$10bn legally wagered in 14 months
Since the federal ban on sports betting was lifted in May 2018, more than $10bn has legally been wagered on sports betting in the United States.
According to the American Gaming Association, before the ending of the federal ban, there was about $150bn in sports bet made each year. Of this, about 97% of it was through illegal channels. The rest was bet in legal sportsbooks in Nevada.
One of the main reasons for the ending of the Professional and Amateur Sports Protection Act of 1992 was to put an end to these black market activities.
MILESTONE ALERT: With most states reporting July numbers, $10 billion was legally wagered on sports in the 14 months after the Supreme Court overturned PASPA. pic.twitter.com/f3V1p3HFpv— American Gaming Association (@AmericanGaming) 22 August 2019
Sports betting is now legal in almost 20 states, but the black market betting sector is still strong on those states where the activity is still not legal.
As more states legalize sports betting and mobile gambling, the size of the black market will likely decline significantly.
Two clear leaders
Nevada accounts for more than half of the $10bn legally wagered having reported a handle of roughly $5.3bn.
Nevada accounts for more than half of the $10bn legally wagered
One of the major success stories is that of New Jersey, with the Garden state reporting a handle of $3.5bn since legalization in June 2018. On average, 85% of the state’s total handle has been wagered through mobile sportsbooks.
As you can remotely sign up for a mobile sportsbook in New Jersey, it is extremely easy to start betting. Many people from nearby states such as New York travel across state lines into New Jersey regularly to place sports bets via their mobile devices.
Other notable contributors
Pennsylvania has been gradually expanding its sports betting market since the state’s first sportsbook opened in November 2018. Their handle is around the $300m mark. To date, there is no mobile gambling in the state.
Mississippi also has reported a handle of about $300m since opening retail sportsbooks in August 2018.
West Virginia has legal sports betting in place since August 2018. The eastern U.S. state has reported a handle of nearly $140m. A lot of the state’s efforts have been inhibited due to issues with online betting.
The chasing pack
Other states where sports betting has been legal for some time include New Mexico (only tribal facilities), Arkansas, New York, Rhode Island and Delaware. These states make up a nominal share of the total sports betting handle.
Iowa has just launched their retail and online sportsbooks. Indiana is also following a similar path. A tribal casino in Oregon is opening a sportsbook before the end of August, with the state lottery releasing their platform in the coming months.
Therefore, 13 states currently have open sportsbooks. Other states have legislation in place but are still working on the regulatory framework for the sector.
Market potential going forward
The U.S. sports betting sector is still in its infancy and has massive scope for growth.
Therefore, the current market is only about 4.2% of what it potentially can be.
Potentially lucrative markets
Some of the markets with the most potential are California, New York, Florida and Texas.
New York has a limited form of legal sports betting in place, allowing the four upstate casinos to have a sportsbook. Mobile sports betting has been a major topic up for debate as of late in the Empire State.
New York will only see about 10% of the market potential for sports betting
According to estimates, if there is no mobile sports betting and only retail sportsbooks in the four upstate casinos, New York will only see about 10% of the market potential for sports betting.
Sports betting looks far off in the other three states. There are significant tribal interests in Florida and California’s gambling industry who do not want to see legal sports betting. Texas is a conservative state when it comes to gambling, so expansion looks unlikely in the next few years.
Of the 50 states, only eight states have yet to consider sports betting legalization during 2019. These eight states are Florida, Alaska, Wisconsin, Oklahoma, Nebraska, Wyoming, Utah and Idaho.