SPORTS BETTING IN FOCUS
AGA: Illegal Sports Betting Rates Among U.S. Gamblers Falls 33 Percent
While Americans continue to wager heavily with illegal bookies and offshore sportsbooks, the share of sports bettors exclusively using illegal sources has fallen by one-third, according to a new study from the American Gaming Association.
Since 2022, market share among illegal sportsbooks has dropped sharply from 35 percent to 24 percent, according to the study released on August 13. At the same time, roughly one of 10 bettors wager on sports exclusively through illegal channels, the study found.
All told, offshore sportsbooks and U.S. illegal bookies handle about $84 billion in illicit sports wagers, the AGA estimated in the study. The $5 billion in gross gaming revenues translates to about $1 billion in lost tax revenues, the association estimates. Later this month, one of the nation’s largest bookies will be sentenced in Southern California. Matt Bowyer, the bookie who handled $325 million in wagers from Shohei Ohtani’s ex-interpreter, is scheduled to be sentenced on August 29.
Last week, a group of state attorneys general led by Mike Hilgers of Nebraska and William Tong of Connecticut sent a letter to the Department of Justice on the enforcement of illegal gambling. In the letter, the group urged the Justice Department to pursue injunctive relief and website seizures under federal law.
Novig Closes $18 Million Series A Funding Round
Novig announced the close of an $18 million round of financing on August 11, disclosing the completion of the Series A round at a time when the nation’s largest sportsbooks have expressed interest in potentially adding a prediction markets offering.
Founded by two Harvard graduates, Novig is a peer-to-peer sports prediction market. Since Novig went live last year, the market has grown about 50x in monthly volume, the company wrote in a press release.
The round was led by Forerunner Ventures, a San Francisco-based venture capital firm, with participation from existing investors Y Combinator, NFX, Perceptive Ventures and Gaingels. Novig plans to use the new capital to expand coverage to additional sports, as well as deepen its presence in existing markets.
“What we’re building isn’t just sports predictions – it’s a true peer-to-peer market,” said Jacob Fortinsky, who serves as CEO of Novig. “This funding will allow us to scale our mission across more sports, more formats, and ultimately, to more users.”
McPeek, Other Panelists Push For Triple Crown Changes
The Racing and Gaming Conference at Saratoga this week took place about 15 furlongs from the historic Saratoga Race Track.
In June, Sovereignty captured the Belmont Stakes at Saratoga with a resounding victory in 2:00.69. While the Bill Mott-trained Sovereignty won two of the three legs in the 2025 Triple Crown, the victory is considered somewhat bittersweet since Mott opted to skip the second leg in The Preakness. The decision has raised questions on whether the spacing of the Triple Crown should be adjusted to give horses added time for recovery.
Since 1900, only 13 horses have won The Triple Crown.
Ken McPeek, trainer of 2024 Kentucky Derby winner Mystik Dan, appeared on the racing panel at the three-day event. McPeek is in favor of moving The Preakness back two weeks to the first weekend of June, while pushing The Belmont to the opening weekend of July. Author Steven Crist, another panelist, took more of a traditionalist view by supporting the status quo.
Earlier on August 12, Churchill Downs CEO Bill Carstanjen gave a luncheon keynote address at the conference.
Carstanjen emphasized that the Triple Crown is a “standard that has stood the test of time,” considering that the three races are contested over a span of just six weeks. On the other hand, he told GGB that horses don’t race as frequently or as close together as they once did. If any changes are made, the modifications likely will not be implemented until 2027 at the earliest.
Former Zero Edge CEO Indicted In Alleged Crypto Casino Scheme
The U.S. Attorney’s Office for the Eastern District of New York unsealed an indictment against a tech executive who allegedly misappropriated millions in investor funds to gamble with an online casino and sportsbook.
When Richard Kim founded Zero Edge in 2024, he purported to build an app-based casino using blockchain and cryptocurrency technologies. According to prosecutors, Kim instead misappropriated the proceeds of the company’s seed round to make speculative cryptocurrency trades and gamble on a casino website.
“As alleged, Kim misled investors by promising that he would build a blockchain-based casino gaming app, but ironically Kim turned around and gambled away the very funds he said he would use to build a better casino,” said U.S. Attorney Jay Clayton in a statement.
Shortly after closing on the approximately $4.3 million seed financing round, Kim diverted approximately $3.8 million of investors’ funds first into a personal cryptocurrency account held at Coinbase, prosecutors allege.
Then, over a six-day period last June, Kim allegedly made transfers of roughly $7 million from Coinbase and Kraken to a personal account held at Shuffle.com. Domiciled in Curacao, Shuffle bills itself as a VIP crypto casino and sportsbook. Kim also allegedly informed investors that he lost the funds as a result of a “treasury management strategy,” rather than from personal gambling.
Kim, 39, has been charged with one count of securities fraud and one count of wire fraud. Each charge carries a maximum sentence of 20 years in prison.
