For more than 12 years, The United States has operated under the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA). While the law doesn’t forbid online sports gambling, it does make it illegal for offshore sports books to transact business with US citizens through credit card transactions. For a lot of Americans, that has served to be an adequate deterrent from online sports gambling.
The US Supreme Court Steps In
With as much as $150 billion in annual sports gambling revenues on the line, the Supreme Court has taken the first step towards legalizing online sports gambling in the US. In May of 2018, the higher court ruled previous laws that prevented any type of sports gambling were unconstitutional. Effectively, this throws the decision to allow sports gambling to the state level where each state government can make a determination on behalf of its own citizens.
Within the first three months, two states have legalized the operation of brick and mortar sports books within the state’s boundaries. Those states are Delaware and New Jersey. The join Nevada as the only states were sports gamblers can legally place bets. It’s worth noting that several states like Pennsylvania and Mississippi also have legislation going through it state legislatures. With lucrative tax revenues in the offering, it’s a good bet most states will legalize sports gambling by the end of 2019.
The Next Step Towards Online Sports Gambling
For now, sports gambling is only legal in brick and mortar sports books. Most US sports books are affiliated with land-based casinos or popular horse racing venues. Soon, stand alone sports books, much like UK bet shops, should begin popping up in properly zoned areas.
The steps that have been taken for sports gambling enthusiasts are promising. However, there’s still billions of dollars leaving the country through offshore online sports books. Remember, the UIGEA is still in effect, which makes it illegal for US citizens to make deposits into their betting accounts via credit cards. The work-around has been for highly motivated sports gamblers to simply use e-Wallets and PayPal through offshore sports books licensed in Antigua and Curacao.
At this point, it looks like its just a matter of time before US online sports gambling comes to the US. Over the last couple of years, four states (Delaware, Nevada, New Jersey and Pennsylvania) have already legalized online casino gambling. With such laws already in place, it shouldn’t be long before those laws are changed to include online sports gambling. Again, there’s too much at stake and most states are in dire need of tax revenues, making the gaming industry a lucrative target.
To be fair, the legalization of online sports gambling will face several major issues. First, the online sports book operators will have to comply with a long list of regulations. Those regulations will have to be addressed one-by-one since each state is going to maintain its own regulatory body. That’s potentially 50 sets of rules an online sports book operator is going to have to address.
Another possible obstacle could be negotiations with the sports leagues themselves. For decades, the NFL, NBA and MLB fought against the legalization of sports gambling over league integrity concerns. It now appears the leagues are prepared to relent, but there will be a cost. The cost figures to include some type of revenue sharing deal, plus funding to help monitor integrity issues within sports. At the end of the day, both these issues will be addressed, and something will be put in place. Sports gamblers will just have to remain patient for a little while longer.
Once all the legalities have been set aside, the US figures to become the largest online sports gambling purveyor in the world. Unlike Europe where European football (soccer) reigns as the supreme king over sports, much of the sports betting attention in the US will be focused on the National Football League (NFL). Some estimates indicate that NFL gambling revenues exceed that of all other sports options combined. Those options would include Major League Baseball (MLB), the National Basketball Association NBA), the National Hockey League (NHL) and major college sports.
In recent years, the typical American sports gambler has shown an openness to betting on sports like Golf, Tennis and even soccer. These entire options figure to be offerings made available through US online sports books.
Sports Book Operators
For more than 20 years, offshore sports book operators have longed to claim a portion of the US sports gambling market. It’s a good bet that many of the worlds top bookmakers (Paddy’s, William Hill etc.) are ready to throw down the gauntlet. However, US casino operations figure to have a major say about what happens within the US market. Remember, a big part of the motivation for allowing any form of sports gambling is to bring in tax revenues on both the state and federal levels. It’s an equally good bet that the States will become very jurisdictional, protecting its own revenue as opposed to letting tax dollars flow into other jurisdictions.
The most likely solution will involve US operators partnering with the well-established betting houses in Europe. The attraction is the high level of government control set forth by regulatory bodies like the UK Gambling Commission and the Malta Gaming Authority. In fact, it wouldn’t be much of a surprise to see a few states model its online sports gambling guidelines after what these two agencies have already developed. There’s no sense in try to reinvent the wheel.
In the coming months, Sports betting fans can look for updates related to current online sports betting laws. In good time, everyone should be able to place bets right from their computers and smart phones on sports events being played all over the world. Given the ease of access, it wouldn’t be shocking to see online sports gambling revenues exceed expectations by a significant amount. We ask that you keep checking back with us for updates that will be occurring in the coming months.