The Supreme Court ruled that states can establish their own betting system, but not across state lines. Geofencing ensures mobile apps stay within each state.
Sports betting is legal in 12 states in some capacity. Mobile betting, however, is only allowed in five: New Jersey, Pennsylvania, West Virginia, Iowa and Nevada.
About 80 percent of gamblers are now betting online. In May, New Jersey surpassed Nevada for the first time.
Some state lawmakers fear the convenience of placing mobile bets could trigger an increase in gambling problems. Legislators in Rhode Island, for example, debated allowing mobile sports betting after extending it to casinos.
State Rep. Teresa Tanzi argued, “This is something that people are going to be able to do under the radar until it’s a major problem for them.”
State Senate President Dominick Ruggerio countered that lines would be too long without a mobile option. Before the state started allowing mobile sports betting, “The line was out the door, around the corner,” Ruggerio said.
Regardless of whether it’s legal, people are still able to place mobile sports bets on the black market. Illegal bets made through neighborhood bookies and offshore sites are valued at $150 billion a year, The American Gaming Association told the WSJ.
Legal online sports gambling is providing business opportunities not only to payment services providers but also to companies that sell digital ID authentication services. That’s pushing companies like casino site 888.com to invest in automated authentication processes, according to Russell Medley, 888’s director of fraud and risk management.
According to an analysis released in January, “New Jersey’s online sportsbooks accounted for $241.05 million, or 76 percent, of bets in December.”
Another report pegs the total spending via online sportsbooks in the U.S. at more than $40 billion by 2020.