then skill may predominate, but chance still plays the material role in determining the result.

The any chance test

The any chance test is the strictest test for classifying skill-based games and can render wagering on nearly any game as illegal gambling. Under this test, if any element of chance affects the outcome, the game is considered a game of chance.

Prize

In addition to consideration and chance, for an activity to constitute gambling, the player must have the potential to win a valuable prize, or “something of value”. Courts typically interpret “something of value” for the prize element of gambling the same way they interpret it for the consideration element. Most chance-based games do offer a prize. While it is usually clear whether or not a game offers a prize, sometimes a prize takes a less obvious form, such as virtual currency or plays of the game.

Generally, virtual items that can be cashed out into fiat currency satisfy this “prize” element, whereas virtual items that cannot be cashed out are generally not considered “something of value”. For example, in Taylor v Apple, Inc., No 20-cv-03906-RS (N.D. Cal. 2022), a California trial court ruled that loot boxes in the mobile game Brawl Stars did not constitute illegal gambling devices because the virtual item prizes offered within the game lacked value outside of the game. Another California trial court, in Coffee v Google LLC., No 5:20-cv-03901-BLF (N.D. Cal. 2020), held that even loot box items with value on secondary trading markets did not qualify as “things of value” for gambling statutes if those trades violated the applicable terms of use. Likewise, in Mason v Machine Zone, Inc., No 15-2469 (4th Circuit 2017), the Fourth Circuit found no grounds for recovery under Maryland’s gambling loss recovery statute when a plaintiff only had the chance to win virtual currency that could not be exchanged for real-world currency.

However, in Kater v Churchill Downs Inc., 886 F.3d 784, 788 No 2 (9th Circuit 2018), the Ninth Circuit found that although a social casino game’s virtual chips have no monetary value and could not be exchanged for cash, the game did contain a mechanism for transferring chips between users, which could be used to “cash out” winnings. In addition, in Larsen v PTT, LLC, 3:18-cv-05275-TMC (W.D. Washington, 11 June 2024), the Western District Court of Washington found the virtual coins of two social casino games, High 5 Casino and High 5 Vegas, constitute “things of value” even if such virtual coins could not be exchanged for real-world currency, and the court determined that “Washington law does not limit a virtual chip’s value to whether it can be exchanged for cash or goods” and held that the “coins need no intrinsic pecuniary value – their value derives from their usability in enabling gameplay”.

There is no specific legal definition of land-based gambling at the federal level. The term is generally used as an industry descriptor to distinguish in-person gaming from online or remote play. Each state defines and regulates the forms of gambling permitted within its jurisdiction through its own statutes and regulations.

In practice, land-based gambling refers to gaming activities conducted at physical venues, including slot machines, table games, and card games such as poker.

There is no specific legal definition of “online gambling” at the federal level, but the UIGEA defines “unlawful internet gambling” as “place, receive, or otherwise knowingly transmit a bet or wager by any means which involves the use, at least in part, of the Internet where such bet or wager is unlawful under any applicable Federal or State law in the State or Tribal lands in which the bet or wager is initiated, received, or otherwise made.”

The term generally refers to wagering or gaming activities conducted through the internet or electronic devices, including computers, mobile phones, and tablets.

In the US, illegal gambling offences arise under both state and federal law, depending on where and how the unlawful activity occurs.

Both federal and state laws impose criminal penalties against those who offer or promote unlawful gambling. For example, at the federal level, the Illegal Gambling Business Act (IGBA) (18 USC, Section 1955) provides that anyone who conducts, finances, manages, supervises, directs, or owns all or part of an illegal gambling business may be fined or imprisoned, or both.

The statute defines an illegal gambling business as a gambling operation that:

• violates the law of the state or political subdivision in which it is located;
• involves five or more persons who conduct, finance, manage, supervise, direct, or own all or part of the business; and
• has been, or remains, in substantially continuous operation for a period of 30 days or more or has gross revenue of USD2,000 or more on any single day.

Merely participating in unlawful gambling is generally not a criminal offence at the federal level. However, at the state level, some jurisdictions criminalise the act of gambling itself, typically classifying it as a misdemeanour punishable by fines or short-term imprisonment.

