Is the $11 Billion Online Sportsbook Bubble About to Burst?

S hohei Ohtani walks up to home plate at New York’s Citi Field, and the L.A. Dodgers fans, who are well in attendance on this Wednesday afternoon, are up on their feet.

“So, ideally you get a pop-up, right? You got like five seconds in the air. God forbid the guy drops the ball.”

I’m sitting in the outfield with Scott Brody, who is not paying the fans around us any mind. He is intently studying the players in the outfield, as well as the cellphones he has in either hand, with sportsbook apps loaded up on each one and ready to fire. “So when that ball’s in the air, you can submit the under on the bet because the guy’s on second base. He’s not gonna score.” 

Brody is a large man, a former Division I football player, an Iraq War veteran, and a devoted surfer. Scott Brody isn’t his real name. It’s a pseudonym, and many of the other names in this story are as well. Brody is a gambler — a damn good one — and he’s so good he worries that if the sportsbooks knew his real name, they wouldn’t let him bet anymore. 

That may sound like an absurd boast, but it isn’t. Brody is what is known as a “courtsider,” and he is the bane of any sportsbook. He goes to live sporting events and bets on his phone — well, phones, because he has a few of them. He loads one with an over bet, one with an under, waits for a batter to get a hit and tries to press the right bet on his phone before the sportsbook can adjust the odds. Most people at home watch the game on a delay, so they can’t beat the sportsbook’s information. But in the ballpark, where someone from the sportsbook is also watching the game and adjusting the odds, you can, because you only need to beat that guy.

“You can see the left fielders just jogging. It’s already out of bounds. It’s already out,” Brody says, teaching me how to analyze the body language of the players to anticipate the result of a play faster than the sportsbook’s guy. “We got the infield in … but they’ve increased the chance of a hit by like 20 percent by being on the edge of the grass.” 

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Brody, like many, started taking betting more seriously during the pandemic. With a master’s in accounting and a knack for statistics, he got into sports modeling. After discovering sports-betting guru “Captain Jack” on YouTube, he studied and built his own predictive models. Within a few years, he was making enough to quit his job and gamble full time. “My goal is to be good enough to bet offshore and go back to being the world’s fourth-best surfer over 6’ 6″ in Hawaii.”

PASPA, which stands for the Professional and Amateur Sports Protection Act, was a law in the U.S. that prohibited sports betting, except in a few states, like Nevada. It was overturned by the Supreme Court in 2018, and ever since, sports gambling has exploded into the American zeitgeist. Ads for sportsbooks have dominated televised events, made their way into the stadiums and arenas of professional and collegiate sports alike, and even onto the jerseys of the athletes themselves. Talk of point spreads and totals, once taboo over the airwaves, are now not only common topics among the sports commentariat, but also displayed in the chyron scoreboards right on the screen. It seems like everyone who isn’t betting on sports likely has someone in their life who is. Revenues for sports-betting companies reached nearly $11 billion in 2023, up 44.5 percent from the year before.

“America can survive sports betting. It survived illegal betting for years.”

Las Vegas bookmaker Roxy Roxborough

The biggest among these are DraftKings and FanDuel, two companies that started out running Daily Fantasy Sports competitions, but moved quickly into sports betting post-PASPA to capture more than 70 percent of the market, leaving legacy casino brands like Caesars and MGM in their dust. They accomplished this by getting a head start on the competition with technology and customer acquisition, then investing heavily in marketing, saturating the airwaves with ads, and offering huge promotions to new customers. What accompanied that deluge and the ability for anyone to have a sportsbook in their pocket was a significant rise in gambling, including problem gambling, particularly among young men under 30, for whom problem-­gambling behaviors are three times more prevalent than the rate of the rest of the population. And then there are the scandals involving athletes gambling and sometimes even fixing games. This has given the impression that sports betting appeared out of nowhere and is corrupting sports. 

I have a different perspective. I’m from Hot Springs, Arkansas, which was once the gambling capital of America and remained a sports-betting hub well into the 1990s. As a kid, I had friends whose family members were bookies. Hell, there were bookies in the chamber of commerce. In college, I was too punk rock to go to football games, but never so much that I wouldn’t bet on them. Gambling, to me and mine, was something we did for fun, and something everyone we knew did. By the time the PASPA repeal happened, I was the proverbial frog in the boiling pot of water. I didn’t understand what all the fuss was about. 

