US Online Gambling Laws: State-by-State Payment Processing Guide 2025

The US online gambling landscape is a complex patchwork of state-by-state regulations. For operators seeking payment processing, understanding where gambling is legal—and what type—is essential for compliance and approval. This guide breaks down the current legal status and processing considerations for each regulated market.

The Current State of US Online Gambling

Since the 2018 Supreme Court ruling that struck down PASPA (Professional and Amateur Sports Protection Act), states have rapidly moved to legalize various forms of online gambling. However, regulations vary dramatically, affecting how payment processors evaluate applications.

States with Legal Online Casinos

Full online casino gambling (slots, table games, live dealer) is currently legal in these states:

New Jersey

Legal since: 2013 (first mover)
Regulator: New Jersey Division of Gaming Enforcement
Processing notes: Mature market with established banking relationships; easier processor approval
Key requirement: Must partner with Atlantic City casino license holder

Pennsylvania

Legal since: 2019
Regulator: Pennsylvania Gaming Control Board
Processing notes: Second-largest market; strong processor interest
Key requirement: Partnership with land-based casino required

Michigan

Legal since: 2021
Regulator: Michigan Gaming Control Board
Processing notes: Fast-growing market with tribal and commercial options
Key requirement: Commercial or tribal casino partnership

West Virginia

Legal since: 2020
Regulator: West Virginia Lottery Commission
Processing notes: Smaller market but favorable regulations
Key requirement: Land-based casino partnership

Connecticut

Legal since: 2021
Regulator: Connecticut Department of Consumer Protection
Processing notes: Limited to tribal operators
Key requirement: Tribal compact agreement

Delaware

Legal since: 2012
Regulator: Delaware Lottery
Processing notes: State-run monopoly; limited processing opportunities

States with Legal Sports Betting Only

These states permit sports betting but not online casino games:

New York: Mobile sports betting only (launched 2022)
Illinois: Online sports betting with in-person registration requirement removed
Colorado: Liberal licensing with competitive market
Arizona: Tribal and professional sports partnerships
Virginia: Growing market with multiple operators
Tennessee: Online-only model (no retail requirement)
Indiana, Iowa, New Hampshire, Oregon, Rhode Island: Various models

Payment Processing Considerations by Market Type

Tier 1 Markets (Easiest Approval)

New Jersey, Pennsylvania, Michigan—established regulatory frameworks, proven track records, and processor familiarity make these easier for approval.

Tier 2 Markets (Moderate Difficulty)

Newer legal states with developing infrastructure. Expect additional documentation requirements.

Multi-State Operations

Operating across multiple states requires:

Separate licensing in each jurisdiction
Geo-fencing technology compliance
State-specific player fund segregation
Multiple processor relationships may be beneficial

Documentation for State-Licensed Operations

When applying for payment processing, prepare:

State gaming license copies
Compliance officer credentials
Geo-location technology documentation
State-required responsible gambling implementations
Player fund segregation procedures
AML/KYC policies approved by state regulator

What's Coming Next

States actively considering online gambling legislation include:

New York: Online casino bills under consideration
Illinois: iGaming expansion discussions
Massachusetts: Post-sports betting, casino consideration
Maryland: Online casino legislation proposed

Expert Navigation

The state-by-state regulatory maze requires specialized knowledge. HighRiskChamps works with licensed operators across all legal US markets, connecting you with processors who understand jurisdiction-specific requirements.

Get State-Specific Processing Guidance