Sports betting is the activity of predicting sports results and placing a wager on the outcome.
Sports bettors place their wagers either legally, through a bookmaker/sportsbook, or illegally through privately run enterprises referred to as "bookies". The term "book" is a reference to the books used by wage brokers to track wagers, payouts, and debts. Many legal sportsbooks are found online, operated over the Internet from jurisdictions separate from the clients they serve, usually to get around various gambling laws (such as the Unlawful Internet Gambling Enforcement Act of 2006 in the United States) in select markets, such as Las Vegas, or on gambling cruises through self-serve kiosks. There are different types of legalized sports betting now such as game betting, parlays props and future bets. They take bets "up-front", meaning the bettor must pay the sportsbook before placing the bet. Due to the nature of their business, illegal bookies can operate anywhere but only require money from losing bettors and do not require the wagered money up front, creating the possibility of debt to the bookie from the bettor. This creates a number of other criminal elements, thus furthering their illegality.
There have been a number of sports betting scandals, affecting the integrity of sports events through various acts including point shaving (players affecting the score by missing shots), spot-fixing (a player action is fixed), bad calls from officials at key moments, and overall match-fixing (the overall result of the event is fixed). Examples include the 1919 World Series, the alleged (and later admitted) illegal gambling of former baseball player Pete Rose, and former NBA referee Tim Donaghy.
Main article: Bookmaker
The bookmaker functions as a market maker for sports wagers, most of which have a binary outcome: a team either wins or loses. The bookmaker accepts both wagers, and maintains a spread (the vigorish) which will ensure a profit regardless of the outcome of the wager. The Federal Wire Act of 1961 was an attempt by the US government to prevent illegal bookmaking. However, this Act does not apply to other types of online gambling. The Supreme Court has not ruled on the meaning of the Federal Wire Act as it pertains to online gambling.
Bookmakers usually hold an 11–10 advantage over their customers—for small wagers it is closer to a 6–5 advantage—so the bookmaker will most likely survive over the long term. Successful bookmakers must be able to withstand a large short term loss. (Boyd, 1981)
Many of the leading gambling bookmakers from the 1930s to the 1960s got their start during the prohibition era of the 1920s. They were often descendants of the influx of immigrants coming into the US at this time. Although the common stereotype is that these bookies were of Italian descent, many leading bookies were of eastern European ancestry.
Odds for different outcomes in single bet are presented either in European format (decimal odds), UK format (fractional odds), or American format (money line odds). European format (decimal odds) are used in continental Europe, Canada, and Australia. They are the ratio of the full payout to the stake, in a decimal format. Decimal odds of 2.00 are an even bet. UK format (fractional odds) are used by British bookmakers. They are the ratio of the amount won to the stake – the solidus "/" is pronounced "to" for example 7/1 "seven to one". Fractional odds of 1/1 are an even bet. US format odds are the amount won on a 100 stake when positive, and the stake needed to win 100 when negative. US odds of 100 are an even bet.
|Decimal||Fractional||US||Hong Kong||Indo||Malay||Implied probability|
|1.50||1/2||−200||0.50||−2.00||0.50||1 in 1.5 = 67%|
|2.00||Evens (1/1)||+100||1.00||1.00||1.00||1 in 2 = 50%|
|2.50||6/4||+150||1.50||1.50||−0.67||1 in 2.5 = 40%|
|3.00||2/1||+200||2.00||2.00||−0.50||1 in 3 = 33%|
|Decimal||Fractional||x-1, then convert to fraction|
|Decimal||US||100*(x-1) if x>2; -100/(x-1) if x<2|
|Fractional||Decimal||divide fraction, then x+1|
|Fractional||US||divide fraction, then 100*x if x>=1; -100/x if x<1|
|US||Decimal||(x/100)+1 if x>0; (−100/x)+1 if x<0|
|US||Fractional||x/100, if x>0; -100/x, if x<0|
|Hong Kong||Indo||x if x>=1; (1/x)*-1 if x<1|
|Hong Kong||Malay||x if x<=1; (1/x)*-1 if x>1|
In Asian betting markets, other frequently used formats for expressing odds include Hong Kong, Malaysian, and Indonesian-style odds formats. Odds are also quite often expressed in terms of implied probability, which corresponds to the probability with which the event in question would need to occur for the bet to be a break-even proposition (on the average).
Many online tools also exist for automated conversion between these odds formats.
In setting odds, the bookmaker is subject to a number of limitations:
In many countries, bookmaking (the profession of accepting sports wagers) is regulated but not criminalized.