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But beyond my own unique perspective, the fact is American sports and gambling have always been inextricably linked. The original professional baseball team owners would bet with one another on their teams. Early 20th-century bookmakers frequented the ballparks and stood in the stands, just like the one Brody and I were sitting in, and took bets from the gamblers who filled the seats. Until the NFL was popularized in the 1950s, the most popular sports in America were baseball, boxing, and horse racing, three sports associated with gambling. In fact, some of the earliest owners of football teams in America were gamblers or bookmakers themselves; from Tim Mara to Art Rooney, the original NFL owners had made their fortunes at racetracks, betting on baseball, or by bookmaking. Football saw its popularity skyrocket in postwar America, when televised sports and the invention of the point spread fueled a gambling boom so large it inspired congressional intervention. In 1950, Life magazine declared America “the gamblingest nation that ever existed.” 

Yet despite America’s deeply entrenched propensity to bet on sports, regulating gambling hasn’t panned out the way anyone had hoped. This year, a number of sportsbooks have pulled up stakes and left the business, choosing to eat the losses of costly licensing fees rather than continue on. In search of higher profits, some sportsbooks have started limiting gamblers whose bets win while accepting bets of any amount from those who stand to mostly lose, including problem gamblers, sending the winners back into the arms of the offshore sportsbooks and barroom bookies the regulated industry had promised to replace. Eye-popping endorsement deals and marketing budgets are being dramatically scaled back. State legislatures that once welcomed sportsbooks and their promises of tax-revenue windfalls with open arms have grown frustrated after those companies couldn’t deliver. After a cascade of 38 states adopted sports betting, voters and legislators in the states that have yet to come on board have pumped the brakes, with California, Georgia, and Texas all recently rejecting it. The tide appears to be receding.

For the past year, I traveled across the United States and Costa Rica to spend time with bettors, bookies, politicians, and athletes to take the temperature of the American sports-betting industry. I’d meet plenty more people like Brody — gamblers whose skills pose an almost existential threat to sportsbooks that pictured America as a nation of suckers. What I learned was that sportsbooks, state governments, and gamblers are all reconsidering a lot of what they assumed about this business, and that we just might be experiencing the beginning of the end.

Back at the ballpark, as Ohtani readies himself for the pitch, Brody readies a $500 bet.

Crack!

Brody smashes the button on the phone. A wheel spins. The ball sails deep into the rafters. A home run. The Dodgers fans around us are so loud you’d have thought the game was in Los Angeles. Brody isn’t cheering. He’s grimacing. The bet didn’t go through. The button man beat him this time.

“Ah, that sucked, man! That was a home run! Ohtani! We had that!”

Hawaii will have to wait.

“Under six and a half makes sense.” Captain Jack is sitting at the counter in the DraftKings sportsbook at Resorts Casino in Atlantic City, hunched over his iPad looking at a screen filled with numbers. “A lot of this adds up into a bet that seems reasonable based on everything I know.” He looks at his projections for strikeouts for Boston Red Sox pitcher Nick Pivetta, and compares them to the lines at DraftKings. The verdict: He likes it. The problem: DraftKings doesn’t like Captain Jack.

“Captain Jack” Andrews (not his real name) is in his forties, with the manic look of a mad professor who has been up all night working in his lab. In a sense, he has. He has a degree in chemical engineering and worked as an IT director at a law firm, but starting around 2008, he made more money gambling — counting cards, betting sports, hustling casino bonuses — than he did at his job. By 2012, he quit and became a full-time pro.

Andrews probably doesn’t fit your stereotype of a professional gambler. There’s no tracksuit, no pinkie ring. He’s a mild-mannered professional who you’d never cast a suspicious glance at. But despite his normal appearance, his life is quite remarkable. Andrews is blacklisted from casinos all over the world, and lots of sportsbooks won’t take his bets. His real name is a well-kept secret. Today in Atlantic City, he wears a baseball cap pulled down low over his eyes. “I’m keeping my head low like this because the camera is at the top of the kiosk,” he explains. Sure enough, a small camera is aimed directly at us, and a sign next to the kiosk warns that if we make multiple wagers on the same bet, our bets could all be voided. That’s a way for DraftKings to enforce betting limits on kiosks, which are anywhere from $100 to $250 in some cases. “I don’t think that is gonna hold up with the DGE,” he says, referring to New Jersey’s Division of Gaming Enforcement, “but this has been on there for over a year now.” We ignore it. We each bet $200 on Pivetta under 6.5 strikeouts and head off in search of the next kiosk to make the same bet.

