Sports betting in America is exploding

In early february Jim McIngvale, a businessman from Houston, crossed Texas’s border with Louisiana to place a $4.53m bet on his phone. In making America’s biggest-ever online bet, Mr McIngvale is pinning his hopes on the victory of the Cincinnati Bengals, the underdogs, in the Super Bowl on February 13th. He is the boldest among tens of millions of Americans who will place bets this weekend. His staggering wager reflects a broader trend: the market for legal betting is surging in America—along with attendant risks.

Since the Supreme Court struck down a law that banned sports gambling outside Nevada in 2018, 33 states as well as Washington, DC have legalised it. Seven more states have legislation in the works. The betting landscape is rapidly changing: 45m more Americans than last year can now legally bet on the 2022 Super Bowl in their home state. Many more, like Mr McIngvale, can travel to a neighbouring state to do so.

In less than four years, $97bn has been wagered in legal bets across America, yielding over $7bn in revenue for gambling operators and $923m in taxes. In October 2021 alone, Americans put down a record $7.5bn, 87% of it online. That was an eight-fold increase on the same month in 2018. Experts anticipate that the sports-betting market will keep growing. By 2028 it is expected to be worth $140bn.

The National Football League (NFL), which at first refused to team up with betting platforms, now welcomes the influx of cash. In a deal worth a reported $1bn, three betting companies—Caesars Entertainment, DraftKings and FanDuel—became official partners of the league. The NFL reportedly expects to rake in $270m in advertising revenue this season as betting companies urge fans to buy in. DraftKings doubled its marketing budget in the first nine months of 2021. FanDuel spent over $1bn on ads in the first half of the year. On the opening weekend of the NFL’s latest season, 58.2m online bets were placed, a 126% increase on 2020. The American Gaming Association estimates that at the last Super Bowl more than 23m bettors wagered $4.3bn on the game. This year they expect more than 31m Americans to bet $7.6bn.

Swift legalisation means that America may well face a parallel rise in gambling addiction. Sports bettors are twice as likely as other gamblers to become addicted. Live online betting makes it easier to bet faster and more frequently, leading to riskier gambling. The American Gaming Association launched a campaign that urges gamblers to set a budget before the game and get support when necessary. As sports betting becomes mainstream some will benefit—Mr McIngvale’s bet would net $7.7m. Many others could suffer. ■

For a look behind the scenes of our data journalism, sign up to Off the Charts, our weekly newsletter.