Online Gambling A Confusing Legal Line

After the huge crackdown of internet-based poker in 2011, the online gambling world is slowly making a comeback!

The road to change is still quite murky, each state has their own rules and they are dependent on specific legal definition of what gambling and betting is.

At this time there are 37 USA states that allow betting on games, the gaming must have some degree of ‘skill’ attached to it to be acceptable. Recently three states Delaware, Nevada and New Jersey, have actually legalized games of chance, which under law includes poker.

The game of skill situation has never been properly understood, said Founder/CEO of Skillz, Andrew Paradise, who has launched a skills-based mobile games which he partnered with GLU Mobile in May. Mr Paradise said that the determination can be confusing between the games and the different states for players and companies. He also mentioned that the business opportunity is huge.

Research conducted by an analysis company, Juniper Research, has estimated that gambling on mobile devices is expected to reach $100 billion all over the globe by 2017.

The gambling industry in the USA wants chance games to be legalised all over the country, and that they are lobbying for this to happen, the pace is gaining momentum. In the meantime, companies like Skillz are taking advantage of this large skills based field of gaming.

At this time, gambling and betting apps need to tip toe the many divergent laws that are currently on the books.

Skill vs. Chance

How to define a skilled game against a chance game. The game of Chess is considered a fully skilled game, while, a slots game is considered to be a game of chance. However, some are less easily defined, for instance Blackjack and Poker are considered to be games of chance, and therefore legally residents of 47 states cannot play them for money.

The depiction of skill vs. Chance can become murky, and the different states use various tests to help them in the classification, according to Skillz CEO. But, the various states differ in which test is best to use, and the methods they use to interpret the results. Some of them state that any degree of luck makes the game to be chance based. Others make allowances for a bit of chance in what is skill-based games. Some of them use the predominance test, for instance if a skilled player beats an unskilled player for about 75% of the time, then it will be determined as a game of skill. Another test is the material element which determines if chance is an important component to determine the outcome of the game. The last test is to figure out if the game needs a player to bet on their own ability to win a game - skilled games do, chance games don’t.

Skillz has hopes that this pick up of skill-based betting, will be a forerunner to gambling on games of chance, but, Mr Paradise thinks it will take five or more years before seeing it happen.

This is one of the biggest discussions ongoing in the country.