Real Money Online Casinos
The gambling industry as a whole generated $423 billion in profits worldwide in 2015, according to Morgan Stanley. Online casinos were responsible for 9% of that, or $37 billion. Compared to lotteries, which account for almost 30% of gambling revenues worldwide, online casinos for real money make up a relatively small segment of the niche. But that small segment is still huge.
The purpose of this page is to provide an overview of this segment to prospective players. We explain what online casinos are, how they work, and what you need to know before risking money playing at any of these sites. We also address some of the legalities in the niche and the differences between Internet gambling and traditional, brick-and-mortar gambling.
What is an Online Casino
For our purposes, an online casino is any place where you can play games online for real money. That's a little bit different than some definitions, but it makes for a more interesting and useful page. Other sites might define the phrase more narrowly—preferring to focus only on sites which offer traditional, house-banked casino games like blackjack or slots.
But for our purposes, even an online poker site, where players compete against each other instead of against the house for money, counts. So do skill game sites, where players compete in tournaments at games of skill for money. We even include Internet bingo sites in the category, and since most of them also offer slot machine games and video poker, it's entirely fitting that we do so.
It's important to remember that gambling is only gambling when there's actually something of value at risk. You'll find plenty of sites which offer free games with no chance of losing (or winning) cash. Those sites don't get to be included in this category. Most Web-based casinos offer free versions of their games, but as long as they also offer the option of playing for real money, they count.
The differences between some of these online casinos are slight. Many sites are owned by the same company, for example. They use the same software as the other sites owned by that company, and the only difference from one of those sites to the next is the look and feel and the branding. Sometimes the promotions available differ, too. And occasionally you'll find multiple gambling websites which offer a different assortment of games. But usually, if multiple sites have the same owner, the game selection and almost everything else will be about the same from one site to the next.
How Do Online Casinos Work?
Most online casinos do offer traditional casino games like blackjack and slot machines. They use various brands of software to power these games—it's rare (but not unheard of) that a gambling site will create its own proprietary games. These games are all powered by a computer program called a random number generator (RNG).
A random number generator is a computer program that generates literally millions of numbers per hour. When a bet is placed, the RNG stops at whatever number it's at that microsecond, and that number corresponds to an outcome (usually a win or a loss).Read more about random number generators
Random number generators have been used for years in brick and mortar casinos to power slot machine games and video poker games. But even a roulette wheel, a deck of cards, or a pair of dice could be considered a random number generator of sorts, albeit a low technology version.
Of course, in the case of slot machines, no one in a casino knows what the odds of certain symbols appearing are. This makes the payback percentage for such games impossible for the player to calculate, although you can be sure that the casino and the manufacturer of the game know that number within a couple of percentage points.
But wait, what's a "payback percentage"?
That's the amount of money that a player can expect to win back on each bet over the long run, mathematically.
A slot machine at the airport in Las Vegas has been programmed with such symbols and payouts that it's payback percentage is 75%. This doesn't mean that you'll win 75 cents for every dollar you put in. Such a game would become dull in the extreme quickly, and no one would play.
The game instead offers larger wins on a rarer basis along with smaller wins more often. Over time, the casino expects to keep 25 cents of every dollar wagered, but that's a long-term expectation. That's why, in the short term, players can and do win, at least some of the time.
Other casino games have payback percentages that can be calculated by the educated player. These are games in which the odds of getting a certain outcome are clear. For example, we can calculate exactly how likely it is to roll a 7 or 11 on a pair of dice. We know exactly how likely it is to get a ball to land in a red slot on a roulette wheel. We know the odds of being dealt an ace on the next card if we're holding a 10.
Legitimate Internet casinos duplicate these known odds. For example, if you're playing online craps at a safe and trustworthy site, you'll have the same odds of rolling a 7 or an 11 as you would if you were throwing a pair of real dice. If you're playing blackjack, you'll have the same probability of being dealt a blackjack as you would have if you were playing with a real deck of cards.
Some casinos, though, are a little bit disingenuous about such things. We know of one casino which offers games which look like video poker and blackjack, but the probabilities of winning on those games are determined via an inscrutable random number generator that works just like a slot machine's. That's because this particular operator offers a progressive jackpot on their entire suite of games, and to duplicate the odds of winning that jackpot using actual odds from a deck of cards would skew the payback percentage in favor of the player.
