Online Betting & Gambling In California: Is It Legal Yet?

Published in cooperation between BetMGM Money Casino and the King City Rustler

California is known as the Golden State, with ample growth for opportunity and innovation extending to its approach to online gaming, gambling, and betting. With a rich history of tribal gaming and a thriving offline casino industry, the Californian state has been at the forefront of the gaming world for decades. Although the online betting industry is still uncertain until 2025, gambling and betting fans in California are waiting in suspense for this to change.

The Current State of Online Betting in California

If you didn’t already know, online sports betting in California is illegal. This issue has remained the same for many years and has seen no growth since the Professional and Amateur Sports Protection Act (PASPA) was abolished in 2018 by the California Supreme Court. 

In November 2022, two propositions were put to all the voters throughout California after gaining enough signatures to appear on the ballot. Unfortunately, both propositions were soundly rejected, but since then, several proposals to legalize sports betting have been put forward in the state.

Overview of Propositions 26 and 27

Proposition 26 was introduced by 18 California tribes in 2019. The main purpose was to legalize in-person sports betting at over 80 tribal casinos and expand the existing casino gaming options. Ultimately, more than 50 tribes supported the measure, but it was defeated at the polls, garnering only 29.9 percent of the vote.

Proposition 27, backed by major multi-state sportsbooks, proposed legalizing online sports betting in California. It required online sportsbooks to partner with tribal casinos and allocated 85 percent of the tax revenue from sports betting to support homelessness and mental health initiatives. However, it was decisively rejected by voters, receiving only 16.6 percent approval.

What Type of Online Gambling Is Legal and Illegal in California?

Online real-money gambling is currently not regulated by California. As a result, California players can participate in various forms of online gambling, even if the games are prohibited within the state; this includes online casino games such as:

• Online slot machines
• Poker
• Blackjack
• Baccarat
• Roulette
• Craps
• Online sports betting

While sports betting (excluding horse racing) is illegal in California, online daily fantasy sports are not regulated. The ruling parties are currently discussing the California Gambling Laws, and several ballot initiatives are pending. This means that there could be a change in the landscape of sports betting in California. These initiatives propose to legalize sports betting without needing legislative approval and differ in where gambling would be permitted.

What Are Sweepstakes Models Compared to Real Money Betting?

Because many U.S. states, including California, have strict regulations on online gambling, sweepstakes platforms have become a popular alternative to traditional real-money online casinos. The sweepstakes model began a few decades ago and gained significant traction by the early 2000s. 

Although sweepstakes models are similar to real-money betting casinos in that players use virtual money to place wagers and win prizes, such as vouchers or physical rewards, real-money sites offer entertainment and social interaction with the risks of real-money gambling.

In contrast to lotteries, sweepstakes do not ask participants to purchase tickets. Instead, casinos provide entries to their loyal customers based on their level of engagement, giving them the opportunity to win exciting prizes and rewards at no cost. This approach has gained so much popularity, especially in areas with strict gambling laws. This is because it lets companies and casino sites offer games of chance without breaking any regulations against gambling.

The Role Tribal Casinos Play in the Californian Gambling Industry

A tribal casino is a type of casino situated on Native American land. Due to tribal sovereignty, states cannot restrict gambling activities on these lands, as established by the Indian Gaming Regulatory Act of 1988. California hosts over 100 federally recognized Native American tribes, with about two-thirds participating in some aspect of the state’s gambling industry. Tribal casinos play a considerable role in the Californian online gambling industry by:

• Creating more job opportunities
• Using casino profits to help social development in the state
• Ensuring the safety and security are top-notch

In addition to this, the federal and state governments do not charge taxes on tribal casino gaming activities and the casino games are not regulated in the usual way. This means that tribal casinos can also generate higher revenues. 

The Future and Legalization of Online Betting in California

As signatures are gathered, the future of sports betting in California looks promising but remains uncertain until 2025. The decisions made through these initiatives will not only influence the state’s gambling industry but also impact tribal participation in legislative matters related to their enterprises. 

With the 2024 online betting ballot approaching, California faces a critical moment as it navigates the complex issues of gambling laws, tribal rights, and voter preferences. The upcoming months will be pivotal in deciding whether sports betting will become legal in California or if the state will continue to prohibit it.