A predicted “hands off” approach to federal gaming regulations from the incoming Trump Administration will benefit the industry overall, according to an executive from a major national online gaming operator.
U.S. President-elect Donald Trump will largely avoid federal gaming policy in his second administration, said Rush Street Interactive CEO Richard Schwartz Monday. Speaking during Monday’s Needham Consumer Tech and Ecommerce Virtual Conference, Schwartz said Trump will support efforts for new gaming avenues, particularly around online casinos.
“I think it's always helpful to have a president who is not opposed to gaming expansion, which is the case with President-Elect Trump,” Schwartz said.
Industry supports state-level approach
Schwartz echoed many of his colleagues' support for the current state-by-state level approach to legalization and regulation, eschewing federal proposals. He said Trump will allow this system to continue and won’t push any significant nationwide changes.
This includes a proposal by Democrats in both the House and Senate for a sweeping sports betting bill that would restrict advertising and require sportsbook licensing certification from the Attorney General’s office. With Republicans controlling both houses of Congress and the White House, Schwartz said the bill has little potential to pass.
Without federal legislation, Schwartz said this will allow more states to pass online casino gaming. These offerings have only been approved in a handful of states but are far more lucrative for gaming operators – and state tax coffers.
Real money iCasinos, legal in seven states, generated $2 billion in operator revenue in the third quarter of 2023. Sports betting was legal in 38 states and generated $3.2 billion in revenue during that same time.
This potential for licensed online casino operators will become more apparent in 2025 when state legislatures reconvene and can address the proliferation of largely unregulated social and sweepstakes casinos, Schwartz said. The additional silver lining is the existence of these social casino sites means there is a clear argument for real money casino legalization.
“I think that’s a great reason to jump-start even more efforts on iCasino,” Schwartz said.
“Plus, the fact we know that when an iCasino is added to a state with legal sports betting, about three-quarters of the taxes comes from iCasino verses sportsbooks, so it’s a very profitable way to raise taxes.”
Fears dissipate from first administration
The bullish sentiment in the second Trump term comes after his Justice Department pushed a suit that threatened the online gambling industry’s existence.
During Trump’s first administration, the Attorney General’s office determined the Wire Act of 1961 expanded beyond just sports betting, which had been the prior interpretation of the Obama Administration. This ruling threatened online lotteries, poker, and online casino gaming.
Attorneys general in multiple states challenged it in court, with a judge ruling in 2021 that the original interpretation limited the Wire Act to intrastate sportsbooks. Industry stakeholders speculated the challenge was pushed by Las Vegas Sands founder Sheldon Adelson, one of Trump’s biggest donors and arguably the nation’s most outspoken online gambling opponents.
Adelson’s widow Miriam maintains control of Las Vegas Sands but has not been as public an online gaming adversary. Since Sheldon Adelson died in 2021, Sands has divested itself of all U.S. assets. Unlike most of its other American-based competitors, the company has not pursued an online sportsbook or iCasino platform.
Miriam Adelson is now focused on a Texas destination resort casino. She purchased the NBA’s Dallas Mavericks in 2023, in part to have them play games in a future stadium at the casino property in the Dallas metroplex.
👀👀 Texas gambling isn't a matter of if but when, Caesars New Orleans GM Samir Mowad said today during a legislative hearing on a Louisiana sports betting tax increase bill; Louisiana would be one of the states most impacted by Texas casino and/or sports betting legalization
— Ryan Butler (@ButlerBets) November 13, 2024
She is expected to push lawmakers in Austin to advance the state’s first-ever commercial casino. This, in part, will take away some of her attention from Washington, D.C., according to those familiar with Trump.
In an interview with Covers earlier this month, former Trump advisor Sam Nunberg said that while Adelson may have sway in the incoming administration on the heels of her millions in campaign contributions, he does not expect that to influence gambling policy. Nunberg said that “the cat’s out of the bag” when it comes to online sports betting (approved in 39 states) and online casino gaming (approved in seven states).
“There will never be a federal ban,” Nunberg said. “The states are getting too much revenue from it.”