As long as you're aware of the difference, such activity isn't really fraudulent. Casinos don't need to "rig" their games. All casino games offer the house a mathematical edge over the player. Further rigging of the games just isn't needed to ensure profitability.
But occasionally you will run into a casino which has rigged its software. We read of one instance where a video poker player never hit a paying hand over the course of several hundred (or it might have been several thousand) hands. The odds of that happening are infinitesimal—lower than the odds of actually winning the lottery, in fact.
Word gets around quick among gamblers in the Internet gambling community, too. Such activity is short-sighted. It might generate some quick cash in the short term, but a casino can make a lot more money offering a fair game and keeping a large stable of customers happy.
In terms of how it works from a practical perspective, online casino gambling is actually pretty intuitive. You're required to open an account before playing games for real money. This involves inputting the usual kind of information you'd expect, like your name, address, and phone number.
Just registering with this info is usually enough to enable you to play the free games at an online casino. But if you want to play for real money, you have to deposit money into your account first. Most players just use a credit card for this, although they sometimes run into difficulties with credit card companies declining charges. And in some countries (like the United States), transferring money for the purposes of online gambling is a federal crime, so payment processors are reluctant to transfer funds for that reason, too.
Other options for getting money into your online casino account include e-checks, which work just like regular checks, only electronically, online wallets, which work in a similar manner to PayPal, and cash transfers, like Western Union and Moneygram. If you're having trouble deciding how to fund an online casino account, the customer service team at any legitimate property will be delighted to help you figure out your best option.How to deposit at gambling sites
Free Casinos vs Real Money Casinos
Earlier we mentioned "free casinos" and "free game sites". These exist, too, in various forms. The form we're most concerned with is the option of playing free games at a casino which also offers its games for real money. Almost all online casinos offer this as an option. Their goal is to motivate you to sign up and play for real money. That is how they make their money, after all. And they've decided that one of the best ways to get a player to play for real money is to let her play for free first.
Not all games at an Internet casino are available to play for free. One of the most common exceptions is the progressive jackpot slot machine game. When you run into one of those, it's very unusual to be allowed to play for free. It has something to do with how the games feed into the huge jackpot.
Other sites limit themselves to offering nothing but free games. These websites usually offer no download slot machine games, but we've seen sites which offer free versions of various card games like blackjack and baccarat, too. Most of these sites make their money by delivering advertising to their users. Sometimes they're advertising real money casinos, but any advertiser who wants to get his brand in front of a lot of eyeballs might be a good candidate for advertising on such a site.
Free casinos can be a fun way to practice the various games and learn how they work before playing them for actual cash or in a real, live action casino. And if you're broke and just looking to while away some time, they can make for an entertaining diversion. We've found that free slot machine games are boring as can be when there's no money on the line, but we know players who can't get enough of them.
As with most endeavors in life, your mileage might vary considerably from ours. That's just the way of the world.
But for us, the excitement of gambling comes from the possibility of winning (and losing). With nothing on the line, playing an Internet slot machine is just an exercise in watching some animation. We'd prefer something with a storyline if we're going to do that. (The Iron Giant and The Incredibles are two of our favorites, in fact.)
Internet Gambling vs Brick and Mortar
The differences between gambling at an online casino and gambling in a traditional brick and mortar casino are fewer than you might think, but some of them are significant. Like anything else, gambling online has its pros and cons.
Here's some information on the main differences between playing casino games online and in a land based venue.
One advantage to playing online is that you don't have to get dressed or travel. Depending on where you live, traveling to a brick and mortar casino can be quite an endeavor. But no matter where you live, you can usually get to your laptop or a mobile device by walking a few feet. And you can do this in your underwear, and no one will know or care.
Another advantage to playing online is that you don't have to deal with other people. We're extroverts, so we enjoy the masses of people at a brick and mortar casino. But we have introvert friends who'd rather avoid people and get their gambling in when no one is watching. Neither attitude is better than the other. But one means of approaching the activity is a better fit for certain temperaments.
We enjoy the perks of playing at a live brick and mortar casino. We like being brought free drinks by scantily clad cocktail waitresses. We also enjoy free meals and free show tickets. You can get perks similar to this when playing at an online casino, but it's usually not the same. Most Internet gambling sites prefer to just deal with free bonus money, because it doesn't require nearly the amount of effort that buying a show ticket might.