The opinions of betting from sport authorities are mixed. The United States National Football League was previously fully against any sort of legalization of sports betting prior to the late 2010s, strongly protesting it as to not bring corruption into the game. On the other hand, the CEO of the International Cricket Council believe sports betting, in particular in India, should be legalized to curb illegal bookies where match fixing has occurred from nontransparent bookmakers. According to the Law Commission of India, all forms of gambling are illegal. Online sports betting is a gray area and is not banned by any particular law in the Indian legal system. That is because specific provisions distinguish between games of chance and games of skill.
Main article: Gambling in the United States § Sports betting
In the United States, it was previously illegal under the Professional and Amateur Sports Protection Act of 1992 (PASPA) for states to authorize legal sports betting, hence making it effectively illegal. The states of Delaware, Montana, Nevada, and Oregon—which had pre-existing sports lotteries and sports betting frameworks, were grandfathered in and exempted from the effects of the Act. PASPA was struck down by the Supreme Court in Murphy v. National Collegiate Athletic Association in 2018, paving the way for other states to legalize sports betting.
In May 2020, it was reported that since the Supreme Court's PASPA decision, over $20 billion had been spent on sports betting in the United States. As of May 2022, 30 states and Washington, D.C. have operational legalized sports betting, while an additional four states have legalized it, but have not yet launched legal sportsbooks.
The positions of the four major American sports leagues (representing American football, baseball, basketball, and ice hockey) have become more complex since their decision to embrace daily fantasy sports (DFS) in 2014, which are described by those within the industry as "almost identical to a casino" in nature. With the contention by critics that such activities blur the lines between gambling and fantasy sports, the endorsement of all four major sports leagues and many individual franchises provided a marked contrast to their positions on betting. Professional sports leagues updated their positions again on May 14, 2018, when the Supreme Court of the United States overturned the Professional and Amateur Sports Protection Act of 1992 (PASPA).
While the National Basketball Association (NBA) was once active in preventing sports betting law relaxation, current NBA Commissioner Adam Silver became the first major sports leader to break from previous administrative opposition to gambling. In 2014 he stated in a New York Times op-ed, "I believe that sports betting should be brought out of the underground and into the sunlight where it can be appropriately monitored and regulated." In 2017, with support for legalization growing, he confirmed his belief that "legalized sports betting is inevitable".
Silver released the following statement following the Supreme Court's overturning of PASPA: "Today's decision by the Supreme Court opens the door for states to pass laws legalizing sports betting. We remain in favor of a federal framework that would provide a uniform approach to sports gambling in states that choose to permit it, but we will remain active in ongoing discussions with state legislatures. Regardless of the particulars of any future sports betting law, the integrity of our game remains our highest priority."
Major League Baseball (MLB) Commissioner Rob Manfred has also advocated the league changing its stance on sports betting, with both Manfred and Silver noting that the scale of illegal sports betting makes opposition to betting meaningless. He also stated a willingness to "try to shape" any future legislation at federal level. This was noted as a marked contrast to former Commissioner of the MLB Bud Selig, with Manfred going beyond tacit approval and stating, "There is this buzz out there in terms of people feeling that there may be an opportunity here for additional legalized sports betting."
MLB released the following statement when the Supreme Court overturned PASPA: "Today's decision by the United States Supreme Court will have profound effects on Major League Baseball. As each state considers whether to allow sports betting, we will continue to seek the proper protections for our sport, in partnership with other professional sports. Our most important priority is protecting the integrity of our games. We will continue to support legislation that creates air-tight coordination and partnerships between the state, the casino operators and the governing bodies in sports toward that goal."
In April 2022, league-owned television channel MLB Network launched Pregame Spread, a weekday afternoon show hosted by Matt Vasgersian dedicated to analysis of betting lines and other aspects of sports gambling.
The National Football League (NFL) remains the only sports league to maintain public opposition to sports betting, however critics have noted that with the move of the Oakland Raiders to Las Vegas in 2019, the NFL has positioned itself for legalization, while simultaneously contradicting its long-held position that sports betting in NFL markets would lead to potential match-fixing. Commissioner Roger Goodell agreed with Manfred in a July 2017 seminar that betting on in-game events, as opposed to the outcome of games, was a more palatable form of sports betting.
Like the NBA and MLB, the NFL issued a statement on May 14, 2018. It emphasized the league's commitment to protecting the integrity of the game: "The NFL's long-standing and unwavering commitment to protecting the integrity of our game remains absolute." Moreover, the NFL called on Congress to craft a Federal framework for regulated sports betting. "Congress has long recognized the potential harms posed by sports betting to the integrity of sporting contests and the public confidence in these events. Given that history, we intend to call on Congress again, this time to enact a core regulatory framework for legalized sports betting."
