The Rise of Sports Betting Across the United States
Sports betting has long been viewed as something nefarious. Unfortunately, it earned a bad reputation because of a handful of bad actors and an association with organized crime. While there were some problems, it never deserved the negative stigma.
All the false representations did was to make things worse. Finally, the US Supreme Court made a monumental decision to reverse the federal government's view of sports betting. Here is a history timeline, plus updates on which states have opened their doors legally to sports bettors.
Top Eight Mobile Sports Betting Apps
DraftKings Sportsbook – DraftKings was immediately ready to be highly competitive in the sports betting market as soon as it became legal. They had an established online presence with more than a million users when the big event happened in May 2018.
The app is a little heavy, but that's because DraftKings' app has a wealth of statistical information at the user's fingertips. There are some portions of the app that are distracting, but for statistics and analysis it is one of the best. DraftKings has also reported some of the highest revenue figures in the states where it has launched.
FanDuel Sportsbook – The FanDuel sportsbook app started slowly, but has since taken a lions' share of the mobile betting market. It has been the most successful app for total betting revenue in New Jersey.
FanDuel is currently taking mobile bets in New Jersey, Pennsylvania, West Virginia and Indiana. The app is smooth and fluid. Like DraftKings, FanDuel was already a presence in the DFS world. This brought thousands of users when they started the sportsbook app.
William Hill Sportsbook – William Hill brought decades of experience when it entered the US sports betting market. Their sportsbook app is user-friendly and functional. They offer an organized list of all active bets and categorize sports well. There are hopes they will improve their cash out options and add a wider range of in-game betting features.
Fox Bet Sportsbook – The Fox Bet Sportsbook app is part of the Stars Group of online gaming operations. There is an awards program that is part of the Stars Rewards. While they do not provide as much statistical analysis, the Fox Bet app is one of the smoothest operating sports betting apps available.
PointsBet Sportsbook – Like many of the other strong sportsbook apps, PointsBet is operating in New Jersey, Indiana and Iowa. It started with a partnership at the Meadowlands Racetrack in New Jersey.
PointsBet offers one of the more unique betting opportunities called PointsBetting. The Australia-based company has a simple interface and primarily targets betting on the major sports markets.
BetRivers Sportsbook – BetRivers is owned and operated by SugarHouse online. It is legal in Pennsylvania and Indiana. The mobile app is a design of Rush Street Gaming. They have one of the easier play-through requirements for new accounts and deposit bonuses.
888 Sports – 888 Sports has one of the better in-game betting platforms. While they do not offer as diverse an array of sports to bet on, they are one of the best apps for performance. The mobile app and desktop versions are essentially identical. They offer a variety of updated promotions and have earned an outstanding rating for customer service.
Monkey Knife Fight – Monkey Knife Fight is said to be where daily fantasy sports is blended with game predictions and odds. The contests are similar to DFS contents where players bet against the house instead of other players. The sportsbook app is unique in the sense that the bets differ from anything offered on competitor sites.
The States Where It's Legal to Bet on Sports
Presently, there are 13 states that have legal sports betting in some form. There are another six states that have passed legislation to make it legal. Four other states currently have active sports betting legislation on the floor. Here's a look at them all and what they currently offer.
New Jersey – As we mentioned, New Jersey launched in June 2018. Mobile apps were active before the end of the summer. The same Murphy in the federal lawsuit made the first official bet at the Monmouth Racetrack in Oceanport.
There are a growing number of sportsbooks in the state. Sugarhouse, William Hill and BetMGM are physical locations that have partnered with mobile apps. FanDuel, DraftKings, Fox Bet NJ and William Hill are four of the highest revenue producing online sportsbooks.
There are 14 mobile sportsbooks currently operating in New Jersey. They include the four mentioned above, plus Hard Rock, PointsBet, Resorts, Sugarhouse, theScore, BetMGM, Golden Nugget, Caesars, BetAmerica and 888 sportsbook.
Pennsylvania – A year after the US Supreme Court ruling, Pennsylvania opened six physical sportsbook locations in the Keystone State. Since sports betting became legal in Pennsylvania, there have been six mobile sports betting apps added.