Also, when it comes to casino comps, it's easy to forget that these rewards are cheaper for the casino to provide than their retail price. It might cost you $20 to eat the buffet, but the casino only has to pay the wholesale cost for the meal, which is probably closer to $5. Casinos own all the seats to a show already, so unless the show is sold out, providing free show tickets doesn't cost the casino anything at all—even though those tickets might retail for $100 or more.
Most of the games on the Internet work exactly the same way, but there are some minor exceptions. For example, you'll never find an Internet blackjack game where you could get an edge by counting cards. That's because the software powering the games shuffles the deck after every hand.
Here's another example:
Some players are convinced that they can alter the outcome of a craps roll via skilled dice setting and throwing. It's obvious that when playing craps online, you can do absolutely nothing about the outcome of the two dice.
But when it comes to other games which involve no skill at all, like baccarat or roulette, the game works almost exactly like it would in a traditional brick and mortar setting. A 1 in 38 chance of hitting a number at roulette is a 1 in 38 chance of hitting that number, regardless of whether or not you're playing on a computer screen or in person.
One other major difference involves betting limits. Most Internet casinos have lower maximum betting limits than their brick and mortar counterparts. High rollers can get exceptions, especially when they're dealing with well-funded, large sites like Bovada. But generally speaking, if you want to bet $10,000 per hand of blackjack, you're going to need to visit a real Vegas casino to do so. (And by "Vegas casino", we mean a casino with that style, rather than a specific geographical location.)
Online Casino Bonuses and Promotions
Another major difference between online casinos and their land-based counterparts is the existence of "casino bonuses". These are incentives for new players to sign up at a site. They take the form of free chips or gambling money that you can wager on the games available.
A common type of offer might be a 100% matching bonus of up to $3000. That means that when you buy in to the site for $3000, they put an extra $3000 in your account. Your total gambling bankroll is $6000 instead of $3000.
It's not unheard of for land-based casinos to offer similar promotions, but not on this scale. Online casinos do it all the time. In fact, we don't know of a single Internet gambling site which DOESN'T use this as a promotional method to incentivize new players. It's that ubiquitous a practice.
Some, but not all, Internet game sites offer no deposit bonuses. These usually take the form of a free $25 chip (or less) that can be used to wager on slots or other games. No deposit bonuses are all upside, as you don't have to make a deposit to take advantage of them.
All casino bonuses come with a catch, though. Casinos use different names for this catch, but the most common phrases include "wagering requirements", "playthrough requirements", or "rollover requirements".
They require you to gamble your deposit plus the bonus amount a certain number of times before you're allowed to cash out. This gives them a chance to whittle away at your bankroll via the house edge. It also eliminates the possibility of taking that bonus amount and running away with it.
They also limit wagering on certain games for the purposes of meeting these requirements. To explain further, we'll use an example. Imagine the following scenario.
We'll assume that you're going to stick to the casino's slot machine games. This is a safe assumption, since most Internet casinos disallow wagers on most other games for the purposes of meeting your wagering requirements.
You don't know what the house edge or payback percentage is on this casino's slot machine games, but the casino does. For illustration purposes, we'll assume that the house is playing with a 25% edge and has a 75% payback percentage.
Putting $180,000 into action is easy enough. An average slots player makes 600 spins per hour. If you're betting $3 per spin, you're putting $1800 per hour into action, which means you'll achieve your $180,000 in wagering goal in about 10 hours of play.
But the casino has a mathematical expectation of keeping 25% of that $180,000. That's $45,000.
Of course, that's more money than you have in your bankroll, which is the entire point. You COULD get lucky and wind up profiting in this situation, but it's unlikely as well. The odds are stacked in favor of the house, big-time.
On the other hand, let's assume that the casino has lost its mind and allows wagers on blackjack to count toward the fulfillment of your wagering requirements. A player using perfect basic strategy faces a 1% edge. 1% of $180,000 is only $1800, so the player would expect to have $4200 after fulfilling her wagering requirement. Since she deposited $3000, she would have an expected profit of $1200.
Now you know why online casinos limit which games you're allowed to play in order to achieve your wagering requirements.
