The Challenges Currently Impacting the US eSports Betting Landscape

Online sports betting can be viewed as still in its infancy in the United States, given that it only became legal in 2018. While competitive video gaming goes back to the 1970s, it wasn't until recently that it became available to bet on. Esports betting is a thriving market globally, with many regions already allowing fans to wager on their favorite games at licensed sportsbooks. The market provides two main betting options — skins and cash. For a long time, skin betting dominated eSports, but the last few years have seen cash betting taking over. Several reasons contribute to this trend, chief among them being the ease of access to betting platforms and markets.

As a betting option, esports is wildly attractive. It promises a huge potential that stakeholders are eager to tap into. However, the industry faces unique roadblocks that impact its success. Recognizing these challenges is the first step towards helping the sector reach its full potential. It's not enough to learn how far esports have come. A comprehensive analysis of its shortcomings is necessary to guide industry players in formulating effective solutions and set eSports betting on the right path.

A Fragmented and Complex Regulatory Framework

Betting on sports must be legal to avoid complications. It's why a bettor is advised to check local regulations before staking money on games. In the US, the legality of eSports betting isn't straightforward. Since 2018, states have had the power to craft individual legislation for online sports betting. Presently, over 30 states allow the use of betting websites. With a guide to the best crypto bookies, you can find a suitable platform for your wagering needs. However, when it comes to esports, these sites are only legal in about 18 states. Legislation varies across states, with some, like Nevada and New Jersey, regulating specific events. Market players also have to worry about federal rules, where different laws apply.

The age of participants and integrity are two major elements in the legalization of eSports gambling. In the past few years, daily fantasy sports (DFS) have gained dominance in the US entertainment market. eSports are some of the offerings available in DFS. However, fantasy sports are classified as games of skill, not chance. For this reason, the minimum age requirement for participants is 18 since the segment doesn't qualify as gambling. Many stakeholders are concerned because betting on fantasy sports is not much different from gambling, which requires players to be 21 or above.

Absence of Unified Governance

Outside of gambling regulation, e-sports encounter another problem in standardization. The sector doesn't have a clear set of rules to govern all stakeholders. For example, soccer clubs playing in the UEFA Champions League adhere to the same guidelines. In eSports, publishers such as Activision Blizzard, Valve, and Riot Games operate individual ecosystems. Each has its own rules and event formats. The result is a fragmented industry that is difficult to regulate. Developing legislation that cuts across these different scenes demands that all players be on the same page. eSports also has to contend with other legal issues, like global broadcasting and player likeness rights.

Match Fixing

While not as prevalent as in traditional sports, match fixing is a problem in eSports. Over the years, various incidents have been exposed, shedding light on the sector's integrity. The iBUYPOWER rigging scandal is the most prominent. Since then, there have been debates on insiders participating in gambling. No consistent frameworks exist to govern esports players and other stakeholders when betting. Another issue is the unfair advantage resulting from live stream latency. Delays during streaming, which can be as long as 60 seconds, compromise the credibility of live betting. The industry has tried to implement measures to uphold its integrity. It has an integrity commission (ESIC) that tracks data, educates, and vets participants. However, the solutions it provides are not sufficient for the rapidly expanding market.

Market Prediction

Esports is more complicated when it comes to setting lines compared to regular sports. The sector is incredibly unpredictable. Game titles update constantly, teams change, and metas shift. Valuing odds requires a correct prediction of the market. Bookies need comprehensive industry knowledge to set the right prices. The uncertainty in the industry also makes betting difficult for beginners. Games have different schedules and events that vary across formats. Some titles are easier to wager on than others. eSports betting novices must learn as much as possible about the market if they are to gain value from gambling. Machine learning and AI could help, but these tools rely on large datasets, which are challenging to come by in e-sports.

Responsible Play

Addiction concerns have existed as long as video games. However, technology has raised more questions about the subject due to the accessibility of entertainment medium. Online betting, particularly, draws strong criticism. Esports appeal to a young audience, which raises the issue of exposing minors to gambling. CS:GO skin betting is an example of a risky market because it appeals to teenagers and is unregulated. Reports of addiction and depression among participants are common. Several approaches try to curb the spread of problem gambling in eSports. Controlling betting sponsorships is one. eSports companies are careful about partnering with gambling brands. Riot Games recently agreed to enter sponsorships with betting outfits but promised to vet partners and restrict ads on official channels.

eSports betting is taking shape in the US, thanks to a shifting regulatory landscape. However, the market is still young and struggling to find its footing in the iGaming world that is dominated by casino games and conventional sports. Understanding the issues hindering the growth of eSports gambling will help stakeholders address them, and maybe then, the industry may be ready to compete with sports betting.