Israel has become a strong player within the iGaming industry, hosting online casinos in many markets, but it’s the growth in the USA that has sparked a major interest.
With the global growth of iGaming, estimated to reach $93bn by 2023, one country, in particular, has already set its sights on becoming a dominating force in the USA. Considering the USA has a complicated history regarding gambling laws, many Israeli iGaming companies have managed to set up shop, offering a host of online casino games.
As it stands, there are currently only five states in the US that have made online gambling legal - New Jersey, Delaware, Pennsylvania, Michigan, and West Virginia. This could be set to change as some states have pushed bills to make online casino gambling legal, making way for the development of more US online casinos and giving players plenty of choices.
Let’s take a closer look at how Israel is leading the pack and whether the US will soften its laws to permit more forms of online gambling.
US Gambling Laws
Although there’s a tight lid on US Gambling Laws, it has become evident that online gambling is extremely profitable, so we could be seeing a rise in US online casinos in the future. The US online gambling market is slowly opening up and there’s an increasing presence of regulated online casinos available for US players.
A quick look at The Unlawful Internet Gambling Enforcement Act of 2006 will further explain how Israeli iGaming companies have been able to operate in the US. This law states that it is illegal to operate an online gambling website anywhere in the US, however, it is not illegal for players to bet in an online casino. At the turn of the millennia, this led to the rise of so-called "offshore casinos". These sites accept US players but aren't regulated by any state.
New Jersey was one of the first states to legalize all forms of online gambling, including online casinos. As a result, international online casino brands have formed partnerships with local land-based operators and now offer their products in the Garden State. Other states have recently followed suit: players from Pennsylvania, West Virginia, Delaware and Michigan can access perfectly legal online casinos in their home state.
This is why you’ll see Israeli companies already operating in states where online casino gaming is legal.
Brief History of Israeli iGaming
Israel’s success in the iGaming industry can be attributed to innovation, leading software, and creativity. Their dominance may come as a shock considering The Israeli Penal Law 5737 - 1977 only permits horse race betting, the national lottery (Mifal Hapayis), and sports betting (Israel Sports Betting Board).
Unsurprisingly, many entrepreneurs and businessmen saw the potential in iGaming earlier on, and so many were able to back several start-ups, believing this would boost the economy and give Israel a solid foundation within this industry. Consequently, we saw the creation of many global brands.
Not all Israeli iGaming companies are online casinos or sportsbooks, there are also big game developers, who for instance, create slot machines. This has been a big part of Israel’s success story.
So what about the Israeli companies that have actual US online casinos? Well, the very first online casino allowed to operate in the US was actually Israeli-owned and gained its license as an Interactive Gaming Service Provider from the Nevada Gaming Commission in 2013. Since then, other Israeli companies have entered the US market and we expect to see many more.
Future of US Online Casinos
Despite heavy legislation, Israeli companies have no doubt made a significant impact in the iGaming industry in the US. Whether it’s from supplying cutting-edge software and technology, or via mergers and acquisitions, the presence of Israeli gaming companies in the US is increasingly being felt.
It’s also important to take note of changing trends, particularly since the COVID-19 pandemic. Land-based casinos were the ones who took quite a hit whereas online casinos were continuously thriving.
The implications mean that many states in the US have considered changing their laws to allow online casino gambling and avoid taking another loss. This would present a significant opportunity for Israeli iGaming companies to enter various markets across states. We could soon see an Israeli online casino available in Illinois as a bill has recently been proposed to push online casino gaming.