Americans didn’t start betting when lawmakers legalized it; they just stopped hiding it. Legalized online sports betting can reduce the illegal offshore market and protect bettors, but only if states let legal operators compete. Strict regulations on ads, daily betting caps, and punitive taxes push bettors back to illegal sites. Instead, states should focus on identifying and helping people with gambling problems and on keeping the market attractive enough to win responsible bettors’ business.
Bringing online sports betting into the open offers clear benefits: it channels an existing activity into safe venues, helps identify—not stigmatize—gambling addicts, generates public tax revenue, and lets responsible adults choose a lawful recreational activity.
From 2022 to 2025, the illegal sports betting market share is estimated to have fallen from 36 percent to 24 percent. This is also down from 100 percent of the market being illegal in most states before 2018 when the Supreme Court made the pivotal ruling allowing states to legalize it.
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Justin Leventhal is a senior policy analyst for the American Consumer Institute, a nonprofit education and research organization. For more information about the Institute, visit www.TheAmericanConsumer.Org or follow us on X @ConsumerPal.