The National Hockey League (NHL) has not stated a public position for or against sports betting, with Commissioner Gary Bettman noting that they are smaller than the NBA and NFL and less vulnerable to negative issues as a result. The NHL was the first major professional league to place a team in Nevada, when the expansion Vegas Golden Knights took the ice in 2017: since then the league has signed sponsorship agreements with William Hill and MGM Resorts International that include betting partnerships and access to in-play data. Other clubs in states with legal sports gambling, such as the New Jersey Devils and Philadelphia Flyers, also have similar sponsorships with bookmakers.
Following other US professional sports leagues, the NHL acknowledged the Supreme Court's PASPA decision with an internal review of its policies. "The Supreme Court's decision today paves the way to an entirely different landscape – one in which we have not previously operated. We will review our current practices and policies and decide whether adjustments are needed, and if so, what those adjustments will look like. It's important to emphasize that the Supreme Court's decision has no immediate impact on existing League rules relating to sports wagering, and particularly, wagering involving NHL games."
Major League Soccer (MLS) the top soccer league in the United States and Canada has expressed sports betting as a possible way to gain popularity. Commissioner Don Garber has stated about sports gambling, " We have a project going on now to really dig in deeply and understand it. I’ll join the chorus of saying it's time to bring it out of the dark ages. We’re doing what we can to figure out how to manage that effectively."
The Alliance of American Football and XFL have both publicly endorsed gambling on their games, with the AAF securing a partnership with MGM Resorts International and the XFL partnering with DraftKings.
The American Gaming Association stated in June 2017, that a coalition will advocate for the repeal of the United States' sports betting ban.
In February 2018, a lobbying document surfaced advocating a new position held by the NBA and MLB – that sports leagues should be financially compensated for betting activity.
Perhaps the most extreme ban on sports betting is imposed by the NCAA, the main governing body for U.S. college sports. The NCAA reified their position in the wake of various betting scandals, including the 1992 University of Nevada, Las Vegas and 1994 Arizona State University Point shaving scandals. As states began legalizing sports betting in the late 2010s, the NCAA signaled a shift in tone. In 2017, then-NCAA President Mark Emmert talked about Las Vegas possibly hosting the NCAA Division I men's basketball tournament in the future.
Emmert acknowledged the Supreme Court's overturn of PASPA on May 14, 2018, restating the NCAA's strong commitment to competition and its student-athletes. "Our highest priorities in any conversation about sports wagering are maintaining the integrity of competition and student-athlete well-being." Emmert also emphasized the importance of proper federal regulation. "While we recognize the critical role of state governments, strong federal standards are necessary to safeguard the integrity of college sports and the athletes who play these games at all levels."
Three days after the Supreme Court ruling, the NCAA suspended its policy prohibiting championship events from being held in states with legal sports betting. The policy was fully rescinded in May 2019. In October 2020, Las Vegas was awarded the West Regional of the 2023 Division I men's basketball tournament; the Frozen Four, the final phase of the Division I men's hockey tournament, in 2026; and the men's basketball Final Four in 2028.
As of the 2021–22 school year, the official manuals for all three NCAA divisions still expressly ban a member institution's athletic department staff, non-athletic staff with responsibilities related to athletic activities, athletic conference staff, and student athletes from knowingly participating in sports wagering activities.
This ban covers all competitions, whether intercollegiate, amateur, or professional, as well as team practices, in any sport in which the NCAA conducts a championship, plus Division I FBS football (whose championships have never been operated by the NCAA) and all sports within the scope of the NCAA Emerging Sports for Women program. The only exception is traditional wagers between institutions, most commonly associated with rivalries or bowl games; according to the NCAA, "items wagered must be representative of the involved institutions or the states in which they are located."
The NCAA maintains that "Sports wagering has the potential to undermine the integrity of sports contests and jeopardizes the well-being of student-athletes and the intercollegiate athletics community. It also demeans the competition and competitors alike by spreading a message that is contrary to the purpose and meaning of 'sport.'"
The Football Association, the governing body for association football in England, has imposed football betting bans on all individuals involved in the sport—players, managers, match officials, and club staff. The scope of these bans varies based on level of the English football pyramid.
The following individuals are banned from betting on any football-related matter worldwide, or providing inside information to any individual who can reasonably be assumed to use said information for betting purposes:
Individuals who are associated at clubs at lower levels of the men's or women's league systems, plus match officials at FA Level 4 or below, are only banned with respect to the match or competition in which they are involved or can influence, and also to the league in which they participate.
