Tidying Up the iGaming Landscape
Virginia lawmakers are weighing one of the biggest gambling expansions the state has ever seen. But this isn’t just about adding online slots and poker tables. It’s also about cleaning the house.
A newly introduced bill in the Virginia General Assembly would authorize regulated online casinos and poker, while sharply tightening the rules around online sweepstakes gaming. The message is clear: if Virginia is going to allow real-money gambling online, it wants it licensed, taxed, and tightly controlled.
What the Bill Actually Does
House Bill 161 (HB 161), prefilled on January 6 and set for formal introduction on January 14, would authorize regulated internet casino gaming in Virginia. It’s the most comprehensive iGaming proposal the state has considered since legal sports betting launched.
If HB 161 passes, Virginia wouldn’t be dipping a toe into online gambling. It would be going all in.
Licensed operators would be able to offer a full menu of online casino games, from slots and table games to online poker and live dealer titles streamed from licensed studios. And it doesn’t matter whether those studios are located in Virginia or elsewhere.
The entire system would sit under the Virginia Lottery Board, using rules that are similar to the state’s existing sports betting framework. The goal here isn’t experimentation, it’s control. Virginia aims to bring online gambling fully into a regulated, supervised environment, making it safe for players.
Who Gets to Run Online Casinos
HB 161 doesn’t open the door to everyone.
Under the bill, only licensed land-based casino operators in Virginia would be allowed to offer online gaming. Each casino could run up to three separate online platforms, with one brand per platform, plus an additional standalone brand dedicated to poker.
Getting in wouldn’t be cheap. Operators would need to pay $500,000 for a five-year license, along with a $2 million notice-of-intent fee for each platform and a $1 million renewal fee down the line.
Taken together, the structure sends a clear message: this market is designed for established, well-capitalized operators, not casual entrants or gray-market platforms that are looking to slip through the cracks.
Taxes, Revenue, and Why Virginia Is Doing This Now
HB 161 would tax online casino revenue at 15%, with payments made monthly. How that money is split is a big part of why the bill exists at all
A portion would be set aside specifically for problem gambling programs, with 5% directed to the Problem Gambling Treatment and Support Fund. Most of the remaining revenue would flow to the general fund, while 6% would be routed to a new Internet Gaming Hold Harmless Fund through 2030, designed to offset potential revenue losses at brick-and-mortar casinos tied to online play.
For lawmakers, that revenue structure helps tackle two of the biggest concerns that have slowed iGaming efforts in the past: addressing problem gambling and protecting the state’s existing casino industry.
The Sweepstakes Angle
HB 161 doesn’t just open the door to online casinos, it also closes it firmly on most sweepstakes gaming.
Under the bill, paid online sweepstakes would be illegal in Virginia unless they’re run by a licensed iGaming operator. Any platform that lets players exchange something of value for a shot at cash or cash-equivalent prizes would be treated as illegal online gambling if it isn’t licensed.
And the penalties are real:
- Up to $100,000 for a first violation
- Up to $250,000 for repeat offenses
- Each day of operation counts as a separate violation
Enforcement would be handled by the Virginia Lottery Board, the Attorney General’s Office, and state police. The bill also introduces felony charges for unlicensed internet gaming and for tampering with gaming software or systems, exposing operators to serious criminal penalties, including potential prison time.
For sweepstakes operators, this isn’t a gray area or a gentle nudge. It’s a clear line in the sand.
Why Sweepstakes Lose Leverage Once iGaming Is Legal
Sweepstakes casinos tend to thrive in states without legal online casinos. Their core argument that players don’t have a legal alternative, loses force once licensed iGaming enters the picture.
HB 161 changes the political math. Once Virginia offers regulated, taxed online casinos with consumer protections, tolerance for gray-area gaming models drops sharply.
That’s a pattern we’ve already seen in states with legal iGaming. Regulation doesn’t coexist easily with ambiguity.
A Long Road, Not a Fast One
Even if HB 161 advances, this isn’t something that flips on overnight.
Under the bill, the Virginia Lottery Board wouldn’t finalize regulations until September 30, 2026. Operators couldn’t even begin filing notices of intent until July 1, 2026.
And Virginia’s history matters here. Previous efforts to legalize online casinos have gone nowhere, usually bogged down by concerns over regulation, problem gambling, and whether the state’s land-based casinos were ready for the shift. HB 161 is the first proposal that tries to address all of those issues in one comprehensive package.
What Happens Next
HB 161 is still early, and passage is far from guaranteed. But the message is clear.
Virginia is weighing a tradeoff many states are already making: expand regulated online gambling, and close the door on sweepstakes at the same time. If the bill moves forward, it would reshape who can operate in the state, and how they get to operate.
Whether or not HB 161 becomes law, the direction is hard to ignore.
Blaise Luis
