US Lawmakers Propose Facial Recognition for Online Gambling Age Verification

A potential legislative change is emerging in the United States that aims to strengthen the protection of minors from online gambling and prediction markets. The bipartisan proposal, supported by prediction market operator Kalshi, calls for the use of facial recognition technology for user age verification. This step comes at a time when prediction markets face growing scrutiny over underage participation and a lack of federal standards.

Representative Josh Gottheimer, a Democrat from New Jersey, introduced the legislation on Wednesday. It would require online sportsbooks and prediction markets to use facial recognition technologies. These would need to estimate users' ages before they can place bets or execute trades. Gottheimer's office emphasizes that the technology would not store identities or biometric data.

Numbers and facts

Supporters of the "Facial Recognition to Protect Children Act" include Kalshi, the parents' advocacy group ParentsRISE, and a number of representatives from both parties, including Jeff Van Drew, Nick LaLota, and Kristen McDonald Rivet. Gottheimer expressed concern about the current situation:

"We're asking our kids to self-police their way past a system built entirely on the honor code. A kid can log into a parent's, an older sibling's, or a friend's account and place a bet with no verification at all." - Josh Gottheimer, Representative from New Jersey

Representative Gottheimer's office points to the rapid expansion of sports betting and the associated concerns about underage protection. A study by Common Sense Media found that 36% of boys aged 11 to 17 participated in gambling in the past year. In states like Iowa and Tennessee, there have been increasing reports of underage betting. In Tennessee, sports betting providers reported over 400 minor accounts in 2024, a significant increase from approximately 100 in 2023.

Background

Prediction markets have long been criticized for lower age limits. Unlike regulated online sportsbooks, which generally require a minimum age of 21, the limit for prediction markets is often 18 years. This creates a regulatory gap that allows younger users access to gambling-like products that would otherwise be unavailable, according to state regulators, addiction experts, and sports leagues such as the NBA. Kalshi CEO Tarek Mansour stated that protecting minors is "a top priority" for his company and called for age verification to become an industry standard. Kalshi has already introduced voluntary safeguards, including Face ID checks to prevent minors from accessing parents' accounts, two-factor authentication, and expanded selfie verification. The company has also pledged $2 million for player safety initiatives through a partnership with the National Council on Problem Gambling.

Gottheimer's bill aims to turn some of these safeguards into a nationwide standard for sportsbooks and prediction markets. This would mean that many online platforms would have to introduce technologies not currently part of their standard account verification procedures. While operators like DraftKings and FanDuel conduct KYC (Know Your Customer) checks and verify identity and age upon account creation, they typically do not require facial recognition for each login or wager. However, some states, such as Ohio and Pennsylvania, already mandate two-factor authentication for every login.

Why it matters for German players

The discussion in the US about biometric verifications is of high interest to German players, even if they are not directly affected. The German gambling market has been comprehensively regulated since 2021 by the State Treaty on Gambling (GlüStV 2021). This treaty introduced strict rules for online gambling providers seeking a license from the Joint Gambling Authority of the Federal States (GGL). The central goal is player protection, especially the protection of minors and addiction prevention. Unlike in the US, where age limits vary and prediction markets have their own rules, Germany has a uniform age limit of 18 for all gambling. A complete and comprehensive identity and age verification directly upon registration is already mandatory for GGL-licensed providers. Tools like LUGAS, the cross-state gambling supervision system, monitor compliance with monthly deposit limits of 1,000 euros and prevent simultaneous play at multiple providers. The stake limit of 1 euro per spin on online slot machines also serves player protection. Biometric procedures like facial recognition are not yet a standard requirement in Germany. The current measures are considered sufficient to protect minors and at-risk players. Nevertheless, American developments show which technologies are theoretically conceivable to further optimize protection.

What it means for GGL-licensed casinos

For online casinos with a German GGL license, the facial recognition requirements described here are not immediately relevant. The GGL relies on a combination of identity verification upon registration, Schufa comparison, video identification procedures, and the central exclusion system. These measures ensure that only adults have access. Although there is no daily biometric verification in Germany as discussed in the US, the LUGAS system and strict KYC processes are considered very effective. A direct implementation of North American biometric standards, while technically feasible, would require a legal adjustment to the GlüStV. Currently, there are no indications of this. However, I closely monitor new technologies discussed in other markets, as developments in youth and player protection are progressing rapidly. The demand for biometric controls could certainly encourage legislators in Germany to hold future discussions about adjustments. For now, the current requirements for GGL casinos remain in place.