This November marked a significant milestone in the gaming industry, commemorating the 10-year anniversary of the launch of legal online casino gaming in the U.S.
The inception of iGaming in Delaware and New Jersey in November 2013 launched the era of regulated iGaming in America. Over the past decade, this industry has evolved and thrived, reaching new heights and reshaping the landscape of American gaming.
In the 10 years since its inception, legal online casino gaming has expanded to include Connecticut, Michigan, Pennsylvania and West Virginia, while the sector has become a significant factor in the broader gaming industry’s run of 31 consecutive months of annual revenue growth.
Remarkably, nationwide iGaming revenue has seen year-over-year expansion every month since November 2013. The industry is poised for another record year in 2023 with year-to-date revenue standing at $4.49 billion, a robust 23.8 percent increase over the same period last year.
How has the American iGaming market evolved since its inception? Here are four numbers that tell the story.
$16.3 Billion – A Decade of Economic Impact
Since November 2013, the six full-scale iGaming markets in America have collectively generated a staggering $16.3 billion in online casino revenue. Leading the pack is New Jersey, boasting $6.91 billion, followed by Pennsylvania ($4.3 billion) and Michigan ($4.1 billion).
While iGaming’s growth in the U.S. started out slow and gradual, it was accelerated by the unforeseen catalyst of the Covid-19 pandemic. In 2020, U.S. iGaming revenue tripled from the year prior, with New Jersey, Pennsylvania and Michigan swiftly accelerating to billion-dollar markets. Despite the challenges faced by the gaming industry that year, iGaming emerged as a resilient and essential component of its revenue stream.
$4.05 Billion – A Fiscal Powerhouse
Despite only being legal in six states and available to less than 13 percent of adults in their home states, the legalization of iGaming has translated into $4.05 billion in state and local taxes in its 10 years of U.S. operations. The substantial fiscal contribution of iGaming to state, local and tribal governments underscores iGaming as a fiscal powerhouse for communities where it has been legalized.
865% – Narrowing the Transatlantic Gap
As American iGaming has matured, it has steadily gained ground on its European counterparts. While iGaming revenue across the E.U. and the U.K. increased by an impressive 48 percent between 2019 and 2022, the U.S. market witnessed an extraordinary 865 percent growth over the same period.
$338 Billion – The Shadow of The Illegal Market
Despite the growth of legal markets over the last 10 years, iGaming thrives predominantly in an illegal and unregulated landscape. American Gaming Association research shows the illegal iGaming market was nearly three times the size of the regulated iGaming market in 2022, resulting in an estimated $3.9 billion loss in state taxes that could otherwise support communities if captured by the regulated market.
As we reflect on the past 10 years, it’s not clear what the future holds for iGaming in the U.S. However, one thing is certain: The sector continues to gain popularity in existing markets, providing not only a source of tax and gaming revenue but also a safe, legal alternative to the predatory illegal market.