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Hawkish Iowa Betting Proposal Would Kill Two Birds With One Stone

iowa mascot herky the hawk waving a university of iowa flag

Iowa was among the second wave of legal sports betting states when it launched its brick-and-mortar and online sportsbooks back in August 2019, roughly 15 months after the overturn of PASPA.

Since then, Iowa has seen its move into sports gambling pay off handsomely, as the market was immediately popular. You can review the numbers for yourself by using our comprehensive Sports Betting Revenue Tracker.

However, there are some oversights and issues with the current state of affairs re Iowa sports betting.

First and foremost, residents must be 21 or older in order to wager domestically in IA, which is less than ideal for those aged 18-20.

Of course, for these younger bettors, legal international sports betting sites accept members at 18 and up, obviating the need for domestic options. Plus, they tend to have better odds across the board for most contests.

Secondly, IA sports wagering laws don’t allow bets to be placed on in-game NCAA action.

This is a nod to the “anti-corruption” betting theory that was once a part of PASPA, but it has no functional basis in reality and only serves to limit betting handle on one of the most popular betting markets going.

Again, overseas sites allow live college sports betting, giving them another significant edge over domestic IA sportsbooks.

Thirdly, and perhaps most damningly, Iowa does not allow gambling on eSports.

This was an obvious oversight when the initial 2019 betting bill was passed and signed, though lawmakers might be forgiven for not understanding the nascent market in granular detail.

While eSports wagering is not commonplace in the media (because eSports itself is not commonplace in the media), it is – and has been for several years now – the fastest-growing betting category in the entire world.

Consider: Each year, more people watch the Dota 2 World Championships – aka The International – than watch the Super Bowl!

(And that’s true even when the Super Bowl isn’t a ratings disaster like it was in 2021.)

Naturally, the eSports gambling market is extremely well-represented at offshore sports betting sites, cannibalizing the local IA industry considerably.

A fourth point against IA sports betting as it currently exists is that the law does not allow for betting on ancillary sports-related events, like drafts, trades, awards ceremonies, contract props, and so on.

But again, all these popular markets are commonly available at the best online sportsbooks operating overseas.

Still, credit where credit is due: Iowa indeed seems to recognize its betting market shortcomings, and recent legislation is aimed at remedying some – though not all – of these lapses in judgment.

Iowa House Study Bill 200 (HSB200) was introduced on February 10, and it has already been heard in its first subcommittee hearing.

Given that it’s a study bill, action on its salient points will be necessarily slow and drawn out. However, those salient points are all good ones, and they’re all desirable from a bettor and operator standpoint.

Here’s what HSB200 would change in the IA lawbooks concerning existing sports betting law:

  • Allows for eSports betting by adding a new subsection to Section 3, 99F.1 called 10A, or “Electronic sports event.”
  • Allows for betting on ancillary sports-related events by adding a new subsection to Section 3, 99F.1 called 27A, or “Sports-related event.”

The proposed new Iowa betting markets are defined in HSB200 this way:

Electronic sports event“a multiplayer video game event governed by a recognized professional, international, or collegiate video game governing body.”

Sports-related event“an event that takes place in relation to an authorized sporting event, but that is not tied to the outcome of a specific athletic event or contest as authorized by the commission.” Cited examples include “professional sports drafts and individual player awards.”

These, too, have caveats.

Like all domestic sports betting in Iowa, bettors may only wager on participants in the above provided that those participants are at least 18 years of age.

This means that if a player is under 18 and is included in a draft (most commonly the MLB draft), that player could not be wagered on within IA borders.

Similarly, if a professional eSports gamer is under 18 years old, he or she may not be wagered on, nor could matches in which they participate.

These limitations do not exist offshore, and though they’d be uncommon occurrences, more than a few bettors will likely look to such sites as a result, at least during the relevant events.

The proposed alterations to Iowa law also do not change the state legal betting age of 21, nor do they allow for live betting on NCAA sports.

However, the addition of eSports is a no-brainer, and it’s by far the most meaningful change suggested.

And that’s before you account for the 2020 coronavirus impact that shut down all traditional sports while eSports – and eSports betting – continued to flourish.

Overall, HSB200 is a solid revision of the existing Iowa sports betting legislation, introducing a wildly popular new market while expanding the prop bet selection and betting event selection of traditional sports substantially.

We foresee the amendments meeting little resistance and being implemented sooner rather than later, likely sometime in 2022.

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