History of U.S Multi-State Online Poker & The MSIGA

by Jenny Tang - Wednesday, May 25th, 2022 9:54


interstate poker in the USA

There was a time when the whole world was a single, global market for online poker.

The very first real money online poker hand was dealt in 1st January 1998 – dealt by the now defunct Planet Poker brand – the first online site offering real-money poker on the internet.

Sites like Planet Poker, Paradise Poker and later PartyPoker, Full-Tilt, PokerStars, Bodog and Absolute Poker attracted players from hundreds of countries – making billions of dollars in rake during the poker boom years.

In the years that followed, global governments passed laws and created regulators to manage and administer legal, fair and safe iGaming in their territories – and the whole online-poker eco system was changed forever.

Many countries still have access to a shared global poker player pool, but not the US.

Gambling laws are complicated, varied and fragmented in the US  – with each state responsible for laying down the law, in the literal sense – for gambling activities in their respective state. Currently in 2022 online poker is legal and regulated in 7 states.

maintaining a critical-mass of players and liquidity can be a challenge for smaller states

Keeping a good selection of poker games going (enough cash-games, SNGs and tournaments to keep customers satisfied) 24/7 can be challenging for states with smaller populations, due to the constraints of only being able to accept customers from within state lines. If players cannot find teh action they expect – they may go play on international poker sites – resulting in no revenues for the state, and little to no protections for consumers.

One solution to the problem is to enable states with legal poker to share players (and the liquidity they bring) across their software networks so that players can always get a game – and so that the online card-rooms can viably run large field tournaments (with big prize-pools, due to more participants) – enter the Multi State Internet Gaming Agreement (MSIGA).

USA Legal Poker History & the Multi State Poker Agreement

The MSIGA is  a multi-jurisdictional poker agreement allowing internet gamblers to compete across state lines

2012: Online Poker Legal and Regulated in Delaware and Nevada.

In 2012, Delaware became the first state to legalize online poker, and Nevada soon after. The two markets got their start on their own.

But the state’s governors agreed to share online poker liquidity in a contract that was inked in March 2015. The location of the players would determine how much state income would be retained, but everyone would participate in the same pool. In the US, the Multi-State Internet Gaming Agreement was a first.

Although it had little impact on either state’s revenue, it did lay the groundwork for future interstate growth.

Multi-State Internet Gaming Agreement

The state of Delaware positioned itself as a hub for interstate gaming during the legislative process. A state with fewer than a million citizens was always going to need to collaborate with other states. The Multi-State Internet Gaming Association was founded in Delaware as part of the deal with Nevada.

A unified set of regulations and their governance structure were developed by the MSIGA. It is open to joining states, and each one receives a seat on the board of the organization.

2017: New Jersey Wants Access To Global Poker Market

NJ had legalized online gambling back 2013. Roll on to November 2017 where Sen. Raymond Lesniak sponsored a bill which could have opened the door for more agreements to be made across international borders.

Lesniak aimed to repeal the portion of New Jersey’s gaming code that requires servers to be located in Atlantic City. The state would be able to collaborate with out-of-state and foreign operators if that obstacle were to be removed. In essence, it might reopen the world to New Jersey gamers of online poker. Lesniak left office at the conclusion of the 2017 legislative year without getting the bill any further.

2017: Pennsylvania Becomes 4th state to legalize online poker

The Keystone State became the fourth to legalize online poker in 2017, but PA has not made any moves towards joining a compact (which would surely add huge equity to the US online poker eco-system – due to having a large population (12.79 million people, 2020).

2019: West Virginia & Michigan Legalize Online Poker

In 2019, West Virginia and Michigan became states number five and six, respectively, to legalize online poker. West Virginia did so in late March, and Michigan in December.

January 2021 saw PokerStars enter the legal online poker market, followed by BetMGM in March. on 23rd of May 2022, Michigan joined the MSIGA

The Michigan Legislature in December 2020 passed a bill to allow the Michigan Gaming Control Board (MGCB) to join a multi-jurisdictional poker compact, giving Michigan residents the ability to compete with poker players in other states.

Sen. Curtis Hertel (D-East Lansing) sponsored the bill (now PA 327 of 2020), which was signed by Gov. Gretchen Whitmer on Dec. 29, 2020. Language allowing multi-jurisdictional play was omitted from the original internet gaming law signed in December 2019 (PA 152 of 2019). The 2021 Michigan law limits multi-jurisdictional internet gaming play to only poker.

2021: Connecticut Legalizes poker

Along with online casinos and sportsbooks, Connecticut legalized  online poker in the first half of 2021 – becoming the sixth state to do so. As of June 2022, legal online poker has not been brought to the masses- and it’s not clear if the state will join the MSIGA or even provide online poker. Of the two gambling operators permitted to operate in the state (FanDuel and Draftkings) neither operation has a poker product (but of course FanDuel is currently owned by Flutter entertainment – owners of the PokerStars brand – and maye introduce a poker product using rational software technology. DraftKings is rumored to be developing a poker product.

 

Jenny Tang

iGaming journalist living in NYC with her two dogs, "button" and one-eyed "big-blind".