At one time, during the glorious early days of online casinos, smart advantage players could take advantage of casino bonuses to actually earn a little bit of money. In those days, they didn't have much in the form of wagering requirements, and they didn't restrict many games. But it didn't take long for the casinos to wise up.
We have a friend who took advantage of signup bonuses at multiple properties to put together enough cash t buy a jukebox for his game room. That was 15 years ago, though. Good luck pulling that off today.
The nicest thing we can say about casino bonuses is that they do give you the opportunity to spend more time playing the games and enjoying your gambling experience. But in any gambling game where you don't have the edge, the longer you play, the more likely you are to see results which mirror the actual math behind the game.
And the math always favors the house in the long run.Read more about casino bonuses & rewards
Who Plays for Real Mony at Online Casinos & Why?
Gamblers of all kinds play for real money at online casinos. The reasons are obvious to most people who like to gamble. They play for the opportunity to buck the odds and win some money.
Some are blackjack players who enjoy the mental challenge of making the correct decision over and over again. Since they face such a low house edge, they also stand a better than average chance of walking away a winner.
Video poker players often have a similar disposition to blackjack players. They just have a different "poison". Think of it as the difference between someone who enjoys tequila as opposed to someone who enjoys whiskey. Both are drinkers, and both probably drink for the same reasons.
Others are slot machine players hoping for a big score. These players have temperaments resembling those of lottery fans. We're not fans of slots in general, but we know many players who are, and we don't judge. Again, it's more about temperament than anything else.
At the end of the day, no matter what game you play, you're hoping to get lucky and win some money. You understand that the odds are against you, whether you prefer blackjack or slots, and you play anyway.
But not all gamblers have a healthy attitude toward their activities. Research has shown that gambling activities can stimulate the same parts of the brain that are stimulated by drug use. Addiction is a real issue that many gamblers face.
If you have impulse control problems, or if gambling has been a problem for you, playing online is probably just going to make those problems worse. We don't recommend online casinos to players who have any kinds of problems of this nature. Gambling addicts don't gamble in moderation, even though they keep trying to.
Smart gamblers view casino gambling as an entertainment expense. They know they can't win in the long run, so they never play with money they need for other purposes. Only a fool tries to double her money betting black at roulette with cash she needs to pay her electric bill.
Self-knowledge is the first step in addressing a gambling problem. Take a long hard look at yourself and your activities before deciding to embark on an Internet casino hobby. And remember that self-knowledge is only the first step. When it comes to addictions, other steps are usually necessary to restore sanity to one's life.
What are "Casino Games"?
Not all gambling games are casino games. Poker, for example, is a gambling game, but it's usually played against other players, not the house. The casino makes its money by taking a percentage of each pot, or, in some cases, charging rent for the time each player spends sitting at the table. That's called "the rake".
Betting on sports isn't really a casino game, either, although you are playing against the house (sort of, anyway). Any bookmaker of any size which accepts a lot of action takes money on both sides of a bet. They're usually paying off the winners with money they got from the losers. They make their money from the "vig", which is the extra money you have to put down when placing a bet. In most even money sports bets, you have to risk $110 to win $100. That extra $10 is where the bookie makes his money.
The house edge is not a complicated concept, and it's easily illustrated. The basic idea is that all casino games offer a player the chance to bet on a specific outcome. The odds of winning that bet are always lopsided when compared to how much you win.
Roulette is always a good example of how the house edge works. An American roulette wheel has 38 numbers on it. 18 of them are black, 18 are red, and 2 of them are green.
The most basic bet at a roulette table is a bet on black or red. It pays out at even odds – 1 to 1. But the odds of winning that bet aren't even. 20 times out of 38, you'll lose. You'll only win 18 times out of 38 in the long run. Those extra 2 losses are where the casino makes its money.
It's important to remember, too, that the house edge only operates over a large number of trials. When you're operating a casino, you have players putting money into action constantly all day every day. The numbers work out for you.
If you're an individual gambler, though, you can sometimes defy the odds in the short run. That's why we all know people who claim to come home having won at least a couple of hundred dollars every time they visit the casino.
Some of that is confirmation bias, too. They remember the wins better than they remember the losses. They get so much entertainment from playing these casino games that their brain looks for reasons to justify their continued play.
But here's how the math works.
- The longer you play a game with a negative expectation, the more likely you are to lose.
