Sports betting is set to surge this month on the back of college basketball’s March Madness tournament. Across the US, states with newly-legal markets recently helped to push monthly wagers on sporting events past $4 billion for the first time ever.
Additionally, several markets that could handle hundreds of millions of dollars in bets per month are pushing ahead with legalization measures. New York and Georgia, for example are racing against the clock to deregulate mobile and online sports betting before their legislative sessions end at the end of this month.
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Sports betting has now been legalized in 25 states (plus Washington DC), with 21 of those markets being fully operational.
Despite a few key states seeing a pullback in total bets handled in February, new entrants pushed the total sports betting handle in the US over the $4 billion mark for the first time in history. February was the fourth straight month that the entire US industry set a new record.
Wall Street is broadly enthusiastic about sports wagering companies. As Casino.org notes, brick-and-mortar sportsbooks are low-margin enterprises, while online operators face lower fixed costs and much greater ease of access.
In a recent note to clients, Goldman Sachs wrote, “We expect a combination of favorable legislation and consumer adoption to drive growth in US online sports betting and internet gambling from $900 million/$1.5 billion markets today to $39 billion/$14 billion in 2033, equating to 40%/27% CAGRs for over a decade.”
March Madness Sets up a Betting Surge
The outlook for sports betting faces a completely different outlook in 2021 than it did in the early part of 2020. This time last year, MRP was covering the NBA’s announcement that they would be suspending their ongoing season due to the outbreak of COVID-19 on the American mainland. The NCAA followed up with an even bigger shock, outright cancelling college basketball’s “March Madness” national tournament.
Thankfully, this year’s tournament is in full swing with no significant COVID-related issues to speak of.
March Madness has become a staple of American sporting, as well as sports gambling, due to the notorious unpredictability of outcomes in nearly every game. The betting angle has been amplified by the popularity of filling out a March Madness bracket, an attempt to predict the winners of every single game in the tournament. 17.2 million brackets were entered into ESPN’s 2019 Tournament Challenge alone, along with billions of dollars wagered each year during tournament time.
While the number of Americans placing bets this year — 47 million — is expected to stay flat from 2019, wagers are expected to break the 2019 record of $8.5 billion.
Since 13 new legal sports betting markets have opened up since the 2019 tournament, Forbes notes that the number of people betting online this year is up more than 200% from 2019. Per the American Gaming Association, about 18 million people will bet online, versus…