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History of Online Casinos – When Did the First Ones Emerge?

Written by:
Payton
Published on:
Mar/23/2020

There are literally thousands of online casinos out there, with tens of millions of players. The global online gambling market, in 2017, was worth $45.8 billion, and that number is increasing every year. Make no mistake, the online gambling industry is huge according to Kasinohai, but it didn’t appear overnight.

 

Online casinos have had a few decades to mature now, but they’re very different to when they first appeared. While many people first looked at the sites with skepticism, now millions of people regularly log into their favorite online casino platforms and play their favorite games. Whether it’s on their phone, laptop, or computer, online casinos are one of the biggest forms of gaming out there. 

 

So where did it all begin?

 

The First Online Casinos Appear

 

It all started in 1994 when the Free Trade & Processing Act was passed in Antigua and Barbuda. This legislation introduced licenses that were granted to companies wishing to open the first online casinos. They were built on software already being used by Isle of Man software company Microgaming – a legend in the industry that still makes games today. 

 

By combining the software with new online licenses and online security software known as Cryptologic, companies began creating the first-ever online casinos. And they were popular. 

 

Within just two years new measures were taken to ensure that these online games were transparent and fair for all users. In an attempt to ensure people weren’t being scammed by companies with bad intentions, the Kahnawake Gaming Commission was established. 

 

By the end of the 1990s, there were hundreds of websites operating. Within less than five years, literally hundreds of online platforms started offering their services to gamers all over the world, using software not just from Microgaming, but other competing companies that are also still developing games to this day. By 1998, online casino revenues were approaching $1 billion, reaching $830 million. It took just a few more years to pass this milestone. As we enter the new decade, the industry is expected to surpass its $100 billion valuation. 

 

The New Millennium

 

In the year 2000, online casinos were safer and more regulated than ever. More countries began realizing the potential for customers being ripped off if governments didn’t ensure every gambling site was licensed and certified. Australia got particularly strict, passing legislation that stopped casinos that were launched before the year 2000 from operating in the country.

 

The United States, the United Kingdom and other European countries weren’t quite as strict, but more and more legislation was passed on a global basis. As more gamers gambled online, regulatory authorities began appearing, offering customers the peace of mind they needed to make transactions online. 

 

The United Kingdom only legalized online gambling in 2001 – the same year that Alderney began handing out online gambling licenses. And, you might not believe it, but the first live dealer casino was introduced in this same year. The quality wasn’t as great as you’d expect today, but they worked!

 

In 2003, the UK also established eCOGRA, an internationally approved testing agency that is designed to ensure high standards from online casinos. 

 

From here, the industry boomed. Regulation meant customers felt safe using the online platforms, and as more people got on board, more casinos and software developers appeared!

 

New Technology

 

Just a handful of years ago, online casinos started peaking in terms of what they could offer. There are hundreds of companies who develop thousands of different games, but innovation became stagnant as developers were using tired old tactics to keep people interested.

 

Sure, they could develop new themes and sure, they could keep incorporating minigames. But what else was there?

 

That’s where technology comes in. With major improvements in Internet speeds, online casinos have been able to develop live dealer games that give people a real-life casino experience without having to leave their home. New technology allows people to watch a game unfold in a land-based casino as if they were really there, interacting with the dealer using controls on their smartphone, tablet, or computer. Live casinos did already exist, but quicker Internet speeds have improved the experience greatly. 

 

Right now, this is one of the most popular new kinds of games on offer. But 3D games are up there too. 

 

Developers are finding new ways to pack graphics-intensive games into small packages, meaning browsers can load these games as if they were being played on a console. Many online casino games have been converted into 3D-style adventures, giving people a chance to go beyond slots. After all, slots as a concept are hundreds of years old already!

 

The future has a lot in store for online casinos, too. Virtual reality and augmented reality are already here, and as the technology is refined, you can bet casinos will start allowing customers the opportunity to transport themselves to famous Las Vegas casinos using headsets and their smartphones.

 

Watch this space!

 

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