“Everybody’s like, ‘Oh, you’re betting with a local bookie? Is it a mob guy?’ The stigma now has been removed. It’s an OK thing to do. There’s corporations behind it.”

Bill (pseudonym), who operates an offshore sportsbook

For Andrews to make any kind of bets on baseball props, something that has long been his bread and butter, he has to bet them at these kiosks. He can’t bet them at any of his online accounts, and he can’t go up to the window and risk being identified by the sportsbook as a professional. So he settles for $250 a pop because action is action. “I can’t bet a single penny on these at home,” he says.

Andrews may shield his face from kiosk cameras, but it is well-known online. If you’ve searched anything gambling-related on YouTube, you’ve likely seen him. He’s made more than 30 videos and countless livestreams to educate gamblers on how to make smart, or “sharp,” bets. Since PASPA, Andrews has become a public figure, teaching beginners and recreational bettors how to “lose less” and turning “Captain Jack” into its own persona and brand — sort of a gambler’s Carl Sagan. In his gentle and professorial delivery, his videos present a sharp contrast to the over-the-top pick-shilling sports-betting ­content online. 

“Too many people look at sports betting as a ‘get rich quick’ scheme. They want to bet a little to win a lot,” he says. “That naturally leads them into parlays and same-game parlays — bet types that give the house a 20 to 30 percent house edge.” Parlays are bets where multiple wagers are combined in order to create a bigger payout for a smaller investment. The more bets you combine, the more you can win, but the longer the odds.

Andrews says sports betting doesn’t need to be this way, and when players learn how to make smarter gambles, it’s better for everyone, including the sportsbooks. Bettors who lose right away are less likely to come back, which is bad for a sportsbook that spent a fortune to acquire them. “Our collective challenge, it’s not an industry secret, is retention,” said Adam Greenblatt, CEO of BetMGM, during an interview with journalist Contessa Brewer. Greenblatt says that while new players were the name of the game at first, now 90 percent of MetMGM’s growth is coming from current players betting more. Chris Capra from Caesars agrees: “If every operator in the state of New Jersey reactivated 10 percent of the base of customers that they already have, that is ­hundreds of millions of dollars in revenue to the state.” 

“A sports bettor who views it as a developing skill, the way one might approach poker or even chess, becomes a more sustainable bettor,” argues Andrews. “Sustainability is the tide that lifts all boats, from bettors to sportsbooks to state tax revenue.”

Along with Rufus Peabody (real name, believe it or not), one of the world’s top sports bettors, Andrews started Unabated, a company that provides bettors with tools like odds screens, simulators, and odds calculators to help them find an edge over sportsbooks. Gamblers like Brody have used Unabated to turn their hobby into something that earns enough to go pro. According to Unabated, many users make $30,000 to $100,000 a year betting on sports, with some earning “big six figures” full time.

Andrews estimates that less than one percent of U.S. sports bettors earn more than $100,000 annually. The major American sportsbooks apparently like it this way and want nothing to do with professionals. Jason Robins, DraftKings’ CEO and co-founder, once stated that sports betting “is an entertainment activity. People who are doing this for profit are not the people we want.” Since PASPA’s repeal, both the number of gamblers and the amount wagered has steadily grown. Today, 38 states, Washington, D.C., and Puerto Rico have some form of regulated sports betting, with five more joining last year. The American Gaming Association reported that in 2023 Americans wagered more than $119 billion on sports, up 27.5 percent from the year before. The majority of that sportsbook revenue — 65 to 80 percent, depending on the company — now comes from a small percentage of VIP customers, including high rollers who lose millions and potentially problem gamblers who lose more than they can afford.

This makes winners a problem for sportsbooks. And they’ve chosen to deal with it by placing strict limits on customers who demonstrate an ability to win over the long run, even if they lose in the short run. “I got limited by DraftKings in September 2018, less than 30 days after they went live in New Jersey. I was down $600. I wasn’t even betting a whole lot,” Andrews says. “I was betting second-inning lines. And the head trader at the time, who I later met, said, ‘I just knew because you were betting second-inning lines, you had to know what you’re doing.’ ”

“Regardless of if you’re a professional or not, if you do your homework and you actually have a chance to win or show the ability to win, you’ll be cut back,” says Mike Fulner (pseudonym), a well-respected, international professional gambler. 