- The longer you play a game with a positive expectation, the more likely you are to win.
Casino games, with rare exceptions, always offer a player a negative expectation. Some video poker games might, when combined with promotions, offer a small positive expectation. Skilled card counters can get an edge at blackjack.
But it's far harder to make a living as a professional gambler than most people think.
Is it Illegal to Gamble at an Online Casino?
It's illegal in the United States to operate a gambling scheme. That means it's clearly illegal for you to run an online casino. You can find exceptions in states like Delaware, Nevada, and New Jersey, but even there, you're required to have a license to operate an Internet gambling site. Those licenses are expensive and hard to get.
It's also illegal to facilitate the transfer of money for purposes of illegal gambling. That's a federal law, so it applies throughout the entire country. This is a relatively recent law called UIGEA, the Unlawful Internet Gambling Enforcement Act. It's commonly misunderstood to have made it illegal to gamble online, but that's not the case at all.
Law enforcement from the federal government used to claim that the Wire Act applied to online casino gambling, but they've since reversed their position on this.
But many (if not most) states have laws making it illegal to gamble online. Some states, like Washington, even make it a felony. It's a fair question, then, to ask how likely it is to be prosecuted for gambling at an online casino.
Based on our research, it's unlikely in the extreme to face prosecution for placing a bet on black at a roulette wheel on a real money casino site. We've found no cases where someone faced legal action for such an activity.
Law enforcement in the United States has always focused on prosecuting the provider of illegal services rather than the customer. The police would always rather arrest a drug dealer than a drug user, a hooker rather than a john, or a speakeasy owner rather than a drinker there. That being said, it's impossible to guarantee that you won't face legal action if you gamble online.
In fact, our advice to U.S. players is to always obey the laws where you live.
Other countries have more clear-cut and reasonable laws regarding online gambling. For example, all forms of Internet gambling are legal in the United Kingdom. Citizens there have the pleasure of doing business with these companies in the open, and they have protections in the form of licensing and regulation that Americans' don't have.
Of course, there are over 200 different countries in the world. Each of those has its own federal laws. Most of those countries also have smaller jurisdictions, and laws vary in those smaller jurisdictions, too.Guide to online gambling laws
Online Casino Reviews
You'll find dozens (if not hundreds) of sites offering "online casino reviews". You should know that most of these sites don't have your best interests in mind. The online gambling industry is a lucrative one, and online casinos offer generous commissions to people who refer them customers.
And that's why most so-called "online casino reviews" are so positive.
The publishers of these sites have a financial incentive to say nice things about the sites they're reviewing.
We try to take a broader view of things. We feel like offering real reviews with an honest assessment of the pros and cons of the casinos will bring us more business in the long run. Most information site owners are more short-sighted than that.
It's easy to understand why. Writing lengthy, detailed, even-handed reviews takes time and costs money. Higher costs generally reduce the ROI on a business activity.
When (and if) you start trying to decide where to play, maintain a skeptical eye when you're doing your research. Look for clear and obvious contact and about information on the site—those are usually signs that the owners aren't necessarily just out for a quick buck.
You should also discount any review that reads more like an advertisement than an actual review. Reviews written in the first person are often more trustworthy than reviews written in the third person, for example. (The writer uses the word "I" when writing in first person.)
One funny aspect of fake casino reviews to watch for is the numerical rating scheme. You'll occasionally see an online casino review that provides a rating to a site with multiple decimal places. But let's face it. Online casinos aren't that complicated. How could you distinguish between a site with a rating of 9.97 and a rating of 9.95? That's just ludicrous. The owners of those sites probably read somewhere that more specific numbers make their writing more credible.
In fact, if you find a site with such numerical ratings, compare the ratings from one casino to the next. It won't take you long to realize that all the casinos on a particular site have high ratings (9+). That's a clear red flag that these aren't legitimate reviews.
Online casinos for real money are big business. But knowing how to choose one at which to play isn't as intuitive or as easy as one might initially think. The legal issues can be thorny, too, especially if you live in the United States.
Luckily, we have dozens of pages with real casino reviews on this site you can refer to. We also cover specific games and strategies so you can get the most bang for your gambling buck. Spend some time browsing through the pages on our site before leaping into the online casino hobby.
You'll be glad you did.
Author: Brad Johnson
Updated: March 2016
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