Since the Supreme Court struck PASPA down, over 30 states have legalized sports betting. Several other states, including Massachusetts, Ohio, and Maryland are expected to launch sports betting in 2023. Because states write their own sports betting laws, regulations governing the sports betting industry vary between states. Some of this variation reflects local attitudes about issues like betting on college sports. But three common problems in sports betting bills continue to plague this new industry:
- Geolocation Limits
- Advertising Restrictions
- Problem Gambling Program Funding
Some of these issues plague every sports betting market while some states resolve these issues well. However, continued negligence on these issues could attract federal attention. That attention could take the form of a State Attorney General’s attention or a push to standardize sports betting regulations across the United States.
Geolocation Limits
Every state sports betting bill has geolocation rules. The clauses in these bills require sportsbooks only to accept wagers from bettors in-state. This allows each state to respect the decision of surrounding states not to legalize sports betting. Partnered with strict know-your-customer requirements, sportsbook bills also ensure that sportsbooks identify bettors to avoid funneling money to money launderers.
However, geolocation limits can be circumvented by bettors who use VPNs to mask their locations. VPNs can send a bettor’s signal to another state or country, making it appear as if that bettor is located in a legal state.
Sportsbooks can catch this trick. Some sportsbooks get alerts when bettors log in with VPNs. Others can detect when two IP addresses don’t match and block the account.
Enforcement of geolocation restrictions from VPNs varies. Some bettors report success in circumventing geolocation restrictions. Others can’t break through the geo-blocks. That variation in customer experiences is a…