Elihu Feustel, a professional sports bettor from Indiana who sometimes consults for sportsbooks to help them profile their players, agrees. “I can quickly identify 90 percent of winning players in the first 20 bets,” he tells me, indicating that he doesn’t look for whether they win or lose, but whether or not they made bets at a better price than where the market closed, something gamblers call “closing line value,” or CLV.

In the first couple of years after PASPA, limiting was something reserved for serious professionals — people like Andrews or Gadoon “Spanky” Kyrollos, who in the early days of legal sports betting in New Jersey gained notoriety exposing sportsbooks that were “kicking him out” by limiting his bets. Back then, Spanky was trying to bet tens of thousands of dollars a game. Today, sportsbooks have become so risk averse that they have extended this type of limiting to all levels of players, including me! During the course of reporting this story, after betting hundreds of dollars a game and winning at three different sportsbooks, my bets were limited, sometimes to as low as a penny a bet.

To give some context, this would never happen at an online casino where someone wanted to gamble on slot machines or blackjack (though for decades, brick-and-mortar casinos have treated blackjack card counters — people who can keep track of how many high and low cards are left in a deck to know when they are more likely to win — similarly). Casino games have odds set in stone and almost always favor the house. You can win short term, but long term, the house knows it will win. In sports betting, things are more dynamic. There’s a lot of information that is important to setting prices, like injuries, lineups, even weather, and the sportsbook has to compete with bettors for that information and to make sure they don’t end up flat-footed on any given bet — of which there are often thousands of options to keep track. 

Once upon a time, bookmakers managed this risk one bet at a time, always adjusting the odds and keeping track of which customers were more likely to win so they could use their bets to help figure out the right prices to set for the rest of the market. Today, some sportsbooks choose instead to move their odds “on air,” which is to say they simply copy another (often offshore) sportsbook’s lines. They profile winning players, but rather than use those players to their advantage, they limit how much they can bet. Everyone else can bet any amount they want, whether $100 a game or $100,000 a game. 

This practice is so widespread they have a name for it: “Ban or bankrupt.” Andrews has made exposing it a personal crusade. In May, he spoke at a roundtable on limiting organized by the Massachusetts Gaming Commission. Andrews had a captive audience, and the regulators took him seriously. 

The sportsbooks first issued canned statements defending their choice not to participate (DraftKings claimed their “risk management” was confidential), but then relented and showed up en masse to another round­table in September. At that meeting, FanDuel admitted to limiting players. “Some users may have more information than we do. Some users may have a better model than we do,” said Cory Fox, FanDuel’s vice president of product. “We’re comfortable taking wagers from them, but we have to do it in a responsible manner that protects our company.” 

DraftKings defended its practice of limiting during the roundtable as well, but claimed it doesn’t profile players as winners or losers, looking, instead, for the particular kinds of bets a person might be adept at. “When we’re talking about limiting, it’s limiting a behavior,” said Jake List, senior director of regulatory gaming compliance for DraftKings. “That’s more the focus than ‘Is this person customer ­type-A or type-B.’ ”

BetMGM claimed that it only limits what it calls “advantage players,” which amounts to about one percent of its bettors. FanDuel claimed that it’s even less than one percent of its players who are limited. But a simple search of DraftKings mentions on X reveals that if this cohort of gamblers is that small, they have a mighty voice. 

This year, a new nonprofit called American Bettors Voice formed to advocate for sports bettors. Founded by “Spanky” Kyrollos, along with former casino executive Richard Schuetz and legendary gambler Billy Walters, ABV has tried to educate the public and regulators about what bettors are experiencing.

But should anybody be sympathetic to the pro gambler? Isn’t it true what DraftKings CEO Robins says — that sports betting is simply entertainment? Just because we made it legal for people to earn a living accepting sports bets, does that also mean we should make it possible for people to earn a living placing them?

Andrews says focusing on professionals like him misses the point. He says the issue isn’t about how much people should be allowed to win, but whether it’s fair to deny anyone a chance to win at all, especially when winning is what’s being advertised. “If we were to have a panel of a hundred recreational bettors,” he says, “you would be surprised at the number that believes sports betting is not fair.”

“No state has said we’ve screwed up sports betting so badly we’re going to rescind it.” 