At the federal level, any person who “conducts, finances, manages, supervises, directs, or owns all or part of an illegal gambling business” may face both criminal and financial penalties:

• fines and/or imprisonment for up to five years (18 USC, Section 1955(a)); and
• seizure and forfeiture of any property, including money, used in or derived from the illegal gambling business (18 USC, Section 1955(d)).

In the USA, state agencies and tribal gaming commissions serve as the primary regulators of gambling. Each state that permits gambling establishes its own gaming commission, control board, or lottery agency to license operators, enforce compliance, and oversee responsible gaming programmes. For example, in Nevada, the Nevada Gaming Control Board regulates and oversees the state’s gambling industry, while in New Jersey, the Division of Gaming Enforcement performs a similar role. These agencies are responsible for conducting licensing suitability reviews, ensuring operational integrity, and monitoring financial reporting to maintain compliance with state gaming laws.

Tribal casinos, in turn, are regulated under the Indian Gaming Regulatory Act (IGRA) and operate pursuant to tribal–state compacts. Oversight is shared among tribal gaming commissions, state regulators, and the National Indian Gaming Commission (NIGC) at the federal level, which ensures compliance with both tribal and federal gaming standards.

State laws with respect to gambling vary widely. Generally, however, gambling is prohibited unless the state enacts legislation expressly permitting such conduct.

Most state gaming commissions implement detailed, rule-based systems that specify licensing standards, technical requirements, internal controls, and reporting obligations. These prescriptive frameworks are designed to ensure operational integrity, consumer protection, and transparency across all licensed operations.

Gambling regulation in the USA is primarily state-based, with licensing requirements varying by state and by type of activity.

The main categories typically include:

• licences for gaming operators;
• licences for manufacturing or supplying devices or equipment; and
• licences for officers, directors, and key employees involved in gaming operations.

Some states may distinguish licences in greater detail. For example, in Delaware, operational licences are divided into “restricted” and “non-restricted” licences. The “restricted” licence applies to persons or entities conducting “restricted” gaming operations consisting of no more than 15 slot machines, which allows gaming operations in taverns and grocery stores. Persons or entities conducting “non-restricted” gaming operations consisting of 16 or more slot machines, other games (such as table games, keno, and bingo), or race and sports pools must apply for “non-restricted” licences.

The availability of gaming licences in the USA varies by state and is generally subject to stringent suitability and regulatory requirements.

For example, in Nevada, there is no fixed numerical cap on the number of gaming licences that may be issued. In contrast, many other states have a cap on the number of licensed casinos. Under the Illinois Gambling Act, for instance, only up to 16 operator licences may be issued for casino gambling. In New Jersey, there is no limitation on the numbers of the operator licences, but casino gambling is restricted to Atlantic City.

However, there is usually no restriction on the number of licences for suppliers of gaming devices or equipment that can be issued.

The duration of a gambling licence in the USA differs by state and licence type, as each jurisdiction sets its own renewal schedule and conditions. For example, New Jersey requires renewal for casino licences every five years, while in Nevada, the casino licence is subject to annual renewal and ongoing suitability review.

Most states require gaming operation licence applicants to demonstrate suitability, which generally includes good character, honesty, and integrity. This standard reflects a consistent policy objective – ensuring that the gaming industry is not perceived as corrupt or influenced by criminal activity.

Accordingly, applicants with prior felony convictions may be disqualified from obtaining a licence to operate gaming machines or facilities. Similarly, a state gaming board may deny an application if an applicant or its owners maintain personal or professional associations with convicted felons or with individuals or entities under investigation for illegal gambling or related offences.

In addition, applicants for gaming licences are also required to prove, by clear and convincing evidence, their financial stability, integrity, and responsibility. This evaluation extends to the applicant’s holding companies, affiliates, and other qualifying entities. Suitability reviews assess not only solvency but also honesty, transparency, and sound judgement in business dealings – including how prudently and responsibly applicants manage and safeguard assets under their control.

It is difficult to estimate precisely how long a gambling licence application will take, as each state follows its own independent review process and timeline.

The overall timing generally depends on:

• the type of licence sought (eg, land-based operator, online operator, supplier, or key employee);
• the scope and depth of the background investigations required;
• the responsiveness of the applicant in providing supplemental information;
• the availability and workload of the state’s regulatory staff; and
• whether or not the application raises any suitability concerns that require additional review.

