How New Jersey Single Handedly Changed the Landscape of iGaming in the USA

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Investment in iGaming companies is at an all time high across the globe. The London Stock Exchange (LSE), the NASDAQ, and ASX all boast some of the largest companies involved in gambling be it land-based or online casinos, retail sports or online sports betting online or a mixture of both. Many of the best online casinos in New Jersey listed here operate under public companies floated on the NASDAQ, case and point, Caesars Entertainment – a NASDAQ listed iGaming, casino, and sports betting company trading under the NASDAQ ticker CZR.

Many of these companies’ that succeed in the US iGaming market owe much of their success to New Jersey which single handedly changed the landscape of iGaming in the USA via licensing and tech solutions.

The Introduction of New Licensing using Land-based Casinos

Online gambling was illegal US-wide due to the ‘Unlawful Internet Gambling Enforcement Act (2006) as well as The Federal Wire Act (1961). However, the New Jersey state government, very pro-online gambling, set out to pass a new bill that would effectively allow online casino operators to operate in the state. As a result, Bill No A2578 passed which would allow iGaming companies operating online casino platforms to operate in conjunction with land-based casinos operating in Atlantic City.

The bill solves the issue of gambling outside of Atlantic City, which is the only zone in the state that allows gambling activity. If the online casino servers are inside a fully licensed brick and mortar casino establishment, then bets are effectively being placed on the premises of a venue authorized to allow casino gaming. Not only was this law a genius way to get around some of the location issues surrounding online gambling, but it also makes certain that land-based casinos also have a share of the online market.

Today online casinos like Harrah's Online Casino and the globally renowned 888 Casino, listed on the London stock exchange, operate under the Caesars Atlantic City’s land-based license to obtain its official iGaming NJ license to operate iGaming services, while DraftKings, a NASDAQ listed US iGaming company, PokerStars Casino & Poker, both use Resorts Atlantic City’s land-based license.

It was New Jersey politicians and lawyers that devised this licensing plan and single handedly changed the landscape of iGaming in the USA by opening the doors for other states like Pennsylvania and Michigan to also introduce online casinos via their state licensed land-based casino operations.

Formed a Framework that Included B2B Game Developers & Suppliers

Although online casinos were able to operate in New Jersey under Bill No A2578, it didn’t come without other technicalities that needed ironing out. Online casinos can only operate if there are online casino games. That meant iGaming companies would need to have permission to operate within the state of Jersey in order to supply online casinos like 888, Caesars and Harrah's.

Some of the top iGaming software providers interested in supplying their games to online casinos included WMS, NetEnt, Evolution, and more. As a result, the New Jersey Division of Gaming Enforcement gambling authority devised the Casino Service Industry Enterprise (CSIE) license. As long as there is a tech partner in place to deliver these games onto the servers within the casino’s datacenter, then online casinos could legally offer games to their clientele.

The same CSIE license has also meant live casino studio game and software providers such as Evolution, Ezugi, and Playtech can select a property in Atlantic City for the purpose of streaming live casino games to the state’s regulated online casinos. For example, the license allows deals such as the PARX Casino NJ and Playtech partnership in order to deliver the software provider’s proprietary iGaming portfolio to the casino’s clientele.

Once again New Jersey found a way to bring a diverse number of video slot, virtual table games, and live dealer developers, all which have notoriety from regulated markets in Europe, into the New Jersey online casino market.

High Tech Solutions to Ensure Only New Jersey Could Play

There was another technicality that had halted the eventual approval of Bill No A2578. With VPNs very much accessible, how could online casinos guarantee that their players are situated in New Jersey?

The same problem any other state would have had. However, NJ tech experts solve this issue to satisfy yet another barrier put up by the legislature to get the bill approved.

Solutions included only allowing transactions from those with a bank account in New Jersey to making sure correct KYC checks were made to ensure those signing up were in fact NJ citizens/residents. Yet, this was not enough. In the end, the solution was to use a WiFi routers solution that could pick up the signal of other nearby WiFi routers or mobile signal (this is pre-2G/3G), to verify the player was not using a VPN. This was enough to satisfy the legislature. Other states such as Pennsylvania and Michigan use a similar method to verify new members. Now 4G/5G networks are in place with strong signals, using other WiFi routers is required.  

Yet, another revolutionary solution, and one many states used as part of their bid to pass bills that legalized online gambling, in their region.

New Jersey was the US iGaming Market’s Gamechanger!

New Jersey led the way along with Delaware to bring iGaming back to the US. State legislators and lawmakers worked together to break down the barriers to licensing and tech solutions required. Once New Jersey’s license was in place and the market went live, iGaming investments on Wall Street soared to an all-time high as other state governments began to formulate their bills to bring iGaming to their residents.