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Can Illinois Overtake Nevada As The US’s Second Largest Sports Betting Market?

The December 2020 numbers are in for Illinois sports betting, and the state finished the year strong. How strong? December saw the state hit $491.7 million in handle, $125.4 million in revenue, and generated $20.1 million in state taxes.

The nearly half-billion dollars of wagers set a new record for the Land of Lincoln, beating its record of $449.2 million from just one month prior. It was also the fourth-highest number among all states with legalized sports betting, trailing only New Jersey ($996.3 million), Nevada ($588.4 million), and Pennsylvania ($548.5 million).

Based on its trajectory, Illinois is likely to run down Pennsylvania and Nevada in the not too distant future.

Inside the December Revenue Numbers

Illinois sports betting officially launched on March 9, 2020. The debut was short-lived, as the industry was suspended a week after until June 18, due to COVID-19. When it returned, the moratorium on remote registration was rescinded through an executive order from the governor. Each month has seen an increase in handle from the month prior.

July was the first full month that online sportsbooks were open, and over $52 million total was wagered, a number that nearly tripled the August tally of $140 million. Fast forward to the end of the year, and December’s total of $491.7 million is nearly 10-times the state’s August tally.

A month-over-month chart of Illinois online wagers has been provided below for complete reference:

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Watch Your Back Pennsylvania

Given the state’s growth through 2020, Illinois is on track to overtake Pennsylvania and make its way into the number-three spot shortly.

Despite both states having almost equal populations, Illinois has amassed a near-equal demand in less than a year of operation.

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By comparison, Pennsylvania legalized online sports betting in November 2018 and only surpassed $500 million in wagers in October 2020.

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More Illinois Online Sportsbooks Set to Open in 2021

Five sportsbooks are already currently open in Illinois, and more still will have the opportunity to join those primary operators mentioned. That number could quickly rise to double digits (Pennsylvania currently has ten operational sportsbooks). When it does, Illinois could legitimately challenge Nevada for the number two spot on the list of nationwide online sportsbooks.

But how competitive the market will be is still an open question.

As seen in the numbers from the Illinois Gaming Board’s revenue report, three operators, FanDuel, DraftKings, and BetRivers, are responsible for the lion’s share of wagers.

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But more competition is on the way.

After a roughly five-month drought since a new online sportsbook opened its virtual doors for business, several prominent casino entities are expected to launch in 2021.

Penn National Gaming recently announced its desire to launch its branded Barstool Sportsbook in time for March Madness. According to CEO Jay Snowden, “Our next to launch state will be in Illinois, where we plan to go live before March Madness, pending regulatory approval, of course.”

BetMGM and Unibet have also announced plans to enter the Illinois market this year. BetMGM has been gaining market share in several other sports betting jurisdictions and should provide immediate competition for Illinois’s current heavyweights.

College Sports Wagers Coming to Illinois?

Current state law prevents Illinoisans from placing any wagers on in-state collegiate teams across all sports. However, that could change, as State Rep Michael J. Zalewski has proposed legislation to repeal the prohibition on such bets.

In December, 34% of all sports bets made in Illinois ($167.2 million) were made on college sporting events. Opening the market up to in-state schools would almost certainly lead to a significant increase in college betting, particularly if Zalewski’s bill passes prior to March Madness. One reason being, the University of Illinois is currently the number-five ranked team in the nation and could end up as a number-one seed by the time The Big Dance arrives.

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