Sugarhouse Sportsbook was the first to go live in May 2019. They were followed by the Rivers Sportsbook the next month and then FanDuel in July. Fox Bet launched their mobile app a little over a month later. The final two current sports betting apps launched in November, DraftKings and Unibet.
Mississippi – In Mississippi, the existence of physical casinos helped to make legal sports betting fly through with legislative approval. However, online sports' betting has found the going a lot rougher. As of December 2019, when a bill died without even a hearing, all sports betting is restricted to the physical casinos that have licenses.
West Virginia – The Mountaineer State made a push for legal sports betting to close 2018. Mardi Gras Casino and Wheeling Island were the first physical locations. Those operations have been temporarily suspended, but three options still exist.
One is through the Hollywood Casino, and the Greenbrier has licenses for the other two. The DraftKings Sportsbook app has partnered with the Hollywood. FanDuel and BetMGM are under the license of the Greenbrier, a private resort.
Rhode Island – The state of Rhode Island approved casino gambling as early as 2012. It was an easy step for them to become the eighth state to legalize sports betting. Currently, there are two physical sportsbook locations.
There is one at the Twin River Casino in Lincoln and another at the Twin River location in Tiverton. Online betting wasn't part of the original legislation, but the law has been expanded to include mobile betting in the very near future.
Delaware – Much of the attention went to New Jersey after the US Supreme Court ruling came down. However, Delaware was the first state to accept a wager outside of Nevada. They started legal sports betting in June 2019.
There are three physical sportsbooks operating in Delaware. Delaware Downs, Dover Downs and Harrington Raceway casinos all accept sports bets. While legal, there are no online mobile sports betting apps operating in the state.
Oregon – Oregon joined the states where you could legally bet on sports in August 2019. There was a lot of preparation already in place before the first bets were approved. Consequently, Oregon is one of the states with the most physical sportsbook locations, currently with 10.
While none of the name sportsbook apps are currently operating in Oregon, sports bettors can bet on games using the Scoreboard app through the Oregon lottery. There are a few restrictions in place that apply to college teams and major college events.
Nevada – When the US passed the PASPA in 1992, it was a windfall for Nevada. The state was essentially grandfathered in and quickly grabbed a monopoly on sports betting in the United States.
For Nevada, the 2018 court ruling did little more than provide competition. It's been business as usual for Nevada casinos and sportsbook apps, albeit a little less business. Until California decided to allow sports betting, Nevada will still attract a lot of cross state line bettors.
New Mexico – In New Mexico, a few tribal casinos are allowing sports betting under the Class III gaming compact. There are limited opportunities to date, but sportsbooks are beginning to appear at various tribal casinos.
Arkansas – Voters in Arkansas approved sports betting legislation in November 2018. Legal bets were opened on July 1, the following summer. Currently, there is a single physical sportsbook at Oaklawn Racing Casino Resort. However, three other locations have been approved pending an announced opening.
Iowa – The Hawkeye State legalized sports betting in May 2019, and went live two months later. There are a dozen physical sportsbook locations under the rules and guidelines established by the Iowa Racing and Gaming Commission.
Iowa also launched online sports betting at essentially the same time. Currently there are five sportsbook apps legal in the state. One is at the Hard Rock Sioux City, one in the Q Casino, and another at the Elite Casino. PointsBet and DraftKings also offer legal sportsbook apps in Iowa.
Indiana – The Indiana Gaming Commission began overseeing legal sports betting in September 2019. The Hoosier State launched the first brick-and-mortar sportsbook later that month and waited only one month to begin taking online bets in October.
There are more than a dozen physical sportsbook locations across the state, plus six current sportsbook apps. DraftKings, FanDuel, BetRivers, BetAmerica, BetMGM and PointsBet are currently taking bets online, with three more apps pending an announcement.
Illinois – Illinois approved sports betting in June 2019, but a launch date is still pending. There was hope that sports betting would go live by the 2020 March Madness, but the pending launch date has been temporarily delayed.
New York – The Empire State actually made sports betting legal at its commercial casinos in 2013. However, because of the federal law prohibiting bets on sports, the official legal launch date wasn't until July 2019.
At present, there are close to a dozen physical sportsbook locations, most of them in the Upstate portion of New York. All are associated with commercial casinos. While there is a strong urgency to allow online sports betting, you cannot bet using a PC or mobile device in the state.
