Paypal Irritates Online Gaming

Published December 4, 2002 by OCR Editor

Paypal Irritates Online Gaming

How PayPal and similar companies confront the states' efforts to curb online gambling. The payment industry is responsive, alright.

Although internet gambling has not been approved by any state in the U.S., analysts say that the U.S. market takes up 65% of online gambling. State attorneys are trying to curb online gambling by targeting companies like Paypal that help online gamblers play more easily. This action by state attorneys is due to the fact that prosecuting gambling behavior is difficult because the legality of gambling online is nebulous.

Congress has not been able to pass clear cut laws regarding the legality of internet gambling. Due to this "up in the air" status of online gambling in the U.S., casino advertising online has been cutback. For example, Yahoo took away its ads on virtual casinos.

Gaming council sources say that online gambling is here to stay and that it would be wiser for the U.S. government to legalize online gambling to rid the market of fraud and criminal activities such as money laundering. Also, the council believes that by legalizing internet gambling more taxes could be raised.

Since Paypal has backed down from the internet gambling market for the present time, analysts believe that the slack in gaming profits is only temporary. Other even more sophisticated pay plan companies are already beginning to surface, perhaps even replacing Paypal, to increase online profitability.

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