eSports Betting in the States - Not so Fast

• States that are legalizing sports betting are mostly steering clear of eSports betting for now
• Approximately 80 percent of global esports enthusiasts are aged 10-35, which could result in underage gambling
• More established eSports leagues have a better shot at legalization

SCROLL DOWN FOR MORE

Sports Betting in the States

While online gambling sites based overseas have been constantly improving their eSports betting options to those living in the U.S., most states contemplating legalization of non-virtual sports wagering have opted not to allow eSports for the time being....and there could be good reason for this.  

In May, the U.S. Supreme Court ruled to overturn decades long prohibition of sports betting in all but one U.S. state (Nevada).  A handful of others like Delaware and Oregon had limited sports wagering.

Heading into the new football season, states like New Jersey, Mississippi and West Virginia were seeing a flurry of activity from their newly constructed sportsbooks.  These states and a few others have amended their own laws to all sports betting.  Others have opted to sit on the sidelines for the time being.  Still others won't offer the activity any time soon due to various obstacles standing in the way of implementation.

eSports Obstacles

The offshore sites are likely to be the only avenues for betting eSports even in states that have legalized sports betting.

Individual states may frown upon the potential for integrity breaches, match-fixing and underage gambling. 

According to the 2016 report by Newzoo, approximately 80 percent of global esports enthusiasts are aged 10-35, and about 27 percent are aged 10-20.

From VentureBeat.com:

The classification of esports in gambling legalization legislation can determine the legality, type of government oversight, and taxation of esports gambling. Nevada classifies esports as “other events,” which is intended to include other non-traditional events, such as the World Series of Poker. States must determine whether esports gambling is classified as a “sport” and treated the same way as major traditional sports leagues (e.g., the National Football League) or as an “other event,” with unique esport-specific regulations and gambling restrictions.

Some states may first legalize the more established esports leagues, such as the Overwatch League or League of Legends North American League Championship Series, before allowing widespread betting on esports. Regardless of the initial classification, the popularity of and potential tax revenues from legal esports gambling likely will drive forward-thinking states to explicitly include esports in their sports betting legislation.

The high demand and lucrative revenue stream from taxation could see some states looking to take the plunge.  But, for the time being anyway, eSports will have to play second fiddle to the more established professional sports leagues like the NFL and NBA as well as the NCAA in College sports.

- Gilbert Horowitz, Gambling911.com