Shawn Fluharty, president of the National Council of Legislators From Gaming States

Andrews and I retire from our journey up and down the Atlantic City boardwalk to have dinner in a café while we watch the Red Sox-Rockies game and sweat out our Pivetta bet. Pivetta has six strikeouts, and I ­swallow hard, figuring this is going to be an expensive meal. ­Andrews is unfazed. “I don’t hate our chances,” he says. A couple of walks later, and there’s a meeting on the mound. Pivetta is pulled, one strikeout shy of going over. I’m elated. I look to Andrews for a fist bump. His head is buried in his iPad, studying the numbers on Unabated for the next game. 

I meet Alex Kane at Citizens Bank Park on a blistering Juneteenth for a Phillies-Padres matinee. The ballpark is packed, and the sun beats down on us. Kane and I are sweating, literally and figuratively, because we have a bet on the Phillies. “I never really was much of a sports bettor,” he tells me, “but really my love is the Phillies.”

This is notable, as Kane is the CEO and co-founder of Sporttrade, a startup sports-­betting company. Young, slender, and sharply dressed, with a wisp of red hair, Kane is at ease in the ballpark. He’s a sports fan, but a bit of a nerd about it. He’s less finance bro than tech bro, though he comes to sports betting with a finance degree from Drexel University. In college, a golf teammate introduced him to sports betting, and Kane became fascinated by how odds and prices were determined. “Trading has been around as long as betting,” he says. “I started to realize they were very close to the same thing.”

Kane noticed in sports betting, odds were set by bookmakers, much like how New York Stock Exchange prices were once set by specialists: “Now, anyone can offer a price, and exchanges bring buyers and sellers together.” He envisioned doing this for sports bettors — building an exchange to eliminate the bookmaker. By the time PASPA came down, Kane started building Sporttrade.

It was an uphill battle. Competing against FanDuel and DraftKings, each with years in daily-fantasy sports, and casino giants like MGM and Caesars spending millions on marketing, made customer acquisition tough. The licensing fees in New Jersey, among the first states to allow sports betting post-PASPA, were also steep, and the required partnerships with casinos or racetracks were costly.

After partnering with Bally’s for a license, Sporttrade began taking bets in 2022. Sporttrade’s growth has been modest. In June, a slow month for sports betting, FanDuel led New Jersey with $29,147,618 in revenue, while Sporttrade earned $134,880.

FanDuel and DraftKings control about 60 percent of the New Jersey sports-betting market. MGM and Caesars have struggled to keep up with them. It’s clear that DraftKings’ and FanDuel’s head starts on developing mobile technology through daily-fantasy sports and their strategy of an all-out assault on customer acquisition is paying off.

For years, it felt like you couldn’t go 10 minutes without seeing a sportsbook ad (though the American Gaming Association notes that in 2023 there were 31 pharmaceutical ads for every sportsbook ad). Today, sportsbooks are rethinking this, as there’s little market share left to capture. “In hindsight, we vastly overpaid for a lot of those opportunities,” says Eric Hession, president of Caesars Sports and Online Gaming, of marketing deals with sports teams, athletes, and celebrities, which have included J.B. Smoove, the Mannings, and Super Bowl ads.

In addition to burning cash on marketing, sportsbooks made outrageous deals with state legislators, like in 2021, when they agreed to a 51 percent tax rate in New York — 15 percent higher than the next-highest state tax rate at the time. FanDuel and DraftKings were eager to enter the lucrative New York market, but one year into the deal they went before the state legislature asking to lower the rate, calling it “an unstable foundation.” Meanwhile, New York has brought in more than $2 billion in sports-betting revenue in three years and is unlikely to renegotiate.

Some sportsbooks have surrendered. While there were 27 companies in New Jersey at legalization, today there are only 13. “My idea was that big companies would buy the small ones,” says legendary Las Vegas bookmaker Roxy Roxborough, who sold his own company to British bookmakers William Hill in 2012. But bigger sportsbooks like FanDuel and DraftKings already have customers. “It turns out small companies don’t have anything to offer unless they have better technology. And they don’t, so you can just let them go broke.” Among the casualties in New Jersey have been casino company Wynn, which left in August 2023, and the major international sportsbook Betway, which left the state’s market this year. Penn Entertainment, which operates the ESPN Bet sportsbook after inking a 10-year, $2 billion deal with ESPN last year, has projected a $510 million loss this year in its mobile sportsbook division. Sporttrade may be among the smallest operations, but it’s still standing.

