Online casino legalization progress has been slow in recent years and that isn’t expected to change in the short term.
But one industry expert said he believes a large wave of states legalizing and regulating online casino is on the horizon.
Speaking at the Global Gaming Expo (G2E) in Las Vegas last week, Howard Glaser was bullish on the medium-term prospects for online casino legalization.
“If I look five-to-seven years ahead, I think more than half of the US states which have land-based gaming will have adopted iGaming by that point,” said Glaser, the global head of government affairs and legislative counsel at Light & Wonder.
Why Glaser is bullish on iGaming efforts
There are 44 states in the US with commercial or tribal casinos. Currently, online casino is only legal and authorized in seven states: New Jersey, Pennsylvania, Michigan, Delaware, West Virginia, Connecticut and Rhode Island.
So Glaser predicts at least 16 more states to legalize online casino by 2030.
Ultimately, Glaser’s optimism comes down to money.
He cited statistics for gross gaming revenue in the month of July. Sports betting totaled $497 million total in 36 states. Online casino nearly matched that total with $481 million in six states (Rhode Island has yet to launch).
“It gives you a sense of what the power is in terms of the performance of iGaming,” Glaser said. “If you were to assume that all of the states today that have land-based legal casino gaming were to adopt internet gaming, how big is that market? It’s about $30 billion.”
Glaser previously spoke with PlayUSA for an article about why online casino legislation has moved slowly coming out of the pandemic.
He expects states are going to run out of revenue in their annual budgets in coming years as they run out of the $293 billion in federal government payments made directly to states post-COVID.
“That money made the states very flush,” Glaser said. “That money is starting to run out this coming fiscal year. States which have been cash-positive are starting to go cash-negative, and it gets worse in 2025. When legislators suddenly need to plug a budget hole, they can pull iGaming off the shelf and plug it in.”
Online casino momentum will start in next two years
For an additional 16 states to legalize online casino in the next seven years, momentum needs to build quickly.
Glaser won’t make any predictions for 2024. It’s an election year and state lawmakers are still moving past the fatigue from sports betting legalization.
But he said he thinks a big state will legalize online casino in 2025 to start the next wave.
“I really do think it takes just one big state to unlock a tipping point,” Glaser said. “In the next 24 months, you will see one or more of these states legalize online casino: New York, Indiana, Iowa, Maryland, possibly Louisiana.”
Industry leaders stress need to show iGaming already happening
In another G2E panel, FanDuel CEO Amy Howe and DraftKings CEO Jason Robins spoke about their hopes for online casino growth.
Asked why more states haven’t embraced iGaming, Robins responded:
“First, I think they will. Sometimes things happen over time. Everybody’s excited and we all want it now, but it takes time. Especially when it comes to legalizing and regulating. But I think it’s going to continue to be something that we see more and more states take up.”
Robins said one key factor that helped with the push for sports betting legalization was that lawmakers understood there was a large illegal market. But they don’t realize the same is true for online casino.
“Almost every offshore sportsbook has a casino tab,” Robins said. “I mean, there is a large online casino market as well. But nobody talks about it. It’s not as social an activity, I guess, and it’s just not as well known. So I think we need to do a better job getting the message out there and educating people that this is actually quite similar to the sports story.”
Howe agreed that it’s happening whether people want to accept it or not. She pointed out that just 13% of the US population can engage legally in iGaming. So of course people are engaging illegally.
“I think, over time, we can figure out how to thread that needle to the fact it exists and the revenue is not going to the states.”