The U.S. regulated online casino marketplace has been the most impactful in terms of new gambling markets worldwide. Although the European (and particularly UK) online casino market is larger than its American counterpart, the U.S. is alone as an example of a regulated marketplace with the size of its potential player base; rate of revenue expansion; amount of publically listed operator funds available for use; and unregulated opportunities for additional legalized markets. In 2012, the U.S. had zero gross gaming revenue from online casinos. By 2026, the U.S. will generate over $10B in GGR. Therefore, there exists an opportunity for a comprehensive analysis of this industry segment-by-segment, state-by-state and year-by-year.
Defining the Market: What iGaming Includes
Prior to our numbers, we have a definitional point. In the U.S. regulatory framework, “iGaming” means, specifically, internet-based, real money online casino gaming: that includes slots, blackjack, roulette, baccarat, video poker, and live-dealer style gaming – available on the web or through an application on your phone. This is different than:
- Online Sports Betting – Most states have created their own licensable models for sports betting and it will be bigger than iGaming as far as gross handle goes but with much less margin.
- Daily Fantasy Sports (DFS) – DFS was already operating in many of these jurisdictions when there were few laws governing how it operated and therefore has been treated differently in many jurisdictions as a separate model of gambling.
- Social Casino/Sweepstakes Platforms – These types of platforms use alternative currency and/or award prizes through mechanisms which are outside of gaming regulations to operate as they do.
- Poker – Also separately regulated in several states.
Our reporting uses the term “market size,” referring to GGR (gross gaming revenue) in the case of iGaming. GGR represents the net profit earned by operators, minus what they pay back to players as winnings. The overall number of bets placed in all legal jurisdictions is known as the “handle.” For example, while iGaming hold rates can range from 4-8 percent for table games and 8-12 percent for slot machines; total wagers across all legal jurisdiction is greater than $100 Billion per year; and because of those low margins, legal U.S. iGaming GGR is approximately $10 billion.
Current Market Size: The 2026 Snapshot
BY 2026, the U.S. iGaming Market had established a strong pace of growth from its initial launch over the past three (3) years. Legal aggregate iGaming Gross Gaming Revenue (GGR) is expected to exceed $10.5-11 billion for calendar year 2026 as it continues on a growth trend which has averaged an annual increase of 28 percent per annum since Michigan and Connecticut first began offering iGaming in 2021.
US iGaming GGR by state (2025 actuals and 2026 projections):
| State | 2024 GGR | 2025 GGR | 2026 Projected GGR | YoY Growth | Launch Year |
| New Jersey | ~$2.35B | ~$2.65B | ~$2.90B | +9.4% | 2013 |
| Pennsylvania | ~$2.10B | ~$2.45B | ~$2.80B | +14.3% | 2019 |
| Michigan | ~$1.65B | ~$2.05B | ~$2.45B | +19.5% | 2021 |
| Connecticut | ~$420M | ~$510M | ~$600M | +17.6% | 2021 |
| West Virginia | ~$165M | ~$195M | ~$220M | +12.8% | 2020 |
| Rhode Island | ~$110M | ~$145M | ~$175M | +20.7% | 2023 |
| Delaware | ~$45M | ~$48M | ~$50M | +4.2% | 2013 |
| Total | ~$6.85B | ~$8.05B | ~$9.17B | +13.9% | – |
Market Drivers: What Is Actually Powering Growth
The only way to achieve double-digit iGaming growth in a space that’s legal only in 7 states is through real momentum drivers. There are several momentum drivers occurring simultaneously.
Cross-selling to sports bettors
The number one momentum driver for iGaming in 2026 will be converting existing sports betters into new casino players. Sportsbook operators (Draft Kings, Bet MGM, Fan Duel) that operate both licensed sportsbooks and casinos promote their casino offerings to their sports book customers. Conversion rates and economics are attractive:
- A sports-only bettor produces approximately $400-$600 per year on average in gross gaming revenue
- A cross-sold sports and casino player produces approximately $1800-$2500 per year in gross gaming revenue on average
- Cross selling conversion rates of sports-betting customers into casino customers increased from approximately 12% in 2021 to an approximate 20-25% in legal jurisdictions as of 2026
- Each percent of cross-selling conversion rate in a jurisdiction such as Pennsylvania or Michigan can result in tens of million dollars of additional iGaming Gross Gaming Revenue
This means iGaming growth is also a delayed benefit to the extent it occurs because of the growth of sports betting. Therefore, states that initiated the launch of sports betting between 2019 – 2021 will begin experiencing the “maturation” of their cross-sell opportunity for generating iGaming revenue. This is true regardless if there has been no growth in the overall size of the sports betting player base.
