Crypto-currency online casinos and poker sites are the businesses most likely to benefit from the U.S. Justice Department’s decision to ban interstate online gambling. The DOJ’s opinion, which reversed a 2011 opinion on the Wire Act and the UIGEA, was announced on Monday of this week.

On Tuesday, Rod Rosenstein announced the decision would go into effect in 90 days. Before that time is up, gaming experts believe operators and US states will launch a flurry of lawsuits to challenge the policy.

Gaming operators like 888 Poker have invested a lot of money in state-regulated US online gambling. Their shareholders have invested assuming interstate online poker would be legal.

Meanwhile, individual states have legalized online gambling in order to generate new tax revenues. Some will file suit to protect their tax revenues. Others will challenge the law based upon states’ rights. American conservatives long have held the US federal government should not have power over such decisions.

Office of Legal Counsel

Still, the law could stand for years — just like a decision made during Eric Holder’s time as Attorney General held for 8 years. On Monday, the Office of Legal Counsel (OLC) revised the 2011 DOJ opinion which stated that the 1961 Wire Act applied only to sports betting. From 2007 to 2011, the US government enforced an online gambling ban on sports betting, casino gaming, and poker, but then-Assistant Attorney General Virginia A. Seitz exempted the latter two forms of online gambling back in 2011.

The Multi-State Internet Gambling Association (MSIGA), which linked poker play from Nevada, Delaware, and New Jersey will be illegal after the 2019 DOJ opinion. Other forms of interactive gaming might be targeted by the Justice Department, which puts the industry in doubt throughout the United States. Only Delaware, New Jersey, and Nevada have legal single-state online gambling at the moment (Pennsylvania will follow soon).

That leaves US online gamblers with a single way to play for real money: sign up with an unregulated offshore online casinos or card room. Of those sites, those which use crypto-currencies like Bitcoin, Litecoin, Ethereum, and Dash are the safest.

Simulcasting and Online Racebook Bets

Established gambling operators are asserting their right to continue unimpeded. For instance, Alex Waldrop, the National Thoroughbred Racing Association’s chief executive, pointed out that a 1978 law protects pari-mutuel wagers from federal oversight under the terms of the 1961 Wire Act.

The Interstate Horseracing Act of 1978, which established simulcasting at race tracks and off-track betting facilities (OTBs), exempted pari-mutuel bets on horse racing, dog racing, and harness racing from Wire Act prosecutions. Even the horse racing industry is concerned about the new DOJ policy, because it could scare banks and other financial institutions. When a person tries to use a credit card to pay for horse betting, they might find the card declining more often.

Waldrop told the Paulick Report the NTRA “will be working with allies on the [Capitol] Hill to assure banks and credit card processors that it is still legal to allow their credit cards to be used to fund [advance deposit wagering] accounts.”

Are Crypto-Currency Online Casinos Better?

Everyone else is left to deal with a whole new reality. That is why crypto-currencies might benefit the most from the online gambling ban. Payments using Bitcoin, Litecoin, Ethereum, or Dash are available to online gamblers — and they’re often the safest option.

The reason for the added safety is the combination of transparency and anonimity virtual currencies offer. That might seem paradoxical, but all transactions using Bitcoin or its less famous crypto-currencies are added to its respective blockchain. Every transfer of cash is completely transparent to the whole world.

Also, those transactions have unique codes, so any transfer of cash means a user has an entirely new code. That makes the transfer impossible for identity thieves to steal — the code is changed by the time they would break it.

At the same time, the use of passwords and not usernames or banking information means the transfer also is anonymous — or at least much more private than otherwise would happen. This allows online casinos and poker rooms to send payments quickly without the usual verification process. Crypto-currency payments often reach a Bitcoin wallet within 15 minutes — and seldom more than 2 hours elapse before money is liquid.

Offshore Online Operators

Even the term “unlicensed” or “unregulated” often is inaccurate when describing offshore online gaming sites. What that means is that no US agency has licensed or regulated the sites. Often, the operators gain licensing from another government’s regulator, including Curacao, Panama, or Costa Rica — though Kahnawake in Canada no longer licenses sites which sign up US players. Further afield, sites gain licensing from Gibraltar or Malta.

About the Author
April Bergman avatar
April Bergman

April Bergman was a longtime news blogger for BOC. She wrote gaming news posts from January 2013 until September 2018. April also wrote slot reviews, strategy articles, and online casino reviews for the site.

April Bergman began in the online gaming industry in August 2010. From 2010 to 2013, she managed evergreen content for several top online casino. Her duties included developing and maintaining multiple websites in the gaming space. When not writing about online gambling, April loves horse racing, travel, photography, and gardening. She's began in the business as a devoted poker players and spent several years as a card game editor on the now-defunct DMOZ. These days, she lives with her husband and two children in the Toronto metropolitan area.

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April Bergman was a longtime news blogger for BOC. She wrote gaming news posts from January 2013 until September 2018. April also wrote slot reviews, strategy articles, and online casino reviews for the site.

April Bergman began in the online gaming industry in August 2010. From 2010 to 2013, she managed evergreen content for several top online casino. Her duties included developing and maintaining multiple websites in the gaming space. When not writing about online gambling, April loves horse racing, travel, photography, and gardening. She's began in the business as a devoted poker players and spent several years as a card game editor on the now-defunct DMOZ. These days, she lives with her husband and two children in the Toronto metropolitan area.

READ MORE
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