The advent of regulated sports betting in the United States has seen millions of Americans sign up for accounts with licensed U.S. sportsbooks but the offshore market is still alive and well according to a recent survey.
Black Market Blues
According to a recent survey conducted by an industry insider, 33.9% of 5,100 sports bettors residing in states with legal sports betting polled, have responded that they do wager with at least one offshore sportsbook. Of those respondents, 54.2% were male while 44.8% were female with 1% declaring they were non-binary.
Some of the more interesting results revealed that 64.1% said they wagered $24 or less per week on sports which lends credence to sports betting being a low-cost hobby for most recreational bettors compared to the 8.5% that stated they bet more than $100 per week.
On a scale of 1-10, those polled were asked to rate their sports betting acumen with the average score graded at 4.97, a relatively low mark for those who express an interest in predicting the results of sports performances.
The poll also asked the respondents if they would register with an offshore sports betting site if regulated sports betting in the U.S. was no longer available. A total of 43.1% answered in the affirmative while 56.9% said no. If a U.S. sportsbook limited the respondent’s wager amount, 39.1% said they would turn to the offshore market while 60.9% said they would not.
As for player prop betting, a contentious issue in the U.S. college market where states have been banning betting on college player performances due to harassment issues, 35.4% said they would turn to overseas sports betting sites.
Cease-and-Desist
According to the American Gaming Association (AGA), one of the biggest existential threats to the U.S. sports betting market is the offshore sports betting industry that take millions of sports betting dollars away from those states that receive tax revenue from the licensed sportsbooks operating in their jurisdictions.
Bovada (find out more with our Bovada Review), one of the most well-known offshore sportsbooks, has received cease-and-desist letters from several states and has abided by those demands thus far. Bovada has already terminated operations in Michigan and Colorado while it is also restricted in Nevada, New Jersey, New York, Maryland, and Delaware.
Connecticut’s Department of Consumer Protection recently issued its own cease-and-desist letter to Bovada, which will likely cause it to exit the Constitution State. According to reports, the same agency has issued cease-and-desist orders to other offshore operators, which could be a foreshadowing of other states doing the same.
“The state of Connecticut has three licensed online gaming operators – FanDuel, DraftKings and Fanatics,” wrote Kaitlyn Krasselt, director of communications for the Department of Consumer Protection, in an email. “There is not an opportunity for more operators to become licensed in our state unless one of those three departs. Any business conducting unlicensed gaming activity in Connecticut could result in a cease-and-desist letter sent to the company operating illegally.”
AGA President Bill Miller wrote a letter in 2022 to U.S. Attorney Merrick Garland asking the federal government to intervene on the state’s behalf to prevent offshore sportsbooks from operating in the regulated U.S. market.
“Successful enforcement actions against Bovada by Michigan and Colorado are proof that states have tools to fight back against offshore operators and should serve as blueprints for other states to follow,” said Chris Cylke, the AGA’s senior vice president of government relations, in a recent statement. “But states should not have to take on this battle alone – the [U.S. Department of Justice] must also use its powers to aid the fight against illegal gambling, which Congress has clearly identified as a department priority.”
