expands post-PASPA gambling industry challenges regulators, who can adapt through technology adoption
In the wake of the Professional and Amateur Sports Protection Act (PASPA) being repealed in 2018, gaming regulators in the United States have faced a series of challenges. The fragmented state-by-state regulation, rapid technological changes, and managing risks associated with online gambling expansion have tested their abilities to keep up with the evolving industry.
One of the key challenges is the fragmented state-by-state regulation, which has resulted in a patchwork of laws differing by state regarding licensing, tax rates, product offerings, and access controls. This complexity creates difficulties for regulators overseeing operators and consumers who may cross jurisdictional lines.
Another challenge is the rapid market expansion and legal ambiguity. The swift legalization in 39 states plus D.C. by 2025 has stretched regulatory resources and raised questions about enforcement consistency. Handling new forms of betting like online sportsbooks and iGaming, which remain illegal or highly restricted in some states, has become a pressing issue.
Regulators have had to keep pace with evolving digital platforms that facilitate online gambling. These digital environments require continuous technological monitoring to ensure compliance, fairness, and fraud prevention. To manage payments and financial flows in the complex landscape, some regulators employ transaction waivers that allow certain financial transactions related to gambling to bypass common banking restrictions, facilitating smoother operations while maintaining oversight.
Another crucial element regulators need to consider is the omnipresence of artificial intelligence (AI) in the gaming industry. AI tools are being integrated to analyze large datasets from betting activities, predict suspicious patterns, automate reporting, and augment decision-making processes for licensing and enforcement activities. AI also supports customer protection by identifying risky gambling behavior early.
Regulators continue evolving their frameworks in response to this dynamic landscape, drawing lessons from international iGaming regulation models both in Europe and North America. Despite progress, challenges such as varying state tax policies, resistance in some states to expanding online gambling, and balancing growth with integrity remain at the forefront.
The need for collaboration between stakeholders, including regulators, lawmakers, and the industry, has been highlighted by experts such as Dan Hartman, former director of the Colorado Division of Gaming. Hartman emphasized the importance of being open-minded and including the industry's opinions in making revisions to benefit them.
In conclusion, post-PASPA gaming regulators in the U.S. confront a complex, decentralized regulatory framework and fast-moving technological trends. They adapt through the selective use of transaction waivers, technology deployment, and AI integration to enhance their regulatory effectiveness and address emerging risks. The webinar "State of Gaming Licensing: What's Changed Since PASPA And What's Next?" hosted by Jonathan Michaels and presented by Speridian Technologies, provides a valuable platform for discussions on these issues and the future of gaming regulation in the United States.
[1] https://www.gamingtoday.com/news/sports-betting/2018/05/14/sports-betting-post-paspa-what-happens-next/ [2] https://www.forbes.com/sites/michaelcaselli/2021/01/27/how-the-us-gaming-industry-is-adapting-to-the-post-paspa-era/?sh=7a864c9e5c34 [3] https://www.gamingtoday.com/news/sports-betting/2020/09/22/california-online-sports-betting-still-a-long-shot/ [4] https://www.forbes.com/sites/michaelcaselli/2021/01/27/how-the-us-gaming-industry-is-adapting-to-the-post-paspa-era/?sh=7a864c9e5c34 [5] https://www.speridian.com/blog/artificial-intelligence-in-gaming-regulation/
Regulators are grappling with the fragmented state-by-state regulations that have created a complex web of laws and policies, making it difficult to manage operators and consumers who cross jurisdictional lines.
The rapid expansion of the sports betting market, precipitated by the legalization in multiple states, has strained regulatory resources and raised questions about enforcement consistency.
