Gambling and online casinos in Micronesia

The Federated States of Micronesia is a Pacific state that includes four autonomous regions: Yap, Chuuk, Pohnpei and Kosrae.

The country is known for its picturesque atolls and developed sea tourism,

but in the field of gambling, Micronesia remains one of the most conservative countries in Oceania.

The legislation does not provide for either licensing or a ban on gambling,

which means that gaming activity is in the "gray zone":

• officially no casino exists, but access to offshore online platforms is open.

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Historical context

Gambling in Micronesia was never part of the economy or culture.

After independence from the United States in 1986, the country concentrated

on the development of tourism, fishing and foreign trade.

Unlike neighboring island states such as Palau and Vanuatu,

• Micronesia did not develop offshore licenses for eGaming,

fearing a negative impact on society and the country's reputation.

However, in recent years, interest in the digital economy

• and cryptocurrency projects causes a new wave of discussions about the possible legalization of online gambling,

especially as a source of revenue for the budget and tourism.

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Legislation and regulation

There is no separate gambling law in Micronesia.

None of the four states of the federation (Yap, Chuuk, Pohnpei, Kosrae)

has no regulations governing gambling.

Key facts:

• there are no licenses for casinos and bookmakers;
• participation of citizens in online betting is not prohibited;
• gambling advertising is unregulated;
• the state does not levy taxes on gambling operators.

The main source of legal control remains the Criminal Code of the Federated States of Micronesia (1979),

where gambling is not directly mentioned.

Thus, the country actually adheres to a neutral position:

• gambling is not supported, but it is not pursued either.

Government - Ministry of Justice and Ministry of Finance -

• control only financial transactions and Internet traffic,

without interfering in the activities of offshore operators.

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Online gambling

Due to lack of national casinos

residents of Micronesia play mainly on foreign online platforms.

Internet gambling is becoming more and more accessible

thanks to the development of satellite Internet and mobile networks.

Popular destinations:

• online slots and roulette;
• sports betting and esports;
• crypto-gambling;
• live dealer games.

International sites popular with Micronesians:

• Stake. com
• 1xBet
• 22Bet
• BC. Game
• BetWinner
• Fairspin. io

Ways to pay:

• international payment systems (Skrill, AstroPay, Perfect Money);
• cryptocurrencies - Bitcoin, Ethereum, Tron, Tether (USDT);
• mobile wallets operating through Asian gateways.

According to Pacific iGaming Outlook 2024,

about 18% of Micronesian adults have participated in online gaming at least once,

and the shadow market turnover is estimated at $7-9 million per year.

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Economic context

Micronesia remains a country with limited sources of income.

The economy is based on international aid, tourism and fishing.

The gambling industry is not yet seen as a priority,

• however, experts note the potential for the creation of an offshore eGaming sector

according to the model of Vanuatu and the Marshall Islands.

Possible benefits of legalization:

• attracting foreign investment;
• creation of new jobs in the IT and legal sector;
• increase in budget revenues (up to $5 million per year);
• development of tourist casinos and online venues under state control.

Local authorities are already discussing the idea

• introduction of a digital license for online gambling,
• aimed at foreign companies,

which will allow Micronesia to enter the list of offshore eGaming centers.

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Social and cultural context

The population of Micronesia adheres to the traditional way of life,

and most of the inhabitants profess Christianity.

Therefore, society is wary of gambling,

especially to the idea of opening casinos domestically.

Individual clerics and politicians are calling for market regulation,

• to prevent gaming addiction

and protect users from fraud.

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Cryptocurrencies and the digital economy

Micronesia is among the countries supporting crypto initiatives

and considering blockchain as a tool for economic growth.

In 2022, the Ministry of Finance announced

on the development of the Micronesia Digital Economy Vision strategy,

• which could potentially include crypto gambling

as an export service for foreign players.

Key areas:

• creation of offshore eGaming licenses;
• the use of cryptocurrencies and stablecoins in calculations;
• smart contract integration for transaction transparency;
• participation in the Pacific Blockchain Network.

This could make Micronesia one of the first countries in the region,

• where the state officially recognizes digital gambling

part of the economy.

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Prospects

Micronesia has all the prerequisites for becoming

regional center eGaming and crypto gambling.

The main obstacle is the lack of a legal framework and investment.

Possible steps until 2030:

• the adoption of the Micronesia Gaming Regulation Act;
• the establishment of the National Gaming Authority;
• issuance of offshore licenses for online operators;
• developing partnerships with Asian companies;
• creating a "Digital Gaming Zone" in Pohnpei or Yap.

Forecast: when legalizing online gambling

Micronesia's market turnover can reach $30-40 million per year,

primarily due to foreign eGaming companies.

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Micronesia is a country without an active gambling market,

but with the potential to become part of a global digital industry.

Lack of bans and growing interest in cryptocurrencies

provide the basis for future legalization of eGaming.