Claiming the betting crown
New Jersey first legalized sports betting shortly after the repeal of the Professional and Amateur Sports Protection Act in 2018. Since then, the state has proven itself a powerhouse of the US betting industry, with its handle surpassing its closest competitor Nevada every single month since December 2019.
sportsbooks took more than $1bn in wagers for the fourth consecutive month
Although a number of new states joined the US betting landscape in 2021, New Jersey once again established itself as the market leader. According to data released by the New Jersey Division of Gaming Enforcement on Friday, the state’s sportsbooks took more than $1bn in wagers for the fourth consecutive month in December at $1.23bn.
New Jersey’s 2021 handle of $10.9bn represents a staggering increase of 82% year-on-year and a new highest yearly total for any state in the US.
It’s not all good news for the betting titan, however, with a new kid on the block now looking to make a name for itself nearby. The neighboring state of New York launched its highly-anticipated mobile betting market just nine days ago, and its predicted success could spell trouble for New Jersey betting dominance.
Fresh out of the blocks
On January 8, New York became the most populous state to offer mobile betting as wagers started rolling in for its four sportsbooks. BetRivers, FanDuel, DraftKings, and Caesars Sportsbook all began taking bets on the same weekend, while BetMGM joined this Monday. Four other operators have also received the green light to go live in the near future.
17.2 million transactions over two days from launch
Although New York has not made betting figures available just yet, transaction reports paint a clear picture of the market’s opening days. The state’s sportsbooks processed 17.2 million transactions over two days from launch, according to GeoComply. The geolocation company described that as “larger than any other standalone state total.”
Those involved in the market have also expressed high hopes for its success. Speaking with VegasSlotsOnline News in November, Kambi vice president of sales Sarah Robertson said the market has the potential to be “huge” due to its population of more than 20 million and the “clear appetite for regulated mobile wagering.”
Financial services company Macquarie has predicted that New York’s online betting market will eventually hit $1bn in annual revenue. Meanwhile, Will Hershey, a Roundhill Investments analyst, believes New York will become the “largest regulated market in the US.”
No more cross-border gambling
Where this success could cause issues for New Jersey is in the impact on cross-border gambling figures. According to state officials, around 20% of New Jersey’s sports betting handle comes from New Yorkers crossing state lines to use mobile betting services. With similar sportsbooks now accessible from New York homes, Garden State handle will most likely reduce significantly.
If cross-border gambling estimations are correct, then New Jersey would lose out on around $2.18bn in wagers per year based on 2021 figures. That’s a substantial loss and one that could certainly impact the state’s position as number one in the US market. For instance, taking 20% from the state’s handle would place it behind Nevada for November, the last reported month by both jurisdictions.
We won’t know the true impact of New York’s arrival on the scene until betting handle figures roll out for the beginning of 2022. One thing is for certain though, things just got a little more challenging for the mobile sportsbooks of New Jersey, which up to now have enjoyed the fruits of an unimpeded market.