For example, Nevada laws do not provide a deadline for licence application submissions, but in practice the application process of a non-restricted operator licence involves a comprehensive background check that can take nine months to more than a year.

Application fees vary significantly across states and depend on the type of licence and scope of operations.

For example, in Nevada the initial application fee for operating interactive gaming is USD500,000, and in New Jersey the initial application fee is USD100,000.

Most states require licensed operators and suppliers to pay ongoing annual fees to maintain their authorisation. The amount and structure vary by state and licence type. Some states charge a flat annual renewal fee, while others impose graduated fees or taxes based on revenue.

Individuals involved in the management, control, or operation of gambling businesses in the USA are generally required to obtain personal authorisations or licences from state gaming authorities. Licensing triggers when a person holds a substantial ownership interest, exercises managerial authority, or performs key operational duties such as compliance, finance, or gaming supervision.

The application process typically involves detailed personal disclosure and a background investigation, including criminal, financial, and tax record checks. Applicants must demonstrate honesty, integrity, good character, and financial responsibility. In most states, the process includes fingerprinting, sworn personal history forms, and interviews conducted by the state’s gaming control board.

Fees and timescales vary by jurisdiction. For instance, personal key employee licences in New Jersey require a USD750 application fee plus an investigation fee of up to USD4,000 (NJ Admin Code 13:69A-9.11) and the registration generally lasts indefinitely unless the person left the industry for three years (NJ Admin Code 13:69A-7.1C), while in Nevada, the Nevada Gaming Control Board charges a licence fee ranging from USD500 to USD1,000 depending on the type of licence, plus an investigation fee, and the review is generally completed within nine months (Nevada Revised Statutes, Section 463.210).

The types of physical premises authorised for gambling in the USA differ by state law. Geographic limitations on licensure take on several forms in the various states.

For example, in Nevada, a “restricted” licence is required for operators in taverns with less than 15 slot machines. Some states, like Illinois, Mississippi, and Louisiana, allow riverboat casinos.

Additionally, state gambling regulators may deny an operator’s licence if they deem the proposed premises to be unsuitable. For example, in Nevada, premises located in close proximity to churches, schools, or public playgrounds, premises that attract a substantial number of minors, locations that are difficult for law enforcement to access, premises that violate local zoning ordinances, and other premises restricted by applicable laws, are typically considered unsuitable for conducting gaming operations (Regulation 3: Licensing: Qualifications).

In the USA, only a small number of states – including New Jersey, Pennsylvania, Michigan, Delaware, Connecticut, Rhode Island, and West Virginia – currently permit online gambling, such as online casino games and poker. However, more states permit mobile and online sports betting (see 2.1 Online Gambling).

In these jurisdictions, the licensing process for online gambling operators is largely the same as for land-based casinos. Applicants must obtain a state-issued operator licence, meet suitability and financial standards, and comply with strict technical requirements for geolocation, player verification, data security, and responsible gaming. Many states, such as New Jersey and West Virginia, require online gaming operators to partner with a licensed land-based casino or tribal gaming entity to obtain market access and lawfully offer online platforms.

Because of these restrictions, many international gaming companies have turned to alternative business models to reach US players. Two common structures are:

• sweepstakes casinos, which remove the element of consideration by allowing players to participate without purchasing credits, positioning the games as promotional sweepstakes rather than gambling; and
• skill-based gaming platforms, which remove the element of chance, framing outcomes as dependent primarily on the player’s skills.

While these models have gained popularity, they also attract regulatory scrutiny, and several states have introduced or proposed laws aimed at restricting sweepstakes casinos that closely resemble real-money gambling (see details in 1.1 Current Outlook and Recent Changes).

In the USA, suppliers that provide goods or services directly related to online gambling activities are generally required to obtain a licence, while vendors that offer supporting or ancillary services may need to register with state regulators. Because gambling regulation is state-based, licensing requirements and structures vary across jurisdictions.