The Padres hit a home run near us. A chant of “throw it back” breaks out, and the fan obliges, as is customary at Citizens Bank Park. “That’s so great,” Kane says, smiling as Phillies fans cheer when the ball plops back on the field. The Phillies, however, are losing, and our bet is in jeopardy. But Kane is nothing if not an optimist, and he’s taking that optimism for his company all the way to Pittsburgh.

As I head out of the Steelers locker room, I follow everyone down the tunnel in a full sprint, AC/DC blaring from the stadium loudspeakers, a cameraman right up in my face as I emerge onto the field. I turn to see myself on the jumbotron high above Acrisure Stadium. Next to my awkward mug is the image of a young bearded man smiling in a suit and tie. His name is Shawn Fluharty, and he’s in his 10th year as a member of West Virginia’s House of Delegates. He’s from Moundsville, West Virginia, the son of an electrician and a teacher’s aide for special-needs students, a self-described “trailer park kid.” “I do not have the political pedigree whatsoever,” he tells me. But today, in Acrisure Stadium, he’s the man. He’s the president of the National Council of Legislators From Gaming States.

Fluharty has brought NCLGS to Pittsburgh for its biannual meeting, and running through the tunnel with me are state senators and representatives from places like Georgia, Florida, and Washington. They’re here for more serious business than pretending to be Steelers. It’s at these meetings that NCLGS members work together to write the laws that regulate gambling. When they see Fluharty standing in the section of the end zone above us, they wave and call him “Mr. President.”

Fluharty paid attention to the effort to overturn PASPA early, and felt bullish about its chances of winning. He helped write and pass a sports-betting law in West Virginia that would trigger the second the Supreme Court decision came down, “and we were one of the first states out the gate.” 

Many state legislatures adopted sports betting with the hope it would generate new tax revenue. But sports betting is a low-margin business. The revenues in some states haven’t been as high as legislators were led to believe they’d be, and nowhere has seen the kind of money New York has brought in. In its first year of legal sports betting, Colorado collected only $6.6 million, leading legislators there to reconsider the way they tax sportsbooks. 

A few blocks away from the stadium I find a large group of conference attendees schmoozing at a local bar. There are more than just state legislators at NCLGS in Pittsburgh. In addition to operators like Sporttrade’s Kane, there are executives from ­FanDuel, who have sponsored a meet and greet with Steelers great Jerome Bettis later in the week. There are also gamblers here. It seems everyone wants an audience with the politicians.

At the bar, I run into Spanky, gregarious and baby-faced in a bright-blue-checked blazer. In one hand, he clutches a lighter he uses to light everyone’s cigars. In the other fist, he clutches a wad of hundred-dollar bills. He’s trying to pay for everybody’s drinks, and a representative of a gambling-industry consultancy is trying to beat him to it. Spanky, a true gambler, believes the biggest bankroll always picks up the check, but the consultant whips out his corporate credit card and Spanky backs off. “I’m not gonna do battle with a corporate card, bro,” Spanky says, and he turns to the bartender and orders a drink.

Spanky was invited to NCLGS by Fluharty to participate in a panel called “Making a Living Off the Odds,” which was easily the most-attended panel of the week. Everyone was there to see Billy Walters. Walters is as close to a celebrity as you’ll find in this world. He’s been featured on 60 Minutes and has been the subject of articles and a book during his nearly 70 years of betting on sports. After spending three years in federal prison for insider trading, Walters was pardoned by President Trump in 2021 and last year published a bestselling memoir, Gambler: Secrets From a Life at Risk. Walters is retired today, but he’s still unhappy with how he sees things unfolding with regulated bookmaking.

“I’m here all on my own. I’m no one’s hired gun,” Walters says to begin the panel. He goes on a tirade for several minutes about everything from the way gamblers are taxed, the way winning players are limited by sportsbooks, and the ineptitude of modern American bookmakers. “With all due respect, the majority of the people that are licensed that do this today don’t have a lot of expertise when it comes to booking sports.”

He’s got a point. Sports betting has been legal in Nevada since 1949, and Americans have bet with illegal bookmakers since at least the late-19th century. Over that time, plenty of people have learned this business inside and out. Today, however, the major sportsbooks are publicly traded and run by people with business and tech backgrounds.

“I was accessing adrenaline regularly, fighting, then went from that to nothing. There was one place where I felt something similar — at a casino.”

