The UIGEA was passed in 2006 and was NOT DEBATED IN CONGRESS FOR ONE SECOND. It sent banks into a defensive mode where they would no longer consider transactions for online poker. Online poker wasn't specifically identified as illegal, but lumped into gambling, a category banks feared to process. This consequence removed liquidity in the online poker world. Poker players need access to their bankrolls to be made available online to play through the swings and now players were forced to get find another way. Some traded cash for online money in unfavorable circumstances or went through some other 3rd party processor that was or wasn't legit(how could you know) in order to keep playing. How to deposit online became a much bigger issue. Several sites left the US and few remained. Given fewer options of sites to play on for US players a few things happened. Serious players had an increased need to have more money sitting in an online account because of the inability to deposit. Poker has swings and you need money to earn in case you have none. Fewer sites and now an increased need for money to be kept into these accounts likely created a windfall amount of cash to be kept on sites like Full Tilt Poker and Pokerstars.
We may never know is how many excess dollars were held in the Full Tilt Poker system by players that feared the illiquidity, but it did happen because of the UIGEA. Did these excess funds in the system contribute to the wild bonuses/dividends/ownership payouts that we are now hearing about or an inflated value of the company? We may never know, but I like to think I kept 500% more money in my account than I would have ever kept if this law didn't remove the ability to deposit what I needed to play for that day. Why would anyone ever take 0% interest in an online poker account instead of using a pay as you go system? We all took our own individual risk in this scenario to earn money or play for fun or whatever your motive, but it would not have been there with proper regulation or even in absence of the UIGEA.
So now a law attached to a Port Security bill probably meant to get some corrupt politician re-elected has in some way contributed to this Ponzi scheme. I can call for more regulation of online poker in the United States, but it's far too late. Instead of doing their job, Washington was more concerned with getting elected and passing bad policy to do so. 5 years of tax revenue and regulation would have gone a long way to preventing the pain many poker players are now feeling.
