US Betting Market Will Be Worth $56 Billion by 2023

Last Updated on 31 March 2022

In 2018, the US Supreme Court overturned the ban on sports betting, meaning individual states could start legalizing sports wagering. So far seventeen US states have done that, and soon more will follow.

New York will start accepting online sports bets as soon as this January, and it is expected that the state of Ohio will legalize betting by the end of the year. California is also in the process of deciding whether to make sports betting legal within its borders, with a positive outcome widely expected.

Goldman Sachs estimated that the US online betting market could reach dizzying heights and could be worth $56 billion by 2023. If betting operators weren’t aware of how lucrative the US wagering market could be, Goldman Sacs’ predictions gave them a ball-park figure. So, now everyone wants a piece of the action and profits, including some super-ambitious Australian bookmakers.

Bookies’ Share Prices Sky Rocketed

American casino giants such as Caesars, Baily’s, and Wynn Resorts all launched their mobile wagering apps and online betting sites. Fantasy betting operators like DraftKings and FanDuel didn’t want to miss the golden opportunity either. International heavyweights like Flutter Entertainment, the Sportsbet owner, also joined in on the action.

Even companies that had small operations domestically, like Australian bookmakers PointsBet, BetMakers, and BlueBet, went live in many US states.

PointsBet, for instance, currently operates in eight US states. BlueBet, on the other hand, had a share price value of $1.14 in July. However, after the Australian betting operator announced it will pump $50 million into its US expansion, the value of BlueBet’s shares soared to $2.86 in August.

BetMakers is another Australian bookie that is looking for a place in the sun in the US. Its strategy is to introduce “fixed odds” wagering to American bettors in addition to TOTE (parimutuel) betting.

US$7,500 Free Bets for New Customers

Launching a US betting app is one thing. Remaining competitive is something completely different, though. Many of the bookmakers conquering the US market soon found out how competitive it is.

For instance, even though BlueBet’s share prices went through the roof in August, they are now back down to $1.34.

Those fluctuations in share price values are caused by the increased competition in the US market where bookmakers often come out with bonus offers so enticing, you wonder if they might lose money on them. For example, at the start of the NFL season, Caesars offered an outrageous US$7,500 free bet for its new customers.

Market May Have Normalized Now

According to PointsBet CEO, Sam Swanell, the US betting market has become so “hot” that it was a bit “taken aback” as a result. He added that share price values dropped because betting operators spent so much money on advertising campaigns to promote their sports betting and bonus offers, but because there were so many of them, they had to wait to see returns on their investments.

Swanell said that the start of the NFL season was probably when the industry was at “peak competitiveness” and that bookmakers’ spend and share prices might have normalized now.

As far as PointsBet’s involvement in the US market is concerned, Swanell said that they were targeting a 10 percent market share in each state they operated.

According to Swanell, PointBet’s forte was live betting. The CEO said that they had a more competitive in-play wagering offer than most of their US rivals, and that could help them get to the 10 percent benchmark.