From about 2001 to 2006 the online gambling industry was booming. Players could easily deposit with Paypal, credit cards, or using the online wallet NETeller. Money was flowing everywhere, and the Internet casinos were making a killing, especially off of players from the United States. However, recent actions by the U.S. government have put a hold on that, and cut off a lot of the players from the United States.
In late 2006 Congress passed a bill called the Unlawful Internet Gambling Enforcement Act (UIGEA for short) that was an attempt to shut down online gambling for players in the United States. Instead of targeting actual players, the government targeted the banks that processed transactions for the gamblers. It became illegal to process payments related to online gambling, so no banks would send money to NETeller. Also, previous to this Paypal had dropped out of the e-gaming market, so players couldn’t use them either.
Credit Cards also no longer worked, because the credit card companies are in the United States so they were forced to stop processing payments from US players. This left players with basically no options for depositing money onto a casino website. A few other e-wallets entered the market including Click2Pay and ePassporte, but they never caught on with the fire that NETeller once had.
One hang up though is the fact that many online casinos will no longer allow players from the USA, because they want to comply with the USA’s demands. Places like Casino Tropez have dropped out of the US market, so players haven’t been able to return even after they found a deposit option.
However, casino rules new options have surfaced that now allow USA players to play at the best casinos. Credit card payments have returned at many online casinos and poker rooms, and other methods such as e-check payments have allowed most players to return to their previous sites.
The overall effect of this is that about 60% of the USA player market has dropped out, because the casual player doesn’t want to jump through loops just to make a deposit at an online casino. This crippled many online casinos, and evidence of this is the image of PartyGaming’s stock prices on the day that the UIGEA was passed. For those of you who haven’t seen it, basically the stock went from a high soaring price to pennies within hours.