Product improvement and game library expansion
The overall number and quality of Legal US Online Casino offerings in 2026 is clearly greater than those available at the time of their initial launches in each State individually. As a result of expansions to large markets, the average online casino library size has grown from the original 200-400 title ranges to well over 1000+ today. Live Dealer Catalogs have evolved from offering just Blackjack & Roulette, to include Game Show Formats (Crazy Time, Monopoly Live), Speed Variants & High Stakes VIP Tables. Improvements in mobile app performance continue to reduce player churn within an operator’s active user base and increase conversion rates on new customers.
Loyalty and rewards integration
The major operators have put significant amounts of money into a unified loyalty platform to incentivize players to engage across products. All of these systems (DraftKings’ Crown Rewards; BetMGM’s M life Rewards; FanDuel Player Reward) are designed to be barriers to entry by creating “switching costs” for those players who have built up status or rewards points within a given ecosystem. In turn, as both loyalty programs continue to grow and become more entrenched – and as existing players accumulate more years of experience – the incremental revenue generated per retained player will increase.
Additionally, additional growth opportunities exist in 2026 for the industry through:
- Improved payment options – instant withdrawal via PayPal/Venmo/digital wallets reduce friction associated with deposits and cashouts
- AI driven Personalization – longer sessions and more frequent deposits from customers actively engaged
- Enhanced live dealer product quality – increased adoption of premium products with larger average bets
- Operator marketing improvement – Better target acquisition spend = better customer
Competitive Landscape and Market Concentration
The U.S. iGaming market is more concentrated than the sports betting market at operator level due to greater barriers to entry for operators in iGaming (content partnerships, state-by-state game certification, studio infrastructure), and early-mover advantage in long-tenured markets like New Jersey.
Estimated iGaming GGR market share by operator (2026):
|
Operator |
Approx. Market Share | Stronghold State | Parent |
| DraftKings Casino | ~25% | Pennsylvania, Michigan | DKNG |
| BetMGM Casino | ~24% | New Jersey | MGM/Entain JV |
| FanDuel Casino | ~18% | Pennsylvania, Michigan | Flutter (FLUT) |
| Golden Nugget Online (GNOG) | ~8% | New Jersey | DraftKings |
|
Caesars Palace Online |
~10% | New Jersey | CZR |
| Hard Rock Bet Casino | ~5% | New Jersey, Michigan | Hard Rock Intl. |
| Others (Rush Street, Unibet, etc.) | ~10% | Varies |
Various |
The DraftKings effective combined share is very close to 33 percent and represents a significant lead over all other operators in terms of overall market share. DraftKings dual branding also allows the company to keep each brand’s community intact while still allowing players who may want to be part of either community to do so without having to choose one or the other.
DraftKings, BetMGM, and FanDuel represent approximately 66.7% of the New York State Sports Betting Market. Caesars and Hard Rock are ranked third and fourth respectively based on their brand name recognition and the loyalty they have established within their respective customer bases; however, both companies lost share over the last two years because their investments in sports betting technology were behind those of the three leading brands. Rush Street Interactive (operating primarily through the BetRivers brand) is an independent sportsbook operator with disciplined use of capital and a proven track record in Pennsylvania; however, as a result of its limited reach nationally (sub 5%), Rush Street does not yet occupy a competitive space in the New York State marketplace.
The Legalization Pipeline: Markets That Could Change Everything
New York represents by far the largest untapped opportunity for iGaming in the United States. A fully competitive iGaming market with 20 million adult residents and some of the highest per capita incomes of any U.S. State could easily surpass both NJ and PA in terms of GGR within three years after the launch date. Mature Market estimates for annual GGR range from $4-6B.
The political environment is now favorable. Gov. Hochul’s Administration seems increasingly open to iGaming legislation as a way to raise additional government revenue and there was significant legislative progress made throughout 2025 into 2026. There are two major hurdles; (1) Tribal Compact Negotiations – Several federally recognized tribes have gaming rights in NY and will need to be incorporated into any I-Gaming Framework; (2) Cannibalization concerns for land based gaming.
Illinois
Illinois ranks No. 2 among all U.S. states by dollars wagered on sports through regulated channels; Illinois also has one of the most effective regulatory frameworks in the country. Tribal groups have largely blocked efforts to expand iGaming (online gaming), however, due to their historic control over casinos and politics associated with issuing new casino licenses in non-physical format. As such, the state’s three-tiered tax on sports betting (reaching 40% in 2024 for the top sports bookmakers) serves as a model for how iGaming taxes could severely limit profitability for operators if they are structured similarly.
Indiana
Indiana has a long-standing commercial casino industry and a strong sports betting system currently being implemented. Bills introduced at the legislative level to include iGaming have been much further along than those proposed in Illinois, and many of the larger companies believe that 2026 will be a viable start date to operate if legislation is passed this year.
Maryland
Maryland began offering sports betting in 2022 and has shown steady growth since then. Although Maryland is a relatively small market with approximately six million adult residents, the state is close enough to Washington D.C., has a developed regulatory apparatus and thus is considered an easier route to legalize.
