US residents placed bets worth $140 million (in total) during the 2017 Super Bowl, however this figure does not take into account the betting activity that takes place in black markets.
Sports betting is not legal in all 50 US states, but large amounts are wagered through underground markets. Analysts estimate that around $5 billion worth of underground betting takes place during the Super Bowl, which is America’s most popular sporting event.
With the exception of the US state of Nevada, which is famous for its casinos, sports betting is not permitted in the majority of US states. However, a Supreme Court ruling made last year appears to be in favor of allowing betting in certain cases. There are also several decentralized platforms available now that seemingly make it easier to place bets using cryptocurrencies.
Notably, a large number of decentralized applications (dApps) have been developed and most of the popular ones involve gambling. Bitcoin (BTC), the flagship cryptocurrency, has evolved over the years and there are many use cases for it. But when bitcoin was first introduced, one of the first apps to use the cryptocurrency was a gambling app called “Satoshi Dice.”
Cryptocurrencies have certain characteristics that tend to make them appealing to online casinos. These include their pseudonymity and the ability to easily conduct cross-border transfers with cryptos – without requiring a bank or any other third-party. Currently, there are many online sportsbooks and betting platforms that accept major cryptocurrencies including bitcoin, bitcoin cash (BCH), ether (ETH), and Dash (DASH).
Cryptocurrencies Offer More Financial Privacy
While it’s difficult to accurately estimate the size of the US black market for sports betting, some analysts believe it’s well over $80 billion per year. Notably, there are many overseas sports betting platforms that currently accept wagers from US-based residents. Although payments can be made using credit cards, it can be easy to verify the identity of the card owner.
Paying with cryptocurrencies might help users avoid detection, however customers are still required to complete a registration process when accessing a centralized online sportsbook. As part of the sign-up process, users have to provide their government-issued IDs or some other form of personal identification.
Decentralized gambling platforms, or prediction markets, offer an alternative to users who want to maintain their privacy. These platforms usually don’t require users to submit ID verification documents. During the initial coin offerings (ICO) craze of 2017, there were a number of decentralized sports betting sites that had surfaced. Some of these betting sites include Wagerr and Block Sports.
Augur’s “Death Pools” Draw Concerns From Authorities
Moreover, major blockchain-based platforms such as EOS and Tron are mainly being used to launch gambling-related dApps. Augur, an Ethereum-based predictions market platform, has also attracted many investors. Due to its decentralized implementation, there have been concerns that Augur’s prediction markets may be impossible to shut down or regulate. Malicious actors could take advantage of this by using Augur and other decentralized prediction markets to engage in illegal activities. Last year, concerns were raised about Augur’s “death pools” or “assassination markets” which allow users to anonymously place bets – meaning that someone could be motivated to commit a murder if they’re paid for it.
Recently, several Augur-based predictions markets were launched in order to bet on the outcome of Super Bowl LIII, however none of these markets have received more than $20,000 in interest. The most active Augur-related market questions asked if people think the Patriots would win the Super Bowl. A “no” response means a user is betting that the Long Angeles Rams will win (Patriots’ opponent).
At present, a total of 330 ETH have been staked on Augur’s platform for the following question: “Will the Patriots defeat the Rams?” 54.6% of the bets have been placed in favor of the Patriots winning this year’s Super Bowl.
