Convince Me
New York Gov. Kathy Hochul hasn't shown much interest in online casinos, but with 200 policy initiatives to pay for, she may not have a choice.
The Bulletin Board
THE LEDE: NY Gov. is showing little interest in online casino legalization.
MIDWEEK ROUNDUP: More bills (a lot more bills).
NEWS: Michigan regulators and Churchill Downs don’t see eye-to-eye.
VIEWS: RSI in Delaware: A little effort and commitment can make a difference.
AROUND the WATERCOOLER: Trump appoints temporary CFTC Chair.
STRAY THOUGHTS: Be like water.
SPONSOR’S MESSAGE - Sporttrade was borne out of the belief that the golden age of sports betting has yet to come. Combining proprietary technology, thoughtful design, and capital markets expertise, our platform endeavors to modernize sports betting for a more equitable, responsible, and accessible future.
Sporttrade is now live in their fifth state; Virginia
The Lede: iGaming Omitted From NY State of the State
New York Gov. Kathy Hochul listed some 200 policy initiatives for 2025, but the legalization of online casinos was a notable absence.
As Sports Betting Dime’s Robert Linnehan noted, “In her address, Hochul proposed cutting middle-class taxes for more than 8.3 million New York taxpayers, sending inflation refund checks of up to $500 to over 8.6 million New York households, and expanding the state’s child tax credit to provide up to $1,000 per child to 1.6 million families.”
The question is, how does the governor plan to fund these initiatives?
State Sen. Joseph Addabbo Jr. cited online casinos as a source of revenue for the state, which he believes can reach $1 billion annually. Addabbo introduced online casino legislation yesterday, which can be found in the Midweek Roundup section below.
“How is she going to pay for this? I have an idea. I have a couple of ideas. Every year, I go into a budget with a little optimism, thinking to myself that if I was the governor, do I want to lose about a billion dollars every year to other states? To an illegal market? We used the same argument with online sports betting at the time, and you see the success we’ve had with that,” Addabbo told Sports Betting Dime.
Those comments are eerily similar to his comments following the governor’s 2024 State of the State Address:
“The governor did a fine job laying out the game plan about where she wants the state to go and what she wants the state to do. But, in that press conference and the executive budget, there’s no how to get these things accomplished or how to move forward,” Addabbo said. “That’s what the budget negotiations are for over January, February, and March. That’s where I’m hopeful we can have a conversation about iGaming.”
It’s a logical argument, but STTP believes the “we are leaving money on the table” argument is past its expiration date in New York. If the state (and stakeholders) hasn’t bought in yet, it won’t suddenly change the hearts and minds of those opposed to online casinos—although I expect lawmakers to tout it as the reason when they eventually pass legislation.
Standing in New York’s way are the still-to-be-awarded downstate casino licenses (and who receives them will play a big part in determining New York’s online casino future) and a governor who seems reticent to expand or speed up gambling expansion efforts.
Recall that mobile sports betting was passed during Andrew Cuomo’s tenure as governor. Hochul inherited this legislative framework.
Addabbo has previously pointed to Gov. Kathy Hochul as an obstacle, citing the governor’s lack of support for the failure of online casino efforts.
Hochul also vetoed a bill in November that sought to speed up the licensing timeline for downstate casinos.
Midweek Roundup: VA Update and bills in OK, MA, and NY
Virginia online casino bill already shelved for 2025: A Virginia online casino bill has been put on ice following a very short hearing in the House of Delegates. Virginia Del. Marcus Simon’s HB 2171 (a companion bill to State Sen. Mamie Locke’s bill, SB 827) “was “gently tabled,” and the committee will ask its work group to investigate the issue,” per SBC Americas. A fiscal note painted online casinos as bad for the state’s existing online lottery. Locke’s bill is slated for a hearing today and is expected to have the same fate.
Oklahoma gets a second sports betting bill: Republican state Sen. Casey Murdock has filed SB 164, a bill to legalize sports betting — State Sen. Dave Rader has also filed sports betting legislation. It's similar to a bill he filed in past years, endorsed by the governor, offering mobile and in-person betting. The problem remains an irreparable rift between Gov. Kevin Stitt and the state’s gaming tribes. Sports betting remains unlikely while Stitt is in office.
Massachusetts online casino bills: MA State Rep. Daniel Cahill and State Sen. Paul Feeney have introduced companion legislation (HD 4084 and SD 2240) to legalize online casinos in the state. The legislation uses a similar licensing structure to the state’s mobile sports betting law, allowing licensed casinos to operate two online casino brands plus a third online poker brand. It also allows online-only licenses for companies like FanDuel and DraftKings. A third bill is also coming (HD 2393), sponsored by State Rep. David Muradian, who worked on the NCLGS model legislation.
