Is cryptocurrency the key to legalizing online poker in all U.S. states?
Published by: Jon SofenPosted on: March 23, 2021 9:28 pm EDT
There’s a decent chance that the increase in cryptocurrency popularity could help make online poker legal nationwide.
Before we explain our reasoning, it’s important we explain the current situation for online gambling in the United States. As of March 2021, there are only five states with licensed and regulated poker sites in operation (Delaware, Michigan, Nevada, New Jersey, and Pennsylvania). Michigan joined the party in 2021 and is off to a strong start.
There are also some unregulated sites operating in most states. On April 15, 2011, the U.S. Department of Justice cracked down on all the major poker sites (i.e. PokerStars and Full Tilt Poker) that were operating in the U.S. illegally. As such, the sites were shut down in America.
Since then, it’s been a long and mostly unsuccessful fight to legalize online poker, and gambling in general, nationwide. But there have been some successes along the way, including the aforementioned five states legalizing internet gambling. The remaining 45 states, well, that’s a different story.
However, brighter days might be on the horizon for poker enthusiasts, perhaps in large part due to the increased popularity and trustworthiness of cryptocurrency such as Bitcoin.
Easy account funding
Cryptocurrency is becoming a common way to fund an online poker account, including at U.S.-facing poker sites such as Americas Cardroom. Bitcoin and other forms of cryptocurrency aren’t purchased through a bank, and that is one main reason why the new-ish form of currency just might be the gateway to nationwide online poker legalization.
The Interstate Wire Act of 1961 prevents gambling sites from legally accepting online wagers outside of certain jurisdictions. As a result, it is technically illegal for a bank to process online gambling transactions outside of states that have legal poker sites in operation.
That is where Bitcoin and other forms of crypto come into play. You don’t purchase Bitcoin from your local bank. It is acquired through a cryptocurrency exchange or an app such as Cash App. After purchasing Bitcoin, you would then transfer those funds directly into your online poker account.
The benefit here is that banks aren’t involved in the transfer of funds between the cryptocurrency to the poker site, and vice versa.
More widely accepted
A few years back, and heck even at some points in 2020, Bitcoin and cryptocurrency in general was seen as a fad. Many investment experts said it would just fade away and those who invested would end up losing all their money. That doesn’t appear to be the case.
In March 2021, on Bitcoin reached $60,000, up more than $50,000 compared to the same month in 2020. In December 2017, it hit $20,000 for the first time before plunging to well under $10,000 for much of the next few years.
But the virtual coin has become more stable, and more big investors such as Tesla are on board. As a result, the coin, and cryptocurrency in general, is now considered a legitimate mainstream investment. At this point, it’s become a more reliable investment vehicle than the stock market, especially during COVID-19.
What’s that all mean for online poker in the U.S.? If cryptocurrency becomes the main form of funding an online poker account like it is at sites such as Americas Cardroom, there’s a reasonable chance politicians who have long opposed legal internet gambling may be willing to rethink their positions.
Of course, there are no guarantees and we can’t get inside the minds of any politician, especially the corrupt ones. But if the banks are bypassed when funding an online poker account, there’s certainly a chance lawmakers who would otherwise oppose legal online poker will at least consider supporting a change.
What’s the goal?
Ever since Black Friday in 2011, the online poker industry has been lacking. Sure, there are some available sites out there that many enjoy. But it just hasn’t been the same as it was during the poker boom era.
Part of online poker’s decline is due to many of the recreational players quit playing online following Black Friday. But that would likely change if online poker became legal nationwide as more players would feel comfortable signing up for a poker site.
The ultimate goal for the poker industry is for the U.S. to pass legislation permitting poker sites in all 50 states to begin operation. What that would mean to the industry as a whole is immeasurable.
The United States has over 340 million citizens and is home to most of the top major poker events, including the World Series of Poker in Las Vegas. And four of the top five winningest live tournament players of all-time (Bryn Kenney, Justin Bonomo, Erik Seidel, and Dan Smith) are Americans.
Although poker is an international game with many great players and exciting events outside the U.S., when Black Friday struck in 2011, the game of poker took a massive hit in terms of popularity. If online poker were to become legal nationwide, we could see another poker boom similar to one in the early 2000s. And, perhaps, this time it will be sparked by the growth of cryptocurrency instead of Chris Moneymaker.
Featured image source: Flickr