Since the legalization of sports betting in New York in January 2022, the state has experienced a boom. In 16 months, they have surpassed the $25 billion mark, setting a record for the fastest time to reach that figure. This success went far ahead of the previous record set by New Jersey, which took nearly 47 months to reach a similar level. Nevada is still the only other state that is comparable to New York in this aspect.
Benefits of betting legalization for the state
The success of the sports betting market has proven to be beneficial for the state. As of June 2023, it has collected $983.5 million dollars in tax revenue from betting companies. This is due to New York's high tax rate of 51% of gambling revenue. This rate is the highest in the United States and helps to fund various government programs and initiatives.
At the current rate of market development, New York has the potential to surpass New Jersey. Despite the fact that online bookmakers started operating in 2018, the total betting volume in the Garden State amounted to just over $38 billion. Thus, New York shows the potential to become the absolute leader in this area.
In the New York sports betting market, FanDuel and DraftKings are the market leaders. FanDuel held the top spot for almost 80 weeks before DraftKings was able to overtake them in June. The two companies are significantly ahead of the competition and currently own nearly 75% of the market in the state. In 2022, FanDuel has $6.6 billion in revenue, and DraftKings has $4.6 billion in revenue.
Since January 2022, sports betting operators in New York have earned about $2 billion in net revenue. Taxes have been paid on it, which is used to fund the state's education and responsible gaming programs. According to the Empire State regulator, DraftKings and FanDuel alone have generated more than $800 million in tax money.
Future of the Market
The New York betting market is expected to continue to grow, especially after the acquisition of PointsBet's U.S. division. In another interesting development, Bally Bet announced that it would suspend its services in the state of New York due to a platform upgrade. This is expected to take a few months, and once re-launched, it will be available across the U.S.
If online casinos are added to the bookmakers, tax revenues from the sphere will increase even more. According to topcadcasinos.net, many Americans play at casinos with a good reputation but do not have a local license. So, millions of dollars in tax revenue are flowing past the treasury.
The success of online bookmakers in New York has sparked discussion about the possibility of legalizing mobile casinos, which could open up new opportunities for locals and bring additional revenue to the state in the form of tax deductions.