New York online casino bill has a sweepstakes clause: New York State Sen. Joseph Addaboo is back with another online casino bill (S 2614). Per Daniel Wallach, who has a copy of the bill, licensees would be available to casinos, VLTs, tribes, and online sports betting operators. The bill also has a clause aimed at sweepstakes operators, as it includes a “licensing ban if offered unlicensed games within last 3 years.” There’s a lot to this one (including RG mandates and earmarks for jobs and problem gambling treatment/research), STTP will have a deeper dive in an upcoming newsletter.
SPONSOR’S MESSAGE - Underdog: the most innovative company in sports gaming.
At Underdog we use our own tech stack to create the industry’s most popular games, designing products specifically for the American sports fan.
Join us as we build the future of sports gaming.
Visit: https://underdogfantasy.com/careers
News: Fight Brewing Between MI and Churchill Downs
When it comes to cease-and-desist letters, Michigan has an itchy trigger finger. For the first time, one of the recipients, Churchill Downs, is pushing back with legal action (sweepstakes operators initially appealed the decision but chose not to pursue legal action).
Michigan sent cease-and-desist letters to Churchill Downs and other advanced deposit wagering (ADW) operators in December. The letters stated that the operators were in violation of the Michigan Horse Racing Law, which requires ADW and simulcast racing to be associated with a Michigan track. The operators had until January 1, 2025, to cease operations.
As reported by Covers.com, “Xpressbet, NYRAbets, and TVG Network complied with the MGCB’s instructions, but Churchill Downs refused. On Dec. 31, TwinSpires notified the MGCB that it would continue to offer wagering services in the state.”
Shortly after the MGCB issued a summary suspension order on January 7, 2025, Churchill Downs filed a lawsuit in the US District Court of Western Michigan, claiming the suspension of ADW providers violates the Commerce Clause.
Per The Paulick Report, Churchill Downs argues that “a federal law regulating interstate simulcasting should preempt the Michigan Gaming Control Board from shutting down advance-deposit wagering.”
The Paulick Report goes on to say:
“The lawsuit claims a 2019 amendment to the state's horse racing law imposing new licensing requirements for ADWs (referred to in the law as "third-party facilitators") violate the Interstate Commerce Clause of the U.S. Constitution and also should be preempted by the Interstate Horseracing Act (IHA) passed by Congress in 1978 and amended in 2000 to specifically permit telephone and Internet betting.”
Views: Sometimes It Is About Product (and Effort)
For most of its ten-plus-year existence, Delaware was an online gambling afterthought, often cited as an example of the failings of lottery-run monopolies.
That changed when Rush Street Interactive took over from 888/EVOKE in January 2024. We now have a full year of data to look at, and as the two charts below indicate, the difference between the two operators is night and day.
Is RSI’s product that much better? Yes and no. The real difference is the effort RSI put into the market, quickly adding mobile betting options to what had been an appless market.
SPONSOR’S MESSAGE - SUBSCRIBE NOW to Zero Latency, the new podcast from Eilers & Krejcik Gaming that provides unparalleled insight into the U.S. online gambling industry through interviews with industry insiders and analysis from EKG experts.
Episode 60: Will The CFTC Shut Down Crypto.com Sports Markets?
Host Brad Allen is joined by EKG policy director Becca Giden to discuss:
Whether Robin Hood and Kalshi will follow Crypto.com in sports markets
Why EKG predicts zero new OSB or online casino states in 2025
Whether DraftKings’ subscription model will pass regulators
Around the Watercooler
Social media conversations, rumors, and gossip.
A temporary replacement for outgoing CFTC Chair Rostin Behnam has been named: Caroline Pham.
Of particular interest, Pham wrote the dissenting opinion for the CFTC’s Event Contracts Proposal back in May:
“I respectfully dissent from the Event Contracts Proposal because it takes the CFTC’s regulation of event contract markets backwards with its fundamental misunderstanding of how we regulate derivatives and the States regulate gaming. Instead of thoughtfully considering how to effectively regulate these markets while fostering innovation, the Event Contracts Proposal ties itself in knots over the bounds of gaming, which Congress has neither asked nor directed the Commission to regulate. I am simply disappointed in this wasted opportunity to regulate retail binary options, sidestepping our responsibility, and concerned about its legal impact.”
She also supports regulating and integrating cryptocurrencies within the US financial system.
Stray Thoughts
As we enter yet another of online casino legislative efforts and debate, I have two bits of advice for supporters:
"The oak fought the wind and was broken, the willow bent when it must and survived."
~ Robert Jordan ~
"Fall seven times, stand up eight."
~ Japanese Proverb ~