Over the course of the 2024 US presidential election, Polymarket users bet over $3.6 billion on the election outcome itself and another $270 million on the results of swing states. According to the American Gaming Association, 23.3 million Americans bet an estimated $4.3 billion on the 2024 Super Bowl. According to Statista, the E-sports Betting market revenue is expected to reach $2.8 billion in 2025 worldwide.
In 2020, the value of the online casino industry worldwide was $48.55 billion. In 2024, the online casino industry expanded by 201.2%, its value growing to $97.71 billion. The industry is expected to increase its worth to $107.70 billion in 2025.
With the growth in sports and esports betting, online casinos, and even election betting on prediction markets, adults are more addicted to gambling than ever — the revenue of the post-pandemic online gambling industry only continues to grow. But why?
Illustrated by Angie Che
Written by Jasmine Li & Alice Zhao
Edited by Catherine Qin
Practices/Trends/Policies that Encourage Gambling — What brought us here?
With the introduction of COVID-19 and its ensuing pandemic, brick-and-mortar casinos and live sports became harder to access. As a result, these gamblers started to look towards other sources of entertainment to meet their needs, finding an expansive array of online gambling games, ranging from virtual slot machines and roulettes to E-sport betting.
The introduction of cryptocurrency into the gambling industry has made it even more attractive to some. Buying cryptocurrency, such as Bitcoin, in itself is a gamble because the price of cryptocurrency is constantly fluctuating. The loose regulation and decentralized transactions characteristic of cryptocurrency give users a false sense of anonymity, causing them to take riskier behaviors, such as gambling. Offshore gambling purchases are not as easily detectable and more convenient. Some casinos allow users to cash out online or through Bitcoin, making it harder to trace and easier to illegally gamble. In 2023, cryptocurrency users bet $3 million in crypto every day.
In 2018, the United States sports industry legalized sports betting. Following the Supreme Court’s ruling in NCAA v. Murphy, states were declared to have the sole power to legalize sports gambling within their territories by striking down the Professional and Amateur Sports Protection Act of 1992; afterward, they turned to gambling as an opportunity to offset federal budget cuts and deficits under COVID-19. 38 states have legalized gambling in 6 years. In Montana, the gambling industry contributes over 1% of its statewide revenue. In 2022, $70 million from taxes on sports betting went into Illinois’ education system in 2023.
The 2018 decision also meant that gambling sites could sponsor sports teams. Currently, of the 32 NFL teams, 21 are sponsored by gambling platforms, such as DraftKings, FanDuel, BetMGM, and Caesars Entertainment. Those four companies made up 60% of the total promotion expense at Super Bowl LVIII (58). Businesses that heavily profit from entertainment and ad revenue are having trouble dealing with the advertising demands of the booming gambling industry. Centralized systems, even on the federal level, have done little to limit the gambling industry’s prominence in the public domain, thus contributing to growing degrees of premature gambling exposure. For example, the NFL finally decided to limit the advertisement in live games to one ad per quarter in 2024, six years after sports betting became legal.
Even before NCAA v. Murphy, prominent modern gambling companies made good money hosting daily fantasy sports—a short-term variant of fantasy sports that allows users to wager money daily—instead of being committed season-long. In fantasy sports, participants draft team lineups of real players; the virtual teams perform according to the actual statistical performances of the athletes during the season. The turbocharged version of fantasy sports was wildly accessible—online hosts enabled “playing” from anytime, anywhere, and the short-term commitments contributed to a culture of convenience—welcoming new players daily. Nowadays, online gambling sites offer the same kinds of incentives with little regulation. In some instances, bonuses are handed out after a player loses, enabling them to continue betting and engaging with the website. Companies dole out promotional bets, promising to match users’ losses or give them free bets to begin with, costing states more than $120 million in potential taxes yearly.
An exit offered to problem gamblers is self-exclusion, a voluntary practice that allows individuals to ban themselves from entering physical gambling venues or online platforms, and be prohibited from collecting winnings or recovering losses. Despite the industry’s promise to protect betting addicts through self-exclusion systems ever since physical casinos opened, many report that there are staggering problems in the new institutions targeted at regulating unhealthy online gambling. Some companies, like GAMSTOP, which launched in 2018, offered exclusion systems that were easy to bypass by changing user details or setting up a new account.
