History of Online Casinos

History of Online Casinos

Every so often we must step back and marvel that average people have had access to the internet for only about 25 years. Really, where would we be without it?

Online gambling and casinos didn't come about immediately. Two small nations in the Caribbean, Antigua and Barbados, passed the Free Trade and Processing Act in 1994. This enabled entrepreneurs to establish the first online casinos and to avoid being under the control of U.S. laws and regulations.

The first software for online gambling was developed by two pioneering companies, Microgaming and Cryptologic.

The Watchdogs

As the number of online casinos exploded in the mid and late nineties, it became apparent that the industry would either need to regulate itself or be subjected to regulation by governments. Thus the Canada-based Kahnawake Gaming Commission was established in 1996. Online casinos submitted their product to the scrutiny of the watchdog commissions and any untoward activity would be severely punished, primarily by internet-wide bad publicity.

Random Number Generator

At land-based casinos you see each spin of the roulette wheel, each throw of the dice in craps, and each card played in blackjack or poker. Online casinos needed an absolutely reliable way to guarantee that they weren't controlling the outcomes of games. The RNG provides this guarantee. It generates numbers even when a game is not being played. So when you click "play" it chooses the last number generated. This is done so rapidly that it is impossible to game the RNG.

The U.S. Government

In 2006 the U.S. Congress passed a law called the Unlawful Internet Gambling Enforcement Act (UIGEA). This law made it unlawful for any American financial institution such as a bank, credit union, or credit card company to have financial dealings with any internet gambling establishment. This made it functionally impossible for Americans to gamble online because there was no way for them to deposit and withdraw money.

The main reasons given for the passage of the UIGEA were that minors were gambling and that the ease with which players can access online casinos made gambling addiction a more serious problem than before. While these two problems were legitimate, some felt that the U.S. government simply wanted to channel gambling money into state-run enterprises such as horse and dog racing, jai lai, and especially lotteries. Lottery winnings are fully taxed in the U.S. and the government wanted those revenues. Online casinos willingly offered to be regulated by the U.S. authorities but, as of now, they have been rebuffed.  Online casinos are fully regulated in many other countries and are thriving.

Technological Advances

As good as it was, the original gambling software was primitive by today's standards. Every casino game offered today is a marvel of software sophistication. Players expect their favorite casino to introduce new products regularly.

Certainly the biggest news in online gambling in the very recent past is the rise of mobile gambling. The software is so clear that even on the small screen the games are easy and fun to play.

Online Bingo

Technology has made online bingo one of the fastest growing games in the world. With the "auto-daub" option the computer does all the work so you can play as many cards as you like. Online bingo has become one of the most popular pastimes for women in their twenties. More than one billion dollars are wagered each year in online bingo.

Bingo was offered at online casinos from the outset but has come into its own with the advent of online bingo parlors.

When you let the computer work for you, you have other options as well. The computer can sort your cards so that you know which card is closest to bingo. The computer may sort the cards in order of closeness to bingo or simply highlight the card that is closest to bingo.

Another aspect of online bingo that makes it so popular is the chat room. In live bingo, speaking is discouraged because it distracts your neighbors. Online, however, you can chat with whoever wants to chat with you. There are rules governing chat, of course, but it adds immeasurably to many players' enjoyment of an evening at bingo.

Finally, the internet allows bingo sites to network with each other. Essentially, they share players. This leads to higher jackpots.

Online Poker

Poker lagged behind other casino games as an online option.  Whereas the first casino went online in 1994, it took four more years before Planet Poker became the first online poker site. 

A poker site called Poker Spot went online in 2000.  Soon it was discovered that the site was unable to keep track of the money deposited by players.  Poker Spot couldn't pay out winnings and soon went out of business.

This led to the widespread use of NETeller as an online wallet.  NETeller makes it easy for players to deposit and provides a low-cost money-management service to the online sites.

Party Poker began a television ad campaign in 2003, gaining the top spot among online poker sites.  An unknown player, Chris Moneymaker, entered an online tournament at Party Poker.  By winning the satellite tournament he qualified for the World Series of Poker which, incredibly, he won by besting some of the best-known professional poker players in the world.  The publicity from Chris Moneymaker's rise from unknown to champion created an explosion in online poker.

The World Series of Poker began being televised in the wake of Chris Moneymaker's meteoric rise to fame.  This has led directly to ever greater popularity for online poker.


The history of online casinos is short but online gaming has become such an everyday part of life that we sometimes don't realize just how recently gaming came to the internet.  We can say with confidence that the next twenty years will bring many technological and regulatory advances and surprises.

Posted by CCJ Team