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US iGaming Has a Lot of Potential, AGA Says


The latest State of the States report by the American Gaming Association (AGA) shows how the various gambling verticals fared in 2021.

IGaming Is the Most Profitable Vertical

The report showed that iGaming is easily the fastest-growing form of gambling. As of now, only the states of Connecticut, Delaware, Michigan, New Jersey, Pennsylvania and West Virginia have legalized online casinos. Despite iGaming being legal in only six states, its revenues were 86% of what sports betting earned. For reference, iGaming in the USA had annual gross gaming revenue of $3.71 billion while sportsbooks earned $4.33 billion.

Sports betting and its mobile form are quickly reaching new markets as more and more jurisdictions seek to legalize the vertical. By the end of December 31, there were 30 states besides DC where some form of wagering on sports was legal. However, sports betting’s fast expansion is barely enough to keep it ahead of the profitable iGaming market.

Many attribute the rise of iGaming to the COVID-19 pandemic, which forced countless casinos to close or operate under strict measures. Yet, even now that the restrictions have been lifted, iGaming maintains its leading position. This will likely influence certain states to consider the legalization of iGaming, analysts claim.

IGaming Tax May Boost Local Economies

It is also worth noting that iGaming has a lot of potential benefits as well. The states that allow online gambling usually impose high tax rates on it. For example, New Jersey requires retail sportsbooks to pay only 9.75% of their revenues as tax. Meanwhile, it requires mobile sports betting and iGaming to give 14.25% and 15% of their revenues respectively. Pennsylvania, on the other hand, requires online slots to share a whopping 54% of their income. These numbers mean that online casino games have a huge potential to contribute to local economies.

Although iGaming seems to hold the highest potential of all forms of gambling, 2021 was a record year for the industry as a whole. Numerous states posted all-time-high revenues, leading to total industry-wide revenue of $53 billion.

This growth tendency seems to continue in 2022. The AGA believes that US gambling may be preparing for a second record year. Bill Miller, the chief executive officer of the AGA, shared his thought on the matter:

Although 2021 was a tumultuous year, I’m confident it set a new baseline for gaming in the long-term as we provide consumers with cutting-edge entertainment and anticipate the full recovery of travel, events, and entertainment.

Bill Miller, CEO, AGA

Entering 2022, more states seek to legalize additional forms of gambling. In California, the fight to legalize online sports betting continues.

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