California
The Golden State represents the ultimate long term target – over 30 million adults, and the largest U.S. state economy; however, the combination of California’s political climate and tribal gaming creates an atmosphere in which it is challenging to predict when (or if) legalization will occur. The repeated defeats of California’s sports betting ballot initiatives has cooled the near-term interest in iGaming legislative efforts. Industry insiders generally believe that California can be considered a 2028-2030 time frame or later for legalizing online gaming.
GGR potential of key unlicensed states:
|
State |
Adult Population | Est. Mature-Market iGaming GGR | Legalization Timeline |
| New York | ~20M | $4-6B | 2026-2027 (possible) |
| California | ~29M | $5-8B | 2028-2030+ |
| Illinois | ~9.5M |
$1.5-2.5B |
2026-2027 (possible) |
| Texas | ~22M | $3-5B | 2028+ |
| Florida | ~17M | $2.5-4B | Uncertain / tribal |
| Indiana | ~5M | $700M-1B | 2026 (likely) |
| Maryland | ~4.5M | $600M-900M |
2026-2027 (possible) |
Five-Year Market Forecast: 2026-2030
Forecasting iGaming revenue is based on a range of possible outcomes because it has two distinct possibilities for legalization. Therefore, forecasting does not rely on predicting one number, but instead relies on determining which of several scenarios will occur. The base-case assumes no new legalized jurisdictions. This would result in the current 7 states continuing to grow at a moderate pace as each matures. Michigan and Rhode Island would be expected to continue their above average growth. New Jersey and Delaware could be expected to slow down their growth. Growth in Indiana and Maryland could be expected to be limited to an additional small amount of revenue.
- 2026: ~$9.5B
- 2027: ~$10.8B
- 2028: ~$12B
- 2029: ~$13B
- 2030: ~$14B
US iGaming 5-year forecast summary:
|
Scenario |
2026E | 2027E | 2028E | 2029E | 2030E |
| Base case | $9.5B | $10.8B | $12.0B | $13.0B | $14.0B |
| Optimistic case | $10.5B | $13.0B | $17.0B | $20.0B | $23.0B |
|
Bull case |
$10.5B | $13.5B | $19.0B | $25.0B |
$32.0B |
The difference of almost twenty billion dollars ($14 billion vs. $32 billion), between the base and bull cases for 2030 demonstrates that the entire process of legalizing cannabis will be the single most important factor to consider when making long-term forecasts. All of the other factors in the business model are positive, they are somewhat predictable, and include cross-selling, improving products, building customer loyalty, and demographic changes. But one factor is entirely unpredictable; which state legislative body will pass a law related to the sale and use of marijuana, and at what time.
What Market Size Means for Operators and Investors
In the case of the publically traded iGaming operators (DraftKings, Flutter, Penn, Caesars) the size of the iGaming market is not just an academic study. Rather, it directly influences their revenue, margins and valuations.
iGaming has inherently higher margins than traditional sports wagering. The hold percentages are greater on iGaming products, the trade risks associated with pricing are much lower due to no “sharp” bettor that can exploit inefficiencies in pricing, and the customer lifetime value (CLV) for iGaming customers is dramatically better. In addition, when you have a mature iGaming market in a large U.S. State, you essentially have a land based casino economic model. Therefore, while there may be some volatility inherent to each state’s gaming handle (similar to traditional gaming), these states are generally predictable and exhibit long term compound behavior which is less volatile than many other industries.
For investors tracking this space, the following are among the most important measures to follow as the industry continues to grow:
- Growth rate of gross gaming revenue (“GGR”) by state. The GGR growth rates for each state should slow down as those states mature (as they do with many forms of gaming). If new states (e.g., Michigan or Rhode Island) begin to show significant increases in GGR growth rates, then it would indicate that there are growing numbers of players in each of those new jurisdictions.
- Trends related to hold percentages. As operators expand their offerings to include higher margin games (slots), etc., we would expect to see upward trending in their respective hold percentages.
- Cross-sell conversion rates. The primary metric that leads to future iGaming revenue performance for dual product operators (sports betting & iGaming) is the cross-sell conversion rate of their sports betting customers who also become casino players.
- Launch timelines for each of the remaining states. When there is credible news regarding potential legislation or regulation changes in NY (which has been shown to occur repeatedly over the last few years) operator stock prices historically move up by double digit amounts within a matter of days.
- Revenue per active user (RPUA). RPUA is the ultimate measure of both how well your product(s) meet the needs/engagement of your users as well as ultimately how successful your product(s) will be in generating revenue from existing users.
This provides an opportunity to view the development of the US iGaming market in 2026 through two different lenses. On one hand, it will continue to provide consistent, reliable near-term revenues. On the other hand, because the number of jurisdictions where iGaming is currently permitted remains limited, the optionality available to companies developing these products today remains substantial. This unique combination – reliability of current near-term revenue coupled with substantial future optionality – positions the US iGaming sector among the most highly followed globally across all segments of consumer finance.