The US online gambling market is experiencing unstoppable growth. Experts have predicted it will be worth 22 million by 2030. That’s a lot of growth, but one state that won’t have experienced much is California, which is opposed to online gambling in all its forms.
In fact, the US is an easy place to get into trouble if you enjoy gambling. The uneven regulation of online gambling creates confusion, since regulations vary from state to state, and what’s legal in one state could be illegal in another. California’s opposition to online gambling, however, makes it a market bursting with potential if lawmakers ever decide to legalize it.
The Growth of The US Online Market
The iGaming market showed how more and more people are taking to online casino gaming and online sports betting, and just how strongly the market is growing, when, in 2024, it recorded a combined iGaming revenue of $8.41 billion between seven states, excluding Nevada’s online poker market. New Jersey generated $2.39 billion in total iGaming revenue for the year, which was up 24% on the previous year, and annual revenue from online sports betting came to $1.06 billion, an increase of 10.2% compared to 2023.
Pennsylvania, another liberal state when it comes to gambling laws, also displayed significant growth. Revenue from internet gaming jumped by 28.6% from 2023, reaching $2.71 billion, and mobile sports betting, which increased by 15.9%, accounted for more than 95% of the overall total for sports wagering ($778.4 million).
And then there’s California….
Meanwhile, California, which has an estimated population of more than 39 million, is firmly opposed to online gambling, whether it’s online sports betting or online casino gaming. Despite this, citizens have shown a major appetite for casino gaming, reflected in the millions of visitors to tribal, brick-and-mortar casinos, the growth of these casinos, and the billions generated by the legal and grey markets.
The politics of legalization
The best hopes of iGaming becoming legal lie with the tribes, but this won’t come any time soon, since the tribes oppose online casino gaming. They argue it infringes on their rights (and could affect their profits) and have lobbied to keep the current regulations in place.
The resistance to legalization is more than about just money. In the debate about legalizing sports betting in the state, regulators have voiced fears around responsible gambling and potential exposure of minors to gambling. Meanwhile, the public fears legalized sports betting could jeopardize the integrity of sports. Legalizing iGaming would do nothing to quell any of these parties’ fears.
The impact of fragmented regulation
The fact that some states allow iGaming makes life complicated for operators and for the states themselves. Each state must develop its own licensing requirements, tax regimes — which are highly variable because of the fragmentation — audit/certification demands, geolocation mandates, product definitions, responsible gaming rules, advertising limitations, server locations, and more. Fragmentation can also drive grey-market behavior if an operator can operate legally in one state, but not in another, and players may flock to that operator regardless of the regulations.
Compliance creates further complications. Holding a license in New Jersey doesn’t mean access to New York or Pennsylvania, even though the states share borders. To comply, operators must duplicate procedures, adapt their marketing strategies, and rebuild their operating procedures time and time again. They must even adapt the products to comply with local laws. If an operator is thinking of expanding, consumer demand is less of a decisive factor than whether the online casino will be able to navigate the variations in regulation successfully.
The benefit of compliance is that when they’ve achieved it, operators can use their compliance as a marketing tool to build trust with players, meaning review sites like Casino.us list them as some of the most trusted online casinos in the US, resulting in more players signing up and depositing with them. This guidance is particularly important in regions like California, where regulation is less extensive than in some other states, making independent player awareness and platform vetting essential. The proof that games are fair, the provision of strong responsible gaming tools, and transparent marketing are strong differentiators that build trust with regulators and players. They can also steer players away from shady sites in favor of safer ones.
The Lobbyists
Although tribal casinos have been at the forefront of lobbying in California, and have been so against iGaming, there are parties in favor of iGaming. The Sports Betting Alliance, which includes some household names in (online) sports betting and pushed for legalized online sports betting with Proposition 27, still hopes to reach a middle ground with the tribal casinos and see online sports betting become legal in the state.
Online gambling is growing heavily in the US, and the market is flourishing, whereas state laws are obstructing the development of a legal online gambling market in California. The population and size of the state’s economy hold huge potential, if ever online gambling was to become legal there. Legalization would be a powerful development and catapult growth of the US market.
