The recent Interstate Compact and the ability to share liquidity between states has a lot of people wondering where this will lead. In particular, they are wondering how it might play out in land-based casinos that have had trouble with so many uncollectable coin transactions occurring.
On Wednesday, the long-awaited day for many online poker players came. The Multi-State Internet Gaming Agreement has been expanded by gaming regulators in Nevada, New Jersey, Delaware, and Michigan (MSIGA).
The agreement adds the Wolverine State to the country’s online gambling interstate compact, clearing the path for pooled liquidity.
“The Multi-State Internet Gaming Association welcomes Michigan to its ranks, along with its nearly 10 million residents, who can now take advantage of a full range of interactive gaming across the association’s member states,” said Rebecca Satterfield, manager of the association and Internet gaming manager for the Delaware Lottery.
“The Association remains forward-thinking, and we welcome other gaming countries’ interest in joining the agreement.”
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Negotiating an agreement
The agreement adds one state to the existing interstate compact, but Satterfield’s words suggest that more might be on the way. Currently, Pennsylvania operates in a “ringed-in” setting, which means that players compete exclusively against other residents of the state.
West Virginia and Connecticut have also authorized online poker, but no operators have yet to open their doors. By including such jurisdictions in the pact, they may become more viable poker markets. With their inclusion in the compact, poker operators will have access to even more players and prize pools.
For the last year, gaming authorities have been working on the agreement. Officials from Michigan just needed to sign a few paperwork, which were anticipated to be completed in a few days.
According to Michael Morton, senior policy counsel at the Nevada Gaming Control Board, online poker companies may shortly begin grouping player pools in any of the states.
“As soon as Michigan signs a handful of paperwork, they’ll be able to do it legally,” he added. “At that point, if the operators do not already have the necessary permits in Michigan, it will be up to them to get them.”
The state looks to be ready to launch, having just established its own interstate poker standards. Morton anticipates that document signing will take place shortly, enabling operators to establish their shared liquidity markets.
So, how does this affect poker players?
WSOP.com presently operates in the only shared liquidity environment in the United States, alongside 888poker, in Nevada, New Jersey, and Delaware. In addition, the firm just opened in Michigan. As a result of the deal, the firm is now eligible to join all four states.
Borgata Poker and BetMGM are Partypoker US Network skins that operate in Michigan and New Jersey, respectively. PokerStars is also present in both states. As a result of the agreement, parties and Stars may be able to launch shared liquidity across the two states.
“An operator is not required to operate in every state that is a party to the agreement,” Morton said. “They have the ability to work in two or more.”
Interstate compacts boost player pools while also lowering expenses for operators. This contributes to the viability of the US markets. Morton would not say whether or not talks with Pennsylvania or other states are in the works.
An examination of market sizes
The addition of Michigan to the Multi-State Internet Gaming Agreement offers it a considerable boost. The overall population of all four states is about 23 million, and the following is a breakdown of each state’s population:
With the All American Poker Network, WSOP.com would have the biggest of the three US operators. Stars and online party participants would benefit as well. Here’s a look at the three companies and the states where their networks can be useful.
- All American Poker Network (WSOP/888poker) – 23 million (Nevada, New Jersey, Delaware, Michigan)
- 18.9 million on the Partypoker US Network, which includes BetMGM and Borgata Poker skins (New Jersey, Michigan)
- PokerStars USA has a total prize pool of $18.9 million (New Jersey, Michigan)
The deal might result in the biggest player pools seen in the United States since Black Friday. Adding Pennsylvania’s 12.8 million people to the mix would significantly increase the size of the player pool.
Making the market in the United States viable
Operators also anticipate that the larger player pools and reward pools would entice even more people to join the authorized markets.
partyBetMGM director of poker Luke Staudenmaier remarked, “BetMGM applauds MSIGA for bringing Michigan into the consortium.” “Shared liquidity is critical for online poker’s development, and this is a significant move in the right way.” We are dedicated to extending BetMGM’s poker product in the future, and we look forward to servicing pooled player pools.”
Several online poker players talked with USPoker in February about the market’s potential with interstate compacts. Darren Elias, a four-time World Poker Tour winner and partypoker/BetMGM ambassador, sees tremendous things coming for his firm, which he says will be ready to move forward fast with connecting player pools.
“I believe that online poker in the United States has huge potential,” he stated. “Players want to come back online and play in safe, regulated markets, but we’re still constrained by ring-fenced regulation for the time being.”
“The player pool will quickly rise as additional states are permitted and interstate compacts are finally created.” I’m now working with BetMGM to create the groundwork and prepare for the expansion when it arrives. I anticipate that online poker will once again be a prominent business in the United States, with BetMGM leading the push.”
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— March 30, 2022, US Poker (@uspoker)
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Ring games, tournaments, and SNGs in Texas Hold’em
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Background information about the deal
The MSIGA agreement was first signed in 2014 between Nevada and Delaware. In 2017, New Jersey became a member of the agreement, increasing the association’s pooled liquidity to include full online casino games.
The group, which is based in Delaware, oversees the activities of its members. Member states may already play online poker in Michigan and Nevada, while Delaware and New Jersey provide a complete range of online gambling.
The Trump administration maintained that interstate compacts violated the Wire Act, which hindered their expansion for years. Only WSOP.com is still functioning in a multi-state environment as a result of the legal efforts.
States, on the other hand, maintained that the Wire Act only extended to sports betting, and the New Hampshire Lottery filed an appeal. A federal appeals court sided with the casino industry in 2021. The Biden administration decided against taking the case any further.
More interstate compacts are now possible, as seen by the expansion announced on Wednesday. Gaming authorities, like many poker players, appeared delighted to see some progress on the problem.
“From the regulator’s perspective, this is a true thing,” Morton said when the deal was announced. “However, economics isn’t something we’re unfamiliar with.” Obviously, the more the liquidity accessible, the better.”