All individuals are banned from advertising or promoting any football betting activity in which FA regulations prohibit them from engaging. This, however, only applies to individuals in their personal capacities. For example, if a club is sponsored by a betting company and said company places its logo on the club's kit, the team's players are not in violation of the betting rules.
The World Baseball Softball Confederation, the international governing body for baseball and softball, has betting rules similar to those of Major League Baseball. Participants in any WBSC-sanctioned event are banned from betting on the following:
The WBSC statutes define "participant" as any player, team staff member (including coaches/managers), tournament official (such as umpires and official scorers), or anyone in an ownership, executive, or staff role within any entity that organizes or promotes a WBSC-sanctioned event.
The betting ban, as in the case of The FA's rules outlined above, also extends to providing inside information that the tipper could reasonably believe will be used to bet on a WBSC event.
The International Cricket Council imposes a blanket ban on what it calls "corrupt conduct" by anyone it defines as a "participant".
Under the ICC anti-corruption statutes, a "participant" is defined as:
The ICC shares anti-corruption jurisdiction with national cricket federations, all of which have anti-corruption rules substantially identical to those of the ICC. The ICC has elaborate mechanisms for determining whether it or a national federation will take action under the relevant anti-corruption code. In general, the ICC has either exclusive or priority jurisdiction over international matches, while national federations have responsibility for actions relating only to domestic matches.
The ICC code bans the following activities with regard to any international match, whether or not the participant had any involvement in said match, or any possible means of influencing the outcome:
In 1919, the Chicago White Sox faced the Cincinnati Reds in the World Series. This series would go down as one of the biggest sports scandals of all time. As the story goes, professional gambler Joseph Sullivan paid eight members of the White Sox (Oscar Felsch, Arnold Gandil, Shoeless Joe Jackson, Fred McMullin, Charles Risberg, George Weaver, and Claude Williams) around 10,000 dollars each to fix the World Series. All eight players were banned from playing professional baseball for the rest of their lives. Pete Rose, the all-time MLB leader in hits, was similarly banned from baseball in 1989 for betting on games while he was an MLB manager.
The rule against gambling in baseball is known as "Rule 21", which is publicly posted on dugout walls and states: "Any player, umpire, or club or league official or employee, who shall bet any sum whatsoever on any baseball game in connection with which the bettor has a duty to perform shall be declared permanently ineligible." People permanently banned from Major League Baseball are also forever banned from entry into the Baseball Hall of Fame, although most such people have been reinstated a few years later by a later Commissioner of Baseball. For instance, Mickey Mantle and Willie Mays were both banned from baseball in 1983 after taking jobs as casino greeters (which would have expelled them from the Hall of Fame had it been allowed to stand); they were reinstated two years later. Only Rose has yet to be reinstated.
A 1906 betting scandal between the Massillon Tigers and Canton Bulldogs, two of the top teams in professional American football in the early 1900s, led to the demise of "big-money" professional football for several years. Modern research has suggested that the claims of betting were unsubstantiated.
On December 7, 1980, the San Francisco 49ers overcame a halftime deficit of 28 points in what became the greatest regular season comeback victory in NFL regular season history. By the beginning of the third quarter, notorious Vegas bookmaker Frank Rosenthal received forfeiture notices from 246 San Francisco bettors totaling more than $25,000 in premature winnings. Rosenthal was able to retain these winnings despite the outcome of the game due to gambling regulations previously established by the NAGRA.
The Cronje Affair was an India-South Africa Cricket match fixing scandal that went public in 2000. It began in 1996 when the-then captain of the South African national cricket team, Hansie Cronje, was convinced by Mukesh "John" Gupta, an Indian bookmaker, to throw a match during a Test in Kanpur, India. The scheme was discovered when Delhi police recorded illegal dealings between Indian bookmaker Sanjay Chawla and Cronje. According to the Telegraph in 2010, Cronje was paid off a total of £65,000 from Gupta.
Corruption in tennis has been long considered as issue. In 2011, the former world No. 55 Austrian tennis player, Daniel Köllerer, became the first tennis player to be banned for life for attempting to fix matches. The violations were outstanding between October 2009 and July 2010 after The Tennis Integrity Units had launched an investigation on behalf of the International Tennis Federation and the ATP and WTA tours. In 2004 and 2006, Koellerer was banned for six months due to his bad behavior. In addition, in August 2010, he facilitated betting by placing odds for matches and had links for placing bets.
Machine learning models can make predictions in real time based on data from numerous disparate sources, such as player performance, weather, fan sentiment, etc. Some models have shown accuracy slightly higher than domain experts. These models require a large amount of data that is comparable and well organized prior to analysis, which makes them particularly well suited to predicting the outcome of Esports matches, where large amounts of well structured data is available.
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