DraftKings to offer sports betting after US Supreme Court overturns ban
After today’s (May 14) decision by the US Supreme Court to essentially overturn the Professional and Amateur Sports Protection Act (PASPA), DraftKings has announced that the company will enter the sports betting market.
DraftKings will offer sports betting due to a new ruling by the US Supreme Court
In a release, DraftKings stated it was well-positioned to capitalize on sports betting, given that it already runs one of the world's largest daily fantasy sports mobile platforms that “includes stringent consumer protections and transparency for nearly 10 million customers.”
It continued to say that, even with today's announcement, “DraftKings remains fully committed to its popular daily fantasy sports business, which will continue to be a major focus for the company.”
Stated Jason Robins, chief executive and co-founder of DraftKings: "Our mission has always been to bring fans closer to the sports they love and now, thanks to the wisdom of the Supreme Court, DraftKings will be able to harness our proven technology to provide our customers with innovative online sports betting products. This ruling gives us the ability to further diversify our product offerings and build on our unique capacity to drive fan engagement."
The PASPA law, which went into effect in 1993, essentially limited sports betting to Nevada for the last 25 years, though Oregon, Montana and Delaware were grandfathered in for limited betting.
New Jersey brought a suit to overturn the law years ago, and today, PASPA was declared unconstitutional in a 6-3 decision. Now, it will be up to states to decide if residents will be allowed to bet on sports.
Nearly two-thirds of Americans support legalized sport betting and today's move lifting this antiquated prohibition also opens the door for greater consumer protections and transparency through online wagering. The addition of online and mobile sports betting holds the potential to generate billions of dollars annually for cash-strapped state governments.
"Today's Supreme Court ruling is welcome news to the millions of Americans who currently wager $150bn illegally each year through off-shore, black market bookies," said Robins. "States are now free to allow their residents to place mobile sports bets with licensed, trusted companies based in the US and that pay taxes here."
In anticipation of a favorable ruling by the court, DraftKings has been preparing since 2017 to launch a sports betting platform for mobile, providing another advantage for the company. DraftKings is working with state regulatory officials to apply for operating licenses in those states that have already passed legislation authorizing sports betting.
Last year, a merger between DraftKings and rival FanDuel was called off after a ruling from the FTC found that the combined company would represent over 90% of the daily fantasy market.
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