Why Do In-Person Gambling Laws Tend to Differ From Online Gambling Laws?

A brutal mix of political interest and economic value has determined gambling laws across the world. With societal attitudes changing rapidly, there has become a huge difference between land-based and in-person gambling laws and online legal frameworks. Whilst many countries and states have embraced in-person gambling, they remain hesitant about its online counterparts. 

The Rise of Online Gambling 

There are jurisdictions across the US and the world that have embraced the online gambling industry. There are currently 8 states across the US that have legalised online gambling, with online sports betting presently legal in 32 states. Many residents across the US and the globe have opted for the convenience and accessibility of online casinos. With developments in mobile technology, online gambling has never been easier. 

Players have switched from traditional brick-and-mortar establishments to fast payout online platforms. With so many options to choose from, avid players are looking for the highest paying casino that offers instant payouts, jackpot-rich slots, or low wagering bonuses. Casino expert Djordje Todorovic lays out how users can experience all of their favorite casino games online whilst also experiencing the social element of gambling right from their fingertips. 

The popularity of online gambling has led to a difference in gambling laws for online platforms in comparison to land-based casinos. Due to online gambling being such a new phenomenon that has grown rapidly over the last decade, lawmakers have been playing catch-up in a bid to find the best way to regulate the industry. It has, over recent years, disrupted traditional legal frameworks and regulatory models. 

When online gambling was first introduced, lawmakers didn’t have a clear understanding of how to regulate it. Traditional casinos operate from a specific jurisdiction, unlike online platforms, which can operate across borders and countries. This can make it more of a challenge for governments to oversee them effectively. As a result of this apprehension and lack of understanding of the new market, many ruling bodies chose to ban online gambling or to introduce heavy regulations to try to prevent any potential problems. 

Bricks-And-Mortar Casinos

When it comes to traditional casinos, lawmakers have had years to refine and regulate the industry. Traditional casinos have been around for centuries. With some parts of the world maintaining strict regulations on bricks-and-mortar casinos. However, these are often well-established frameworks. Historically, bricks-and-mortar casinos existed as a way to generate tourism and economic growth and generally received strict oversight in terms of regulations.  This has helped to create a more structured and regulated environment for traditional casinos over the years, where governments have more control. 

Traditional gaming revenue reached $71 billion in the US in 2024, which is a 7.5% increase in 2023 revenue. Traditional bricks-and-mortar casinos brought in almost $50 billion of this revenue. Due to these record numbers, many jurisdictions have created dedicated gambling commissions or regulatory bodies to oversee the industry. This is to ensure that casinos operate transparently and fairly. It also reinforces the traditional casino industry as a valued economic asset. 

Jurisdiction Challenges and Enforcement

One of the key reasons that the law differs between online gambling and in-person gambling is the inability to regulate online casinos across multiple jurisdictions. Globally, it has always been difficult to regulate digital platforms — as we can see from the blockchain and cryptocurrency boom. With traditional casinos operating in a physical environment, it is easier for governments to monitor their activities, enforce taxation, and ensure compliance with local laws. Regulatory bodies can do physical on-site audits and inspections, look at financial records, and impose penalties where needed. 

Online gambling platforms can not be monitored like traditional casinos. With many online casinos operating in offshore locations, this allows them to offer services globally across borders and countries. Even in places where online gambling is restricted, which creates a legal gray area. With governments unable to hold foreign operators accountable or restrict them to a legal framework. 

Whilst some governments have started to implement restrictions to combat this. For example, geo-blocking or restrictions on financial transactions. There is huge difficulty in implementing and managing this, and enforcing measures consistently remains a struggle. This contributes widely to the different legal treatment between online casinos and traditional brick-and-mortar.

Taxation and Economic Considerations 

A huge reason why so many governments have favored land-based casinos and tried to embrace online gambling is that both can be a lucrative source of income for governments.  A report by Vixio suggests that if online casino gaming were legalized in all states with existing land-based casinos or sports betting, it could generate up to $15 billion in annual tax revenue for state and tribal governments.

Online gambling does contribute significantly to revenue generation, especially over recent years, however, it presents lawmakers with a different economic model. Generally, online casinos will provide less to local economies as they do not require a physical presence, and there is less local job creation. This has meant that some lawmakers and regulators favor traditional casinos more due to their direct impact on local economic growth. 

Key Takeaways: 

• Legal frameworks and gambling laws around traditional casinos are significantly more established due to the long history surrounding land-based casinos. Governments have had more time to understand the industry and refine regulatory frameworks. 
• Gambling laws and regulations have had to evolve rapidly over the last decade in line with digital advancements, with lawmakers constantly having to catch up with the industry. 
• Online platforms working across jurisdictions and countries make it significantly harder for lawmakers to regulate the market and enforce any gambling protection measures.
• Laws and regulations around the gambling industry are often influenced by the pursuit of economic growth and local job creation, with traditional casinos offering a more direct contribution to local economies.