For example, in New Jersey (NJ Admin Code 13:69J-1.2), licensing of casino service industry enterprises is required for companies “providing Internet gaming software or systems, vendors who manage, control, or administer games and associated wagers conducted through the Internet, and providers of customer lists of persons who have placed wagers through the Internet” and “sports pool or online sports pool software or systems, sports wagering kiosks, or that accept wagers from patrons and vendors who manage, control, or administer associated wagers.”

An ancillary licensing of casino service industry enterprises is required for services, including, “payment processing and related money-transmitting services with direct contact with patrons’ casino gaming or online sports pool accounts or the Internet gaming system itself, customer identity, age verification, geo-location verification used in the conduct of Internet and mobile gaming, and entities that determine what wagers to accept or the odds to be offered for a wager for a sports pool manager or operator.”

Additionally, certain companies that (i) provide telecommunication or infrastructure services, (ii) offer data, analytics, or proprietary information, or (iii) provide advisory or consulting services related to online gambling are required to be registered with the New Jersey Division of Gaming Enforcement.

However, in Nevada (NV Revised Statutes, Section 463.650), there are no registration requirements, but the law prohibits “any person, either as owner, lessee, or employee, whether for hire or not, to operate, carry on, conduct, or maintain any form of manufacture, selling or distribution of any gaming device, cashless wagering system or interactive gaming system for use or play in Nevada without first procuring and maintaining all required federal, state, county, and municipal licenses.”

Affiliate marketing in online gambling is regulated at the state level, and requirements differ across jurisdictions. Generally, affiliates that receive revenue share or commission-based compensation must register or obtain approval from state gaming authorities, as they have a financial interest in gambling outcomes.

Affiliates must also comply with advertising and responsible gambling standards, including avoiding misleading promotions, targeting minors, and displaying helpline information. Licensed operators are responsible for monitoring their affiliates’ conduct and ensuring compliance with state advertising and marketing laws.

White-label models, where an unlicensed brand operates under another company’s gambling licence, are not generally permitted in the USA. Gambling regulation in the USA is state-based, and each licensed operator must be individually approved by the relevant state regulator.

State laws impose rigorous technical and cybersecurity standards to ensure player protection, system integrity, and real-time regulatory oversight. Each licensed operator must maintain certified gaming systems located within the state, implement robust data security controls, and operate under the continuous supervision of state gaming authorities.

For example, New Jersey Administrative Code, Section 13:69O-3.1 sets out comprehensive technical requirements for remote gaming systems, including certification standards, system architecture, data protection measures, and connectivity with the regulator’s monitoring network.

Responsible gambling (often referred to as safer gambling) is a fundamental principle of the US gaming regulatory framework. Although there is no single federal policy, every state that authorises gambling – whether land-based, tribal, or online – requires operators to implement measures that protect players and promote safe, transparent participation. These measures are designed to prevent harm, ensure fair play, and maintain public confidence in the gaming industry.

At the national level, organisations such as the American Gaming Association (AGA) lead voluntary programmes and publish reports that complement state responsible gaming laws. Across the jurisdictions with legalised commercial or online gambling, responsible gaming regulations commonly include the following elements.

• Responsible gaming plans – operators are generally expected to develop and maintain a written plan outlining how they promote responsible play. These plans typically cover employee training, player-education initiatives, and public-awareness measures.
• Self-exclusion programmes – licensed operators must provide mechanisms that allow individuals to voluntarily exclude themselves from gambling activities, both in-person and online. Operators are required to honour self-exclusions by denying access, credit, or marketing to enrolled individuals.
• Signage and information disclosure – gaming venues and digital platforms are expected to display clear and visible responsible-gaming messages, educational materials, and helpline numbers in all gaming areas and advertisements.
• Advertising standards – gambling advertising must be factual, transparent, and socially responsible. Marketing may not mislead consumers, target minors or vulnerable persons, or suggest that gambling is a solution to financial or personal difficulties.
• Player-control tools – online and mobile operators are encouraged or required to offer features that allow players to set deposit, loss, or time limits, helping individuals manage their gaming behaviour.
• Support and research funding – a portion of gaming revenue or operator contributions is often directed toward problem-gambling treatment, prevention, and research initiatives.
• Employee training – gaming personnel must receive regular training to identify and respond appropriately to signs of problem gambling and to manage self-exclusion or intervention procedures.
• Alcohol and conduct policies – operators are expected to limit alcohol service on gaming floors and to refuse gambling access to visibly intoxicated patrons.

