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Explainer: Why is Congress Looking into Sports Betting – and How Far Will It Go?

Typically, Congress gives individual states the authority to regulate gaming. This is particularly true after the US Supreme Court ruled in 2018 that the Professional and Amateur Sports Protection Act, 1992 (PASPA), which forbade sports betting statewide (with a few exceptions), was unconstitutional.

Why, therefore, is Congress currently investigating sports betting?

Major integrity concerns have been raised by recent indictments of players in leagues like MLB and the NBA, who are accused of manipulating games or throwing patterns to profit from wagers.

MLB and other major leagues have been asked to provide comprehensive information regarding the steps taken to resolve these allegations by the Senate Commerce, Science, and Transportation Committee, which has officially launched investigations.

Separately, some legislators contend that a national industry cannot be managed by the patchwork of state regulations. Concerns include the rise in gambling addiction, particularly among young men, and aggressive marketing.

Does Congress Need to Be Involved at All?

Congress is currently considering whether a national response is necessary to protect consumers, preserve sports integrity, and plug regulatory gaps caused by the state-by-state approach, even though sports betting has historically been a state-level issue.

Congress still has extensive control over interstate commerce, even though states determine whether betting is permitted. Furthermore, there is no denying that contemporary sports betting is interstate.

Thus, the answer is yes. Congress may decide to actively regulate sports betting, outright outlaw it, or forbid specific kinds of wagers. It cannot, however, compel states to enact or implement laws on their own or, as was the case with PASPA, direct states to maintain their own bans.

What's the Probable Result?

Recent betting scandals have brought attention to the practice of in-play "prop" betting, in which players wager on the specifics of a game rather than merely the outcome. Opponents claim that because it is simpler for an athlete to influence minor details of the game than the final outcome, the format fosters the perfect environment for match-fixing.

Could In-Play Betting Be Prohibited by Congress?

Legally speaking, since sports betting is an instance of interstate trade, the answer is yes. Probably not in terms of politics.

States that get tax revenue, sportsbooks, sports leagues that offer real-time data, and millions of bettors would all oppose a ban.

The bottom line

Rather, Congress is likely viewing this as an opportunity to establish a national regulatory "floor" for the sports betting sector, which would include regulations pertaining to responsible gaming, age verification, data reporting, and possibly specific restrictions on the riskiest types of in-play betting.