Nevada and Delaware sign liquidity sharing agreement under new Multi-State Internet Gaming Association

26 February 2014

Marco Valerio

Delaware and Nevada want to “push forward as quickly as we can” with the online poker liquidity sharing agreement but remain non-committal on Sen. Heller's federal initiative.

The governors of Nevada, Brian Sandoval, and Delaware, Jack Markell, have formally signed the Multi-State Internet Agreement to lawfully enable each state's online gaming sites to begin sharing player pools, primarily for poker. This is the first official motion toward a liquidity sharing agreement in US online gaming history.

In addition to signing the agreement, the governors also announced the formation of the Multi-State Internet Gaming Association (MSIGA), a Delaware-headquartered entity meant to serve as a regulatory hub for multiple states who wish to subscribe to it and share their own online player pools. The MSIGA will tentatively govern the new agreement between Nevada and Delaware.

The governors signed and discussed the agreement at a press conference in Wilmington, Delaware, on Tuesday. No specifics were divulged about the multi-state regulations, but both governors stressed that the regulatory and fiscal sovereignty of each state would be respected.

“Generally speaking, each state will receive the percentage of the rake from each poker hand that's attributable to players from that state,” said Governor Markell. “Players from Delaware will be subject to the Delaware laws and regulations, and players from Nevada will be subject to Nevada's laws and regulations.”

Governor Sandoval echoed this view. “This agreement strikes the necessary balance between reasonable regulation and state sovereignty,” he stated. “It establishes a regulatory board comprising representatives of member states to oversee and implement minimum standard provisions, which will ensure that online gaming is conducted honestly in accordance with state law.”

Three separate online poker sites are presently operational in Nevada – Ultimate Poker, and Real Gaming. Delaware's three brick-and-mortar casinos are emulated online via a single operator, 888.

The London-listed operator welcomed the news of the agreement. Brian Mattingley, 888 chief executive, said: "This pooling compact will help 888 and its partners deliver a world-class gaming experience to poker players in Delaware and Nevada given we are the only operator live in both, vindicating our approach to launch in all regulating states. We are grateful to both states for their continued steadfast commitment to regulating our industry. We look forward to additional states entering into such interstate agreements." 

The two states' igaming sites have not yet begun sharing players. The governors would not guess at how long it would take for the agreement to go into practical effect, but they both expressed a desire to “push forward as quickly as we can”.

While Delaware can offer a broad range of casino games online, Nevada is limited to poker. “Today this is an Internet poker agreement between Delaware and Nevada,” said Markell, “but we know that more games and more states mean more players which mean more revenue to participating states, and that's why we wanted this agreement to be flexible enough to expand.”

Sandoval added, “We hope it will serve as a model for multi-state collaboration and that other states will see the benefits of the agreement and soon decide to join for themselves.”

Governor Sandoval was asked whether he foresaw an eventual agreement with New Jersey, the only other US state to have introduced regulated igaming. “I have had conversations with New Jersey,” he responded, without going into specifics. “We'd love to have New Jersey as a partner as well.”

The announcement of the first US online gaming liquidity agreement comes only a week after the Nevada Senator Dean Heller told the press that he expected a federal bill banning all igaming in the US except online poker to surface “in the next month or so”. Governor Sandoval, who was once favorable to such a federal initiative when Senators Harry Reid and Jon Kyl attempted to introduce it in 2012, indicated that he may have altered his view.

“That federal bill has been out there for several years now,” he said during the press conference. “We can't wait. I see this [MSIGA] as an opportunity for the states to show leadership and show that it can work, and demonstrate that it can be done lawfully and be well regulated.”

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