Interstate Compact Adds Michigan, More Shared Liquidity Coming Soon for US Online Poker
The day many online poker players have long awaited finally arrived on Wednesday. Gaming officials in Nevada, New Jersey, Delaware, and Michigan announced the expansion of the Multi-State Internet Gaming Agreement (MSIGA).
The deal expands the country’s online gaming interstate compact, adding the Wolverine State and paving the way for shared liquidity.
“The Multi-State Internet Gaming Association welcomes Michigan to its ranks, along with its nearly 10 million residents, who can now avail themselves of a full array of interactive gaming among the association’s member states,” manager of the association and Internet gaming manager for the Delaware Lottery Rebecca Satterfield said in a news release.
“The Association continues to be forward thinking and welcomes the interest of additional gaming jurisdictions in becoming party to the agreement.”
Hammering out a deal
The deal expands the current interstate compact by one state, but comments by Satterfield indicate more could possibly be on the way. Pennsylvania currently operates in a “ringed-in” environment, meaning players compete only against others within the state.
West Virginia and Connecticut have also legalized online poker, but have yet to see any operators launch. Adding those states to the agreement could make them more viable poker markets. Their addition to the compact would also mean even larger player and prize pools for poker operators.
Gaming officials have worked on the deal for the last 12 months. Michigan officials just needed to sign a few documents but that was expected to be complete within a few days.
Michael Morton, senior policy counsel at the Nevada Gaming Control Board, told USPoker that online operators could begin grouping player pools in any of the states soon.
“They can legally do it as soon as Michigan signs a couple of documents,” he said. “At that point, it’ll be up to the operators to get the requisite licenses if they don’t already have them in Michigan.”
The state appears ready to go and recently released its own guidelines for interstate poker. Morton expects the signing of documents to be completed quickly, allowing operators to launch their shared liquidity markets.
What does this mean for poker players?
WSOP.com currently operates in the only shared liquidity environment in the US, among Nevada, New Jersey, and in Delaware with 888poker. The company also recently launched in Michigan. The agreement means the company could now join all four states.
Partypoker US Network operates in Michigan and New Jersey with its Borgata Poker and BetMGM skins. PokerStars also operates in both states as well.The deal means party and Stars could also launch shared liquidity between those two states.
“An operator doesn’t have to operate in all states that are party to the agreement,” Morton said. “They can operate in two or more.”
Interstate compacts not only increase player pools, but cut costs for operators. That helps keep the US markets viable. Morton wouldn’t comment if negotiations are underway with Pennsylvania or any other states.
A look at market sizes
Adding Michigan gives a significant boost to the Multi-State Internet Gaming Agreement. The total population of all four states is about 23 million and here’s a look at the population of each:
- Nevada (3.1 million)
- New Jersey (8.9 million)
- Michigan (10 million)
- Delaware (1 million)
Of all three US operators, WSOP.com would have the largest with the All American Poker Network. Stars and party online players would also see a boost as well. Here’s a look at the three operators and the state populations their networks could serve.
- WSOP/888poker All American Poker Network – 23 million (Nevada, New Jersey, Delaware, Michigan)
- Partypoker US Network including BetMGM, Borgata Poker skins – 18.9 million (New Jersey, Michigan)
- PokerStars USA – 18.9 million (New Jersey, Michigan)
The agreement could lead to the largest player pools seen to US players since Black Friday. Adding Pennsylvania’s 12.8 million population would balloon player pools considerably more.
Making the US market viable
Operators also hope the increased player and prize pools coax even more players into the legalized markets.
“BetMGM applauds MSIGA for admitting Michigan into the consortium,” partyBetMGM director of poker Luke Staudenmaier said. “Shared liquidity is paramount to the growth of online poker and this is a huge step in the right direction. We remain committed to expanding BetMGM’s poker offering and look forward to serving shared player pools in the future.”
In February, several online players spoke with USPoker about the potential for the market with interstate compacts. Four-time World Poker Tour and partypoker/BetMGM ambassador Darren Elias sees big things ahead and said his company would be ready to move forward quickly with linking player pools.
“I think there is an enormous potential for US online poker,” he said. “Players are eager to get online and play again in safe, regulated markets, but we are still limited by ring-fenced legislation for now.
“As more states are approved and interstate compacts are eventually made, the player pool will grow rapidly. I’m working with BetMGM now to lay the framework and be ready for this expansion when it comes. I believe online poker will be a major market in the United States once again, and BetMGM will be leading the charge.”
HOOKING UP: Could interstate compacts be on the way in 2022 for US online poker industry? There are some clues that say yes.https://t.co/Y7WV8qRWjW#poker #pokeronline #onlinepoker #pokernews #pokergrind #pokerlife
— US Poker (@uspoker) March 30, 2022
Background on the agreement
The MSIGA deal was originally struck between Nevada and Delaware in 2014. New Jersey joined the agreement in 2017, expanding the association’s shared liquidity to full online casino gaming.
The association, a Delaware corporation, manages the affairs of member states. Currently, Michigan and Nevada offer online poker to member states, while Delaware and New Jersey offer a full line of online gaming.
Expansion of interstate compacts was stymied for years after the Trump administration argued that the agreements violated the Wire Act. The legal actions left only WSOP.com operating in a multi-state environment.
However, states argued the Wire Act only applied to sports betting and the New Hampshire Lottery appealed the ruling. In 2021, a federal appeals court ruled in favor of the gaming industry. The Biden administration chose not to appeal the issue further.
That’s now allowed for more interstate compacts and that played out with the expansion announced on Wednesday. Like many poker players, gaming officials also seemed pleased to see some traction on the issue.
“From the regulator’s point of view, this is a factual thing,” Morton said of announcing the agreement. “But we’re not strangers to economics. So obviously, the more liquidity that’s available, the better.”