What It Takes To Become A Legal Sportsbook In The US

While online gaming is a popular pastime for many in the US, the laws concerning it are pretty complicated. This is because whether a type of online gambling – e.g. casino, poker or sports betting – is legal or not is determined at state level. While that can make for quite a flexible situation, for example with some states making online sportsbooks legal but not casinos, it can also be confusing for people who just want to be able to place bets online.

An example of the way in which the individual states in the US can take matters into their own hands when it comes to the legal status of online gambling is the recent decision by the state of Colorado to legalise sports betting there. The change to the betting regulations was passed in May of this year and it allows people living there to place bets on sports on the condition that they are using only operators or sportsbooks that have been licensed by the state. The process of legalising sports betting in Colorado actually started a year before though, when the local lawmakers submitted Proposition DD ending the ban to the Governor Jared Polis and he signed it. The changes were subsequently approved by the voters of Colorado last November and, thanks to the Supreme Court ruling enabling US online gambling laws to be determined at state level, this was all that was needed to change the law.

How online sportsbooks can achieve legal status

The changes to the online gambling legislation in Colorado only encompass sports betting, with online casino and poker both remaining illegal in that state. Furthermore, it is not the case that people can simply bet on sports using any site they choose. As Gambling.com points out, the first thing that any sportsbook or betting operator has to do if they wish to secure a license to provide legal sports bet services is to apply to the Colorado Limited Gaming Commission for one. By the same token, gamblers who wish to take advantage of the legislative changes surrounding sports betting in the state need to check the website of any operator to make sure that they have secured this license before starting to place bets with them, if they want to remain on the right side of the law. A number of major operators have already secured approval, including Penn Sports Interactive, William Hill and DraftKings, with more certain to follow in due course.

legal sportsbookWhat are people in Colorado are allowed to bet on?

When it comes to what people are actually allowed to bet on, the law covers all of the typical sports bets that anyone would be likely to want to make. This ranges from teams competing in professional national leagues, such as the Colorado Rockies or the Denver Broncos, to college sports, international leagues like English Premier League soccer and all other sports from tennis to golf. The fact that the law changes encompass pretty much any and all sports is important, because research into the issue suggests that sports betting fans in the US want to abide by the law but are often confused by it.

A survey that the American Gaming Association commissioned earlier this year found that 74% of those taking part were keen to avoid breaking their state’s gambling laws. It also found that 52% had bet on sports illegally in the past twelve months, but that over half of that 52% did so because they were unsure about the law in their state. This indicates that the decision to keep the new legislation in Colorado comparatively simple makes sense. Legalising online sports betting and other forms of online gambling also offers the potential to tax it, which is presumably one of the reasons why a number of other US states are looking at doing so.

legal sportsbookWhat does the future hold for online gambling in the US?

Sport betting is the type of online gambling that enjoys the widest state-by-state legal status, with Washington DC and 18 states having legalised it. There can be little doubt at this point that we are at a tipping point in terms of online sportsbook legislation, as North Carolina, Washington, Tennessee and Virginia are all currently in the process of following the example of Colorado and making it legal within their jurisdictions.

Given that the evidence shows that people will bet on sports anyway, but would rather do so using a licensed operator, it is not hard to see why more and more US states are looking to use their powers to legalise it. The other states moving towards legalisation should make the process as straightforward as Colorado has, to ensure that people setting up online gaming sites seek out the licensing needed to provide it legally, and to avoid the problems that countries like the US’s neighbour Canada have had in effectively legislating online gambling. The situation surrounding online casino and poker is a little more cloudy, but it is hard to see how they can remain unlawful for long once legal online sports betting becomes widespread across US states.

We are seeing a shift towards online gambling, in the form of sports betting, becoming legal in more states. In turn this means that operators need to deal with individual state legislation to set up legal sportsbooks.

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