See 7.1 RG Requirements.

In the USA, AML regulations are generally implemented at the federal level. The key law is the Bank Secrecy Act of 1970 (the BSA), and other relevant laws include the Money Laundering Control Act of 1986, the USA Patriot Act of 2021, and the Anti-Money Laundering Act of 2020. State-level AML laws and regulations generally work in conjunction with these federal laws.

The Financial Crimes Enforcement Network (FinCEN), a bureau of the US Department of the Treasury, enforces AML obligations.

Casinos are treated as “financial institutions” under the BSA, and thus are required to:

• file currency transaction reports for cash transactions exceeding USD10,000 as a daily aggregate amount;
• submit suspicious activity reports for unusual transactions;
• maintain records for certain financial transactions;
• establish programmes to verify customers’ identities and monitor their transactions; and
• report foreign bank accounts with balances exceeding USD10,000 (31 CFR Part 1021).

There is no single federal authority dedicated to regulating gambling advertising in the USA. Oversight is shared among multiple agencies and state regulators, depending on the type of gambling and the nature of the advertisement.

At the federal level, 18 US Code, Section 1302 prohibits “any newspaper, circular, pamphlet, or publication of any kind containing any advertisement of any lottery, gift enterprise, or scheme of any kind offering prizes dependent in whole or in part upon lot or chance” (“Publication Advertising Restrictions”), and Section 1304 prohibits broadcasting of “any advertisement of or information concerning any lottery, gift enterprise, or similar scheme, offering prizes dependent in whole or in part upon lot or chance” (“Broadcasting Advertising Restrictions”), except for a state-run lottery, tribal gaming, licensed casinos in Nevada, sports betting where legal, and any form of gambling that it legal in the jurisdiction being advertised (18 US Code, Section 1307).

Additionally, the FTC, particularly its Division of Advertising Practices, enforces federal “truth-in-advertising” laws. While it does not regulate gambling advertising exclusively, it covers deceptive or unfair advertising practices by gambling operators and promotions.

At the state level, each state containing regulated gambling has a regulator with authority over advertising within its jurisdiction (see details in 9.3 Key Legal, Regulatory and Licensing Provisions).

At industry self-regulatory level, the industry association, the American Gaming Association (AGA), issues the Responsible Marketing Code for Sports Wagering and other self-regulatory standards for gambling advertising and promotion. While voluntary for members, it influences best practices.

There is no specific state definition of advertising at the federal level. Some states have defined the term “advertising” or “advertisement” specifically for gambling activities, but other states just have a general definition for all business.

For example, in New York, “advertisement” is defined under NY Rac, Pari-Mut Wag & Breeding L, Section 1363 as “any notice or communication to the public or any information concerning the gaming-related business of a gaming facility licensee or applicant or a mobile sports wagering licensee as defined in Section 1367 of this article through broadcasting, publication or any other means of dissemination, including electronic dissemination.”

In Nevada, the “advertising” is defined in the context of consumer protection law under NV Revised Statutes, Section 598.0905 as “the attempt by publication, dissemination, solicitation or circulation to induce, directly or indirectly, any person to enter into any obligation to lease or to acquire any title or interest in any property.” This definition is not specifically for the gambling business.

The regulatory requirements differ by state. However, many states apply the following principles to gambling advertisement.

• Accuracy and honesty – all advertising must be based on facts and not be false, deceptive, or misleading. Operators must clearly disclose all material conditions, limitations, and eligibility requirements associated with a bonus offer. No design, font, or colour scheme may obscure essential information. States are also focusing on misleading promotional language, and terms such as “risk-free” or “free money” are prohibited.
• Restriction on targeting minors – advertisements shall not target individuals under the age of 21 (or another age depending on state laws).
• Responsible play – advertisements may not suggest that gambling can be a way to achieve financial success or resolve personal problems, or suggest that gambling is a rite of passage or a socially required activity.
• Help hotline requirement – gambling advertisements are usually required to clearly display a problem-gambling helpline number, ensuring access to responsible-gaming resources. The disclaimers, such as “Gambling Problem? Call 1-800-GAMBLER”, must be a clear and conspicuous part of any advertisement.
• Direct marketing restrictions – operators must provide opt-out methods by which an individual may designate that they do not wish to receive any future direct advertisements.
• Record keeping – operators are usually required to maintain a complete record of advertisements for a period of time (usually one or two years).

