The heydays of the early 2000s represented a time when poker players from all over the US were still able to openly participate in their pastime online. All of that would eventually change, however, with the US introducing legislation to outlaw online gambling. Around the same time, PayPal chose to cease its involvement with the US online gambling industry in 2003, scared off by legislative change and a merger with eBay.
Some 12 years later and PayPal has quietly reversed its policy regarding the US online gambling industry. A couple of weeks into September, gambling media outlets began to break the news that PayPal was to be accepted at the US sites for the World Series of Poker (WSOP) and Derby Games. US customers can now use PayPal at those casinos plus a number of others.
Although PayPal has been out of the US online gambling industry for some years, the payment provider has remained incredibly active in Europe, where online gambling is widely legal and extremely popular among customers. Back in 2003, PayPal was actually the most utilised payment method among US online gamblers. Unfortunately for PayPal, however, the company’s domestic industry was culled by legislative change.
Questioning PayPal’s decision to leave the US online gambling industry just doesn’t make sense, given how you cannot keep making legitimate revenue if all of the sites have been deemed to be illegal. Now, though, everything has changed, as there is a legitimate online gambling industry once again, following legalisation in Nevada, New Jersey, and Delaware.
But despite PayPal deciding to legally re-enter a bona fide industry, analysts are curious as to why their return has barely been spoken of. One such person is former Wall Street trader and poker world champion Andy Frankenberger, who believes that PayPal is concerned for its reputation. The reason for this rationale is that online gambling is still viewed as being a potential grey area, given how many politicians are seeking to close the legal US markets.
Having been contacted by a leading US media outlet, PayPal was forced to release a statement to clarify its activities. For the moment, PayPal is only working with US three online gambling sites as part of a pilot programme. PayPal has an extensive list of US gambling activities that it has banned, but the four approved sites are not subject to the prohibited list of gambling activities.
To add some perspective, there are 50 states in the continental US. The three states where online gambling is legal account for a mere 6% of the country. Without all of the states legalising online gambling, Frankenberger believes that those opposed will always view that activity as being illegal and immoral.
Currently, it could be argued that online gambling operators are being treated somewhat unfairly compared to fantasy sports websites that technically offer gambling services throughout much of the country. PayPal has been working with fantasy sports sites for years now, helping them to accept entry fees from players before later paying out cash prizes based on outcomes that can be determined by chance.