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 marine 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 gaining independence from the United States in 1986, the country focused on developing 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.

Nevertheless, in recent years, interest in the digital economy and cryptocurrency projects has caused a new wave of discussions about the possible legalization of online gambling, especially as a source of income 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 the 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 Micronesia's adult population has participated in online games 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 considered a priority, but experts note the potential for creating an offshore eGaming sector based on 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 of ​ ​ introducing 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 the idea of ​ ​ opening a casino within the country.

Individual clerics and politicians are calling for market regulation to prevent gambling addiction and ensure users are protected from fraud.

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Cryptocurrencies and the digital economy

Micronesia is among the countries that support crypto initiatives and see blockchain as a tool for economic growth.

In 2022, the Ministry of Finance announced 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 as part of the economy.

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Prospects

Micronesia has all the prerequisites for the formation of the regional center of 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: with the legalization of online gambling, the turnover of the Micronesia market 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 the global digital industry.

The lack of bans and growing interest in cryptocurrencies set the stage for the future legalization of eGaming.