A surge in popularity of Daily Fantasy Sports Creates challenges for regulators
By Evan Blair, ‘25, and Evan Cecchini, ‘25

Daily Fantasy Sports (DFS) is the new wave of online gambling that has hit the country. The recent trend allows players to place bets minute by minute on any game, anywhere around the world. Like never before, people now have a full casino in the palm of their hand, and can play at any point in the day. Despite this, there are still states around the country that have not legalized the industry due to the many uncertainties surrounding DFS.

Critics say that the industry leads to addiction, poverty, and an overall weaker economy. However, from our research, we have concluded that DFS gaming is not only a benefactor to the economy, but inevitable in terms of its implementation in every state in America.

The history of gaming law in the US is not a complicated one. The first place to look is The Federal Wire Act of 1961, which, “prohibits the use of interstate wire communication facilities by those in the gambling business to transmit bets or gambling-related information.” These actions which regulate interstate commerce are upheld by Article I, Section VIII of the U.S. Constitution.

There have been similar laws enacted to limit the use of the internet across state lines to wager money, but there has been no larger case than that of Murphy v. The NCAA (2019). Murphy reversed the Professional and Amateur Sports Protection Act of 1992, which “generally prohibits state governments from sponsoring, operating, advertising, promoting, licensing, or authorizing gambling on competitive games in which amateur or professional athletes participate.” Murphy allows DraftKings and FanDuel, as well as other companies, to make an impact on state economies.

States that continue to restrict online sports betting cannot ignore the facts forever. The National Conference of State Legislatures (NCSL) reported that “Pennsylvania, one of the largest states to legalize paid-entry fantasy sports, released a House fiscal note estimating the tax will generate over $500,000 in the remaining three months of its fiscal year.” The numbers don’t lie. The economic impact that Daily Fantasy Sports have had are obvious and can only benefit states.

Certain states, such as Virginia, have already legalized DFS, allowing these companies to enter a new market. The compelling interest of the general public combined with the desire for large corporations to enter new markets creates an intriguing economic offer that will eventually reverse the state's decisions.

Nevertheless, the negative social implications have always been the core concern with gambling. Many argue that gambling leads to addiction, debt, and poverty. According to the Congressional Research Service, “The National Council on Problem Gambling (NCPG) adopted a resolution on October 8, 2015, stating it believes participants in fantasy sports are at high risk to, and do, develop gambling problems.” The “high risk” that the NCPG has attributed to DFS has been highlighted by state legislatures.

Furthermore, there exists a valid moral and religious argument against DFS. Some regulators claim that any form of gambling is sinful because of the inherent greed for profit behind betting.

However, states have proven they are capable of protecting their citizens against addiction, bankruptcy, and poverty when it relates to gambling. State legislatures have oversight committees protecting consumers from corporation overreach. State governments also regulate online gambling companies through a variety of guidelines. As one source says, “If state lawmakers decide to treat DFS as gambling, and if the courts determine that status is consistent with federal law, DFS would be subject to regulations, licensing, consumer protection safeguards, and other mandates where states choose to impose and enforce them.”

Politicians argue that DFS is not a game of skill, but rather a game of luck or chance. However, this is where their argument becomes obsolete and even hypocritical. The Marquette Sports Law Review published an article stating that “Some may contend that luck is still heavily involved in the success of daily fantasy players, but long-term data supports the conclusion that skilled players who devote more time to research consistently demonstrate their skill in outperforming other players.”

Overall, Daily Fantasy Sports is a game of skill, which lawmakers must consider. State lotteries already accomplish the goal of raising revenue, but under the many tests that the Marquette Sports Law Review conducted, DFS can accomplish the goal of raising revenue as well as promoting a skill-based game. State legislatures will soon realize that DFS is a much safer option than state promoted lotteries.

There is no perfect policy on this matter, but as DFS bills continue to be presented to the floors of state legislatures, new policies and regulations will be brought up as well. There is no telling what this industry could end up looking like in the next decade, but we do know one thing: DFS implementation across the U.S. is inevitable.

[This piece was adapted from a project for Professor Rebecca Harris’s Public Policy course in Fall 2022.]

The opinions expressed in this magazine are the author's own and do not reflect the official policy or position of The Spectator, or any students or other contributors associated with the magazine. It is the intention of The Spectator to promote student thought and civil discourse, and it is our hope to maintain that civility in all discussions.