History of Online Sports Betting in the United States
It wasn't so long ago that placing a bet on your favorite team or sport could land you in jail. Other than at a few select locations in the United States, bets on sports had to be made through illegal channels.
However disparaging it may sound, bettors and bookmakers were essentially criminals. The whole ordeal was the result of an aggressive federal assault on organized crime. Evidence seemed to point to sports betting being a lucrative source of funds, plus a way to launder monies from other nefarious activities.
The whole debate about the evilness of sports betting took a chin-shot in the early 1970s with a boom in statewide sponsored lotteries. However, nothing changed in the minds of legislators in relation to betting on sports.
What few discussions there were, it never made it out of committee. In 1992, the 102nd United States Congress put their stamp on sports gambling. The Professional and Amateur Sports Protection Act of 1992 (PASPA) outlawed sports betting across the United States.
Other than three sports lottery exemptions and the licensed sports pools operating in New Jersey, now it was officially a federal crime to bet on sports. This would be the status of sports betting in the United States for the next 16 years.
If you found a bookie and made a bet on a sports contest inside the State of Nevada, you could land in federal prison. During this period, there were states trying to make inroads into making the decision one for individual states to make, not the federal government.
One of those states was New Jersey. Financial analytics estimated that New Jersey was losing in the neighborhood of $600 million a year through losses of potential sports bets made at their legal casinos.
Through the efforts of former New Jersey Governor Chris Christie, a referendum was placed before the state's voters in 2011. It passed in a landslide. By 2012, lawsuits were abounding. Professional sports leagues were involved as well.
At the heart of it all was New Jersey. The case took a number of turns over the next five years. When New Jersey elected a new governor, the plaintiff in the federal case changed. It became known as the Murphy vs. the National Collegiate Athletic Association.
It was combined with another case brought by the New Jersey Thoroughbred Horsemen. Things began to really heat up in October 2016. At the heart of New Jersey's case was the basic idea of how much power the federal government had to regulate individual state laws.
On June 27, 2017, the US Supreme Court agreed to hear the case. Oral arguments concluded later that year in December. By May, there would be ruling that would change the landscape of sports betting across the United States forever.
In May 2018, the Supreme Court reversed a circuit court ruling and legislated in favor of New Jersey's lawsuit. The PASPA was ruled unconstitutional, and the 1992 law overturned. Suddenly, with the smack of a gavel, it became the choice of each state individually to determine if they wanted sports betting to be legal.
Needless to say New Jersey was ready to go. However, there would be some hurdles left to jump. One involved another federal law. In 2006, for much the same reason as the 1992 sports gambling ruling, the Unlawful Internet Gambling Enforcement Act was passed.
So, even though states could decide themselves on the legality of sports betting, lawmakers insisted they could not do it using any type of mobile device. Because of this law, online sports betting, even in states where legislation had passed, it could have been deemed illegal.
Even though the actual law passed in 2006, it would be five years before a monumental event created the worst fallout. The entire online gaming industry was smacked down hard on Friday, April 15, 2011. Online casino players refer to it as their version of Black Friday.
The courts officially call it The United States vs. Scheinberg. It brought federal charges against three of the biggest online poker business and a handful of their associates. At the forefront of the charges were bank fraud and money laundering.
In a historic legal move, the US Department of Justice yanked the internet addresses of three primary online casino sites. Bank accounts, including player funds, were frozen. It was a long and bumpy ride, but in July 2012, the US DOJ dismissed the charges with prejudice.
However, three high-ranking individuals did not escape prosecution of federal criminal charges. Sentences for the three individuals, including one banking official, ranged from three months to three years. No one appreciated how the final decision would affect sports betting six years later.
There was such a public outcry against what were referred to as strong-arm tactics that the eventual discussion about allowing online sports betting met with limited resistance. New Jersey passed their sports betting bill by a 73-0 margin.
Almost before the ink was dry on the legislation, online sportsbooks such as DraftKings and FanDuel were petitioning for a tie with a fixed casino. Having been a part of the daily fantasy sprts online industry made the joint ventures a smooth transition.
It was a long hard road to finally get a voice at the highest court in the land. Once there, the betting world was breathless in anticipation. They heard what they wanted, and the race to legalize sports betting began across the nation. Here's a look at the states that have already turned the corner and have legal sports betting operations.