See 9.3 Key Legal, Regulatory and Licensing Provisions.

At the federal level, a violation of the Publication Advertisements restrictions shall result in a fine or imprisonment of up to two years, or both; and any subsequent offence shall result in imprisonment of up to five years (18 US Code, Section 1302). A violation of the Broadcasting Advertisement restrictions shall result in a fine or imprisonment of up to one year, or both (18 US Code, Section 1304).

Additionally, gambling advertising is subject to the Federal Trade Commission Act (15 USC, Sections 41–58), which prohibits unfair or deceptive acts or practices in commerce. The FTC has the authority to take civil enforcement actions against misleading or false gambling advertisements. Remedies typically include injunctive relief, requiring the advertiser to cease deceptive conduct, and civil penalties of up to USD50,120 per violation (adjusted annually for inflation).

At the state level, sanctions and penalties vary by state, and many states do not have specific penalties for advertising.

As a general rule, any acquisition or change of control involving a licensed gaming company in the USA requires prior regulatory approval from the relevant state gaming authority. Each state establishes its own shareholding thresholds that determine when an acquirer must apply for licensure or obtain a finding of suitability, which is a formal determination that the buyer or investor meets the state’s standards of honesty, integrity, and financial responsibility.

Each state sets its own ownership thresholds for when an acquirer must apply for approval or obtain a finding of suitability. The thresholds vary depending on whether the acquisition involves a direct interest in the licensed casino entity or an indirect interest through a holding or parent company.

• At the direct casino-licence level, any transfer of ownership is subject to regulatory approval and a suitability review.
• At the holding or parent-company level, regulatory scrutiny applies only when the acquirer obtains a “controlling interest”, which is defined differently across jurisdictions and entity types.

State gambling laws generally require regulatory approval for anyone directly acquiring an ownership interest in a licensed gaming company. However, for publicly traded gaming companies, several states establish ownership thresholds that trigger a suitability review. For instance, in Nevada, acquiring 10% or more of the voting securities of a publicly held gaming company generally requires the acquirer to apply for a finding of suitability.

Some states also exempt institutional owners from licensing requirements up to certain specified thresholds, provided those owners are passive. The thresholds vary: in New Jersey the limit is 25% (NJ Revised Statutes, Section 5:12-85.1), while in Pennsylvania, the threshold for institutional investors’ ownership is 20% (4 PA Consolidated Statutes, Section 13B62).

As discussed, regulation of the gambling industry in the USA occurs primarily at the state level, with each state’s gaming authority responsible for overseeing licensing, compliance, and enforcement within its jurisdiction.

State gaming regulators actively supervise and monitor compliance through preventive measures rather than relying solely on penalties. Most jurisdictions establish standardised Minimum Internal Control System (MICS) requirements, setting out operational, accounting, and security standards for all licensed casinos. Each licensee must submit its own internal control plan for approval, covering the conduct of games, cash handling, surveillance, and recordkeeping to ensure transparency and accountability.

In addition to periodic audits and compliance reviews, many states require the continuous presence of regulatory agents or inspectors at gaming facilities. These agents oversee day-to-day operations, verify adherence to approved controls, and report any irregularities to the state gaming authority.

When violations occur, sanctions are imposed by the relevant state regulator. These may include monetary fines, licence suspension, or revocation, or, in serious cases, criminal prosecution initiated by the state attorney general.

Financial penalties are typically determined on a case-by-case basis, depending on the severity and nature of the violation.

Each state imposes its own gaming taxes and licensing fees, typically based on gross gaming revenue (GGR). Tax rates vary significantly across jurisdictions, depending on the type of gaming activity and policy objectives.

For example, in Nevada, casinos are taxed at approximately 6.75% of GGR, one of the lowest rates in the country; whereas in Pennsylvania, some of the nation’s highest rates apply, exceeding 50% on certain slot machine operations. Online gaming and sports betting are often taxed under separate frameworks – for example, New York imposes a 51% tax rate on online sports wagering revenue.