When Did Sports Betting Become Legal in the U.S.?

The legalized sports betting debate has been raging for as long as there has been sports betting. Back in the 1970s, professional and collegiate athletes were on the receiving end of some of the most insidious tactics the bookmaking world could devise. Many pro athletes were reportedly paid to ensure they would lose at sports betting establishments while others had their entire paychecks laundered through these books. It was a ‘sink or swim’ scenario for those who didn’t know how to play the game cleanly. To this day, professional sports remain one of the most popular target markets for online sportsbooks due to their lucrative nature and the fact that many leagues have regulated or prohibited sports betting.

However, over the past couple of years, the tide has begun to turn. On January 16, 2018, the Supreme Court of the United States ruled in favor of the Professional and Amateur Sports Protection Act (PASPA) in Murphy v. National Collegiate Athletic Association. The case centered around whether or not states could regulate sports gambling where the legal outcome was uncertain. As a result of the ruling, states are now permitted to regulate sports gambling so long as certain conditions are met. The most prominent of these is the necessity to maintain “clear, stable, and reasonable laws” that are not prone to selective enforcement. In addition to establishing a legal precedent, the decision also provided the clearest indication yet that the court is moving towards a more favorable stance on legalized sports betting.

The History Of PASPA

For those unfamiliar, PASPA stands for the Professional and Amateur Sports Protection Act which was introduced to Congress back in 1992 as a result of the gambling scandal involving the 1992 Olympics in Barcelona. At the time, it wasn’t illegal for businesses to accept bets on sporting events, but under Spanish law, it was outlawed to accept wagers where the outcome was uncertain. The purpose of the bill was to establish interstate compacts for the legal regulation of sports betting and to create an exemption for sports gambling where it is already legal. After a lengthy period of litigation, the Supreme Court was eventually forced to rule on the constitutionality of PASPA. As a result of the ruling in Murphy v. National Collegiate Athletic Association, PASPA is now legal in all 50 states.

The Impact Of PASPA

Since the passing of PASPA, the legalized sports betting landscape has changed significantly. In 2016, alone, nearly $13 billion was wagered on sports events with online betting outfits. It is projected that by next year, online sports betting will generate $22 billion in revenue alone. In an interview with the New York Times, William Hill CEO Stephen Hemsley stated that in 2018 they expect to see online sportsbooks handle more gambling transactions than all of last year’s professional sports combined. In terms of revenue, the total is expected to top $28 billion.

Which Sports Will See The Most Growth?

With the establishment of PASPA, the legal status of sports betting in the United States changed significantly. After spending years as a target market for those who wanted to avoid legal trouble, the country’s older sportsbooks are finally able to flourish once again. At the same time, newer sportsbooks have emerged to cash in on the increased demand. Here’s a breakdown of the sports that are expected to see the most growth thanks to PASPA.

  • NHL Hockey
  • MLB Baseball
  • US Open Tennis
  • College Football
  • NFL Football
  • Poker
  • Casino Games

Why Are Online Sportsbooks Popular?

As previously stated, revenue from online sportsbooks in 2018 is projected to hit $22 billion. However, it’s not quite that simple. According to an email from William Hill, the amount of money wagered on sports in USA casinos in 2018 is actually expected to reach $13.7 billion. That’s a difference of $8.3 billion which is, in large part, due to the fact that online sportsbooks are now permitted to accept wagers in all 50 states.

The reasons behind the increased popularity of online sportsbooks are numerous. First off, it’s relatively easy for U.S. citizens to set one up. Second, banking is easily accessible and, for the most part, legal. Third, due to increased connectivity and the growth of the internet, more people have access to global betting markets than ever before. Finally, the lines are generally decent and offer a variety of sports and betting options. For those who prefer to keep things simple, automated sportsbooks are a great option. They save a lot of time and, as a result, can offer increased liquidity.

Future Of Legalized Sports Betting In USA

Based on previous experience, the United States is well positioned to further advance the legalization of sports betting. Not only has the nation’s highest court already determined the act to be constitutional, but the decision in favor of PASPA also established a clear path towards the legalization of sports gambling. In the coming years, expect to see a significant amount of movement in this area as states, seeking to increase their tax revenues, will likely pass legislation to permit or legalize sports betting. However, given the fact that the Supreme Court is still deciding which states can and cannot regulate legal sports gambling, the status of these laws is somewhat uncertain at the moment.

To summarize, the United States is positioned to eventually see an increased amount of legal sports gambling. Based on everything that we know at this point in time, this trend appears to be here to stay. However, for those who want to take the matter into their own hands, establishing an online sportsbook is, as we’ve seen, a relatively simple and straightforward process. With the legalization of sports betting in the United States, competition is sure to follow and more and more people, looking to take advantage of the situation, will flock to the industry.