Sports League Partnerships
One reason that sports betting has started so successfully in many places are the partnerships that have formed between sports leagues and betting operations. All four of the big professional sports leagues in the United States have some form partnership.
There have also been unions made between particular professional teams. Certain locations opened their sportsbook operations directly linked to an announced sports league partnership. The NBA and MGM Resorts International inked a $25 million three-year deal.
Caesars consumed their own private deal with the league's Philadelphia franchise. Currently, the 76ers are the only individual NBA team with a private deal. A pair of NFL teams has joined in their own partnerships as well.
The Dallas Cowboys have a deal with WinStar Casino, while the Ravens have signed a partnership with the Caesars Horseshoe Casino in Baltimore. The New York Jets have also made two deals, one with MGM Resorts and the other with 888 Sports.
From the NHL, the New Jersey Devils and Vegas Golden Knights have deals. Both are partners with William Hill sportsbooks. The Devils have also partnered with FanDuel and Caesars. These are currently the only sports betting partnerships with individual team franchises.
However, this number will certainly grow in the future. Here is a list of the current sportsbook partnerships with each of the professional sports leagues, including the Ultimate Fighting Championship.
- Major League Baseball - MGM Resorts, FanDuel, DraftKings and Fox Bet sportsbooks
- National Basketball Association - MGM Resorts, Fox Bet, FanDuel and William Hill sportsbooks
- National Hockey League - MGM Resorts, FanDuel and William Hill sportsbooks
- National Football League - Caesars sportsbook
- Ultimate Fighting Championship - Fox Bet sportsbooks
Frequently Asked Questions
Currently, sports' betting is legal in 14 states. There are a handful of states nearing the point where new legislation opens the door. More than a dozen more states have legislation either proposed or in discussion. The states where you can legally bet on sports today are, Nevada, New Jersey, Pennsylvania, Mississippi, West Virginia, Rhode Island, Delaware, Oregon, New Mexico, Arkansas, Iowa, Indiana, Illinois and New York.
PayPal offers a smooth way to deposit money into a sports betting account and withdraw winnings. While the number of sites that accept PayPal will certainly increase, right now that number is limited. Even more important is the state that where you are trying to place a bet.
Residents and visitors to New Jersey and Nevada can use PayPal on most sites. There are also sites that accept PayPal operating in Pennsylvania, Indiana and West Virginia. UniBet, Bet365 and BetWay are three specific sites that now accept PayPal in the states they offer betting.
Since legal sports betting launched in the summer of 2018, the sports betting market has continually performed higher than nearly every projection. The 2019 sports betting market numbers pushed close to $1 billion, far exceeding most expectations.
Projections for how the big US sports market will become vary. There are modest numbers that insist it will grow to roughly $8 billion over the next five years, while other estimates see it ballooning at nearly a 9 percent compound annual growth rate (CAGR) to climb towards the $100 billion mark.
Strangely enough, the IRS doesn't care whether you bet on sports legally or illegally. They want their cut either way. All gambling income, including lotteries and sports betting, must be reported on your tax return.
The tax rate for the sportsbooks offering legal sports betting, actually originated from the 1951 Revenue Act. It was a 10 percent tax levied against the total sports betting handle.
The original act wasn't really designed to make the federal government money, but to discourage illegal gambling. Currently, individual sports betting tax responsibilities vary according to personal income tax rates, and the tax on sportsbooks is at .25 percent.
Odds are the numbers attached to sports teams or individual competitors in reference to a particular game or sports contest. These numbers can designate a projected point difference or what is referred to as a money line.
There are also other odds, such as over and under for goals, runs or points scored. A negative number designates the favorite to win or team giving away points, and a plus sign signifies the underdog.
Sports betting is currently legal at more than 10 physical sportsbook locations. Each of these brick-and-mortar sportsbooks are linked to a commercial casino. While there is a huge cry for online sports betting, currently sportsbook apps are not permitted inside the state border. Look for this to change as the legislators realize the revenue being lost.
Presently, sports' betting in California is not legal. An amendment made to the California constitution 20 years ago has been a hurdle to gaining full sport for statewide approval of sports betting legislation. Bills have been proposed and everyone feels it will happen sooner than later, but currently it is not legal to bet on sports in California.