The Growth of Online Sports Betting in the US
Since the legalization of online sports betting by the US Supreme Court in 2018, the digital betting market in the US has experienced unprecedented growth. It is predicted that by 2028, there will be over 52 million online bettors in the US, with a market volume worth approximately $15 billion. The compound annual growth rate (CAGR) for the period of 2023-2028 is estimated to be 15.60%.
Sports Betting Across The Federation
As of Q4 2023, online sports betting was active in more than two-thirds of the US federal states. However, there are still several states where online betting remains illegal, including Utah, Texas, South Carolina, Oklahoma, Missouri, Minnesota, Idaho, Hawaii, Georgia, California, Alaska, and Alabama. The reasons for this vary from religious grounds to political disagreements and socio-economic opposition to legalization.
Georgia and Minnesota are more likely to pass legislation to legalize online sports betting in the future.
The US Golden Geese of Online Sports Betting
California and Texas, the most populous states in the US, have yet to legalize online sports betting. While economic potential is a significant factor, other considerations such as tribal-land casinos and business interests also play a role in these states. Many potential bettors in California currently travel to nearby states like Nevada or Arizona to place their bets. However, there are offshore apps available for Californians to bet online.
Basketball is the most popular sport for online wagers in the US, with teams like the Dallas Mavericks, Houston Rockets, San Antonio Spurs, LA Lakers, Clippers, Golden State Warriors, and Sacramento Kings attracting a large fan base. It is optimistic to expect the legalization of online sports betting in California and Texas in 2024, but ongoing negotiations may lead to a positive outcome in the future.
The Interesting Case of The State of New York
Prior to January 2022, New Yorkers had to go to New Jersey to place online bets on their favorite sports teams. However, with the official announcement of mobile betting in New York, residents were able to place bets within the state. In the first two months of 2022 alone, New Yorkers invested over $2 billion in online bets, resulting in $80 million in taxes paid to the state.
Some sports clubs in New York even suggested the inclusion of betting stands at stadiums to provide additional touchpoints for people to wager. This showcases the profitability of online betting when properly regulated. States that adopt online betting acts can expect similar growth and revenue opportunities.