The United Kingdom, which parallels the US in its prominent gambling industry, regulates all online gambling under a centralized system. In the UK, a self-exclusion request for one app bans the user from all other online gambling platforms. However, American problem gamblers must submit ban requests individually for each app, such processes sometimes even include writing letters. In general, the decentralized American system creates inconsistent protections for players from state to state. Convoluted regulatory frameworks in the US discourage self-help among problem gamblers and increase company risk of non-compliance.
Impact
Gambling’s portrayal in the media is overwhelmingly positive due to advertisement techniques such as celebrity partnership and promotion of bright gameplay; these techniques are notably attractive to adolescents. Similar marketing strategies targeting teenagers, employed by cigarette/nicotine-product companies, have been scrutinized by critics, prompting penalization and regulation in the industry. In 1999, the United States filed a lawsuit (United States v. Phillip Morris) against major cigarette manufacturers for engaging in a decades-long conspiracy to deceive customers about the health consequences of smoking. Corrective signs on smoking health effects began to be posted in 2023. That same year, Juul settled a $462 million lawsuit for deceptive marketing targeted at adolescents, including giveaways at concerts, “fun flavors”, and sleek, concealable designs. Throughout the decades, with the aid of the government to create regulatory frameworks, the cigarette and e-cigarette industries have been held to higher standards, especially on the issue of adolescent-targeted marketing. This is yet to be seen in the young, but vigorous online gambling industry.
With the flood of gambling advertisements into the public domain—spaces with considerable youth audiences, such as sports, live streaming, or video games—people are beginning to worry about the consequences of exposure on children. Sarah Clark, a University of Michigan pediatrics scientist, points out that “[online gambling] feels like games kids have been playing on their phones, including features like bonus points and rewards.” Familiarity with games blurs the line between playing for fun and betting for money. In fact, the age of onset for gambling has dropped significantly such that “approximately 70 percent of kids between the ages of 12 and 17 have gambled at least once in the past year” — the highest percentage in America’s history, according to the Executive Director of the National Council on Problem Gambling, Keith Whyte.
Moreover, streaming platforms are lessening restrictions on the livestreaming of gambling. The live-streaming platform Kick, for example, allows creators to have partnerships with online gambling sites; these creators often receive betting money from these companies to continue betting when they lose, creating a false appropriation of the expected payout to impressionable audiences. Without a balanced portrayal of the risks associated with gambling, the media fuels a decades-long cycle of generational addiction, ensuring the future success of the industry.
Furthermore, problematic gambling trends impact low-income populations at a disproportionate rate compared to higher-income gamblers. Personal factors such as grief, loss, or economic struggle motivate gambling, which are hardships more prevalent among lower-income populations, and have generally been on the rise after COVID-19. The legalization of online gambling has increased irresponsible betting behavior, defined as spending at least 10% of income on betting, more among lower-income gamblers than higher-income gamblers, a UCSC study revealed.
Ultimately, gambling affects the release of dopamine, the hormone that is linked to feelings of pleasure and rewards. Partaking in betting and playing casino games can often lead gamblers to feel extremely excited when anticipating the “highs” of winning but experience very intense “lows” when they lose, which causes them to seek out the rewarding feelings of “highs” through more gambling. This eventually turns into a vicious cycle that can alter the brain’s reward systems much like substance abuse does—making once-engaging activities feel less satisfying compared to gambling. The Royal College of Psychiatrists reports that people who suffer from gambling disorders may experience financial troubles, deteriorating relationships with their friends and family, low self-esteem, depression, substance abuse, anxiety, and difficulty participating in school or at work.
With the expansion of online gambling in the form of sports and esports betting, virtual casino games, and prediction markets, the rate of gambling addictions is higher than ever. It’s important to recognize the risks of online gambling despite its allure, especially for at-risk groups such as minors and low-income populations. Realizing when a website or company is encouraging gambling, acknowledging the detrimental effects of gambling, and seeking professional help when exhibiting the warning signs of gambling addiction are all steps that individuals can take to decrease the amount of harm that can come with excessive gambling—or avoid them altogether. Because of its relatively short lifespan, there is limited regulation governing online casinos, especially those located offshore. Encouraging governments to develop legal frameworks to address and prevent online gambling from turning into a problem for any of its citizens will also lessen the risk of problematic gambling behaviors.
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