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Are Bitcoin Casinos legal in the US?

El Monte, CA |

I've been interested in possibly buying a Bitcoin casino but before I do so I want to make sure it's legal to own one in the US. I noticed that theirs a ton of virtual casinos on faceboon where you can buy tokens to gamble with and those are legal, the tokens can't be withdrawn for cash thought not sure if thats why it's legal.

Now with Bitcoins I'm not aware of any laws on the books about virtual currency and online gaming. Is it legal?

Attorney Answers 3


It depends on the state but, for example, as of July 1st, a new statute passed in Florida that has been interpreted to rule BitCoin as gambling. There's no "cash" but there is value in a game of chance. Now, there's litigation pending as virtual cafés try to reinterpret the new rule, but the overall feeling is if it can be accessed in Florida, you've broken the law in Florida.

Upshot? I would stay away from it for a years, but that's a wager you'll have to decide whether or not to make on your own (pun intended). In the least, though, hire an attorney immediately if you plan on moving forward.

Hope this helps!

Thank you for taking the time to read my answer and if it helped, please mark it as "Helpful" so I can track the quality of my responses and better determine the needs of Avvo users. Please note, however, the information I have provided is general in nature and its reliability is restricted to my licensed jurisdictions – Florida and Texas – in most circumstances. Any lessons you may walk away with should be reviewed by separate counsel as I do not represent you and do not know your personal circumstances. That said, feel free to get in touch directly if you are considering retaining professional representation.

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Bitcoins are freely and easily tradeable to real currency, making them a "thing of value" for the purposes of gambling laws. Although there is little caselaw involving its use in gaming operations, the fact that it is treated and marketed as a currency (despite not being accepted as legal tender) and most importantly that it is convertible to hard currency at known and marketed exchange rates, it will almost certainly be treated as if it were currency in any litigation. Just because you see casinos online that do something, doesn't mean that they are legal. This is not to say that it would be illegal everywhere, but it would very likely be treated as a casino in the U.S. if that's where the virtual casino was hosted and operated. More often, these things are registered in Antigua, or other offshore locations.

Though I'm a skeptic about Bitcoins, I do deal with Bitcoin issues and alternative/virtual currencies fairly regularly in my practice, including their use in gaming issues. My analysis generally has been that the growing ubiquity of virtual currencies in both entertainment (video/PC) gaming and traditional (casino) gaming will result in a flurry of litigation and new statutes passed governing these currencies in the next 5-10 years. For instance, what happens when you're told that you will be taxed on a Bitcoin transaction? What conversion rate do you use? What remedies do you have when your Bitcoins are stolen from a virtual "bank" as has happened at Mt. Gox and Bitcoinica? What happens when your business is sanctioned for violating financial security regulations due to inherent vulnerabilities in the Bitcoin wallet system for Android? Or if you're sanctioned for violating KYC laws for insufficient information about an anonymous BitCoin transaction? These are all issues that you may find yourself facing if you deal with a business like this. You shouldn't dive in without having experienced counsel review your plans and advise you of the risks.

Best of luck.

I focus my practice on (video) gaming industry, casino gambling, and complex internet law issues, electronic free speech, entertainment law, copyright and trademark law, and computer fraud. I primarily represent game developers and founders of emergent internet technologies. The author is a Maryland attorney; however no answer given on Avvo is intended as legal advice or intended to create an attorney-client relationship.

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Mr. Rosenthal addressed this very well. A European court recently ruled that Bitcoin is a currency. With the recent jump in popularity of the issue, the question of whether it's a currency in general (not just in relation to gambling) is sure to be litigated here soon. From a practical perspective, it's a huge gamble (no pun) to invest in a business on very unsteady legal ground.

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