What is esports?

Playing games competitively, watching esports, and even legal betting on esports are all huge and growing activities around the globe and here in the United States. 

Esports can involve one-off battles between renowned gamers, team matches, and tournaments of various sizes. Many popular video games and game categories fall under the esports umbrella: 

• Multiplayer online battle arena (MOBA) titles such as League of Legends and Dota
• First-person shooter (FPS) titles Counter-Strike: Global Offensive, Call of Duty, Halo
• Sports simulator games like FIFA, NBA 2K, and Rocket League
• Other games such as Fortnight, Street Fighter, and Overwatch

Therefore, esports refers to video game competitions. This list constantly expands over time. As a video game itself takes off nowadays, it likely migrates its way onto popular Twitch streams and, ultimately esports betting markets. 

Esports betting takes a few different forms, namely standard betting, skins, betting, and fantasy esports. Standard betting greatly resembles betting on traditional sports. Depending on the specific underlying game, it may feature betting on any or all point spreads, money lines, totals, and props. Standard esports betting has found its way to some of the leading sportsbooks, such as Caesars Sportsbook.

Skins betting is similar, except it involves wagering game-specific items, like weapon charms and skins. They could be boosts or virtual weapons that gamers also buy, sell, and earn in-game. Legal US sportsbooks do not participate in skins betting, but there are some organized sites you can find online overseas. 

Fantasy esports are daily fantasy games that work similarly to regular DFS sports and are perfectly legal and offered by DFS books.

Is esports betting legal in the US

Yes, it is legal to bet on esports in the United States, but it is a very confusing landscape. The laws vary enormously from state to state. Thirteen US states specifically allow Esports betting now. Those states are Arizona, Colorado, Connecticut, Louisiana, Maryland, Nevada, Nebraska, New Jersey, Tennessee, Virginia, Washington, West Virginia, and Wyoming. Ohio will allow it when all sports betting legalizes on January 1st, 2023. Indiana and Iowa laws specifically ban Esports betting. 

Several states have some form of legal betting on “regular” sports, but the laws are unclear as to Esports wagering. This list includes Arkansas, Delaware, Kansas, Michigan, Montana, New Hampshire, Rhode Island, South Dakota, Washington DC, and Wisconsin. Illinois and Pennsylvania are in the murkiest state of all as there is optimism but not a certainty that gambling laws already on the books allow it. 

Generally, state laws require bettors over the age of 21 and actually Esports competitors over the age of 18. Nevada and New Jersey are considered the least restrictive. But even there, Nevada requires all Esports markets to receive approval from the state’s Gaming Control Board. New Jersey officially defines a legally bettable “sports event” to include “all professional electronic sports and competitive video game events that are not sponsored by high schools, do not include high school teams, and do not include any participant under the age of 18 years.” Further, New Jersey has approved VIE.gg, the first site in the nation entirely dedicated to esports betting.

As to the other states where esports betting is specifically legal, Colorado prohibits bets on video games “not sanctioned by a sport governing body as an electronic competition.” Nebraska approved esports betting, but nothing has launched as of yet. The others specifically allow esports betting but with regulations.

What does esports betting look like?

Betting on esports generally resembles betting on sports. Here is a betting screen ahead of a Call of Duty League event.

Every bettor will recognize spread, total and moneyline markets. What’s more, there is prop betting.

It is easy to see why sportsbooks love esports betting. Notice the width of some of these spreads. They are all considerably larger than the typical -110s found on even odds physical sports events. In addition, consider the major players and bettors here. It skews much younger than the typical sports bettor. 

How about daily fantasy esports?

This popular activity is generally legal everywhere in the US that allows daily fantasy sports (DFS)

It is structured just like DFS. Sites assign dollar value “salaries” to the esports competitors. DFS players get a salary cap and fill lineups with players in a league event or tournament competition. The events themselves generate stats for the event players, which then result in “points” in DFS contests. The DFS players with the most points win money, just like in every other DFS contest.

The future of esports betting

Esports themselves have an enormous following in both players and viewers. Riot Games hosts a League of Legends World Championship each year. The winning team takes in a multimillion-dollar prize as well as ownership of the Summoner Cup, a 44-pound trophy produced by Tiffany’s. The 2018 tournament final was watched by 99.6 million people. The venues for the preliminary and final rounds move around the world between large arenas. The 2022 Finals took place in the Chase Center, home of the Golden State Warriors. It is a huge business.

Counter-Strike: Global Offensive, created by Valve Corporation, has a series of championships known as Majors. The prize pool has grown from $250,000 at the first Major event in 2013 to $2 million in 2022. 

Sportsbooks see tremendous growth opportunities in the field. Sports betting itself grows mostly by virtue of more states legalizing it. But the absolute growth in the field is more about converting bettors from offshores and such to legal books. The esports betting story is one of straight growth, however. States recognize this as more and more are now explicitly legalizing esports betting and loosening regulations. Sites themselves are ready to pounce the moment they can legally post odds.