Elizabeth Thielen, former boxer and gambling addict

Chris Jones, head of communications at FanDuel, argues that sportsbooks today are a whole different animal than how Vegas used to be. “Operators with scale are processing 50,000 bets per minute during major events like the Super Bowl — volume that retail bookmakers in Las Vegas or Atlantic City did not see,” he tells me. If you look at the FanDuel or DraftKings betting menus, you’ll find thousands of options, from propositions on individual player performances to outcomes on every drive or possession or at-bat, not to mention the ability to place bets live during a game. Most Las Vegas sportsbooks don’t offer as many bets, because it’s simply too much to manage. At a certain scale, bookmaking becomes a technology issue rather than one of human expertise. In time, FanDuel’s trading and risk-management ­operation should also benefit from its acquisition by Flutter Entertainment, a global sports-betting company. “It’s important to understand that this is only year six of legalized sports betting,” Jones says. 

Those tasked with regulating and writing legislation are neophytes, too. Some, like Fluharty, turn to experts like Walters for guidance. “I’m big on letting the experts tell me,” Fluharty says. From the Massachusetts Gaming Commission investigating player limits to Oregon Rep. Andrea Salinas and Connecticut Sen. Richard Blumenthal’s Gambling Addiction, Recovery, Investment, and Treatment (GRIT) Act, aimed at addressing sportsbooks targeting problem gamblers, more officials are learning how to fix the industry. They have no choice. As Fluharty puts it, the toothpaste is already out of the tube. “Not a single state has said we’ve screwed up sports betting so badly we’re going to rescind it,” he says. “That’s not going to happen with anything still making money.”

Elizabeth Thielen has always been a fighter. In her early twenties, when she was only five feet two and 112 pounds, she wandered into the storied Lower East Side Boxing Club in Erie, Pennsylvania, and became the gym’s first-ever female prospect. Three months into training, she won her first fight by breaking her opponent’s nose. She went on to win back-to-back Pennsylvania Golden Gloves titles. When the women’s national amateur championships came around, the workers from Erie’s GE plant threw a party to raise the money to send her. She came back home with the national championship. She was profiled in a book and in The Washington Post. She was going to be the next big thing in women’s boxing. Then she injured her wrist and arm. “I was accessing adrenaline regularly, fighting, then went from that to nothing,” Thielen says. “And there was one place in my life where I felt something similar — at a casino.”

Thielen found that gambling fueled her need for the rush she got from boxing, so much so that she would sneak away and spend six or seven hours at a time at the casino. “I would have to bet in very risky ways in order to get the adrenaline, increasing my bets, playing blind,” she says, referring to gambling without looking at her cards. “That was extremely costly.” She’d lose money, then chase those losses by betting more. Ironically, this was exactly how she was trained as an athlete: Never give up. Keep fighting. But at the casino, it was devastating. It’s called the gambler’s fallacy — the belief that if you keep trying, things will eventually break your way. Unlike in sports, there was nothing an athlete like Thielen could do to change the odds in her favor. Things never broke her way. She lost more money than she can remember. “It’s safe to say it was in the six figures.” She had sold so much gold to the pawn shop they had come to depend on her. Once, when she didn’t show up, a shop sent someone to her house to see if she was OK, and to ask if she had any more gold she wanted to pawn. 

Today, Thielen is a certified gambling counselor with EPIC Global Solutions, and she works with college students, leagues, sportsbooks, and casinos. A growing number of states now require sportsbooks to fund responsible-gambling initiatives. Counselors like Thielen are needed because young people and problem gamblers are especially vulnerable. Her background as an athlete is particularly relevant, as recent scandals involving athletes and betting have made states (and the public) nervous about gambling’s impact on the integrity of sports.

Jontay Porter of the Toronto Raptors was caught betting against himself and shaving points. Alabama coach Brad Bohannon gave inside information about his pitcher to a gambler for betting purposes. Stories like these have sparked public outcry over gambling’s potential to corrupt athletes and coaches, and new ones seem to pop up every week.

The industry argues such scandals prove the system is working. “We don’t know what we don’t know,” says Tres York, senior director of government relations for the American Gaming Association. “Sports-betting scandals aren’t new. Now, they’re being brought into the light. We have a legal, regulated industry to do that, and the technology to identify it.”

While it may be in the industry’s interest to frame the issue this way, that viewpoint isn’t wrong. It’s almost certain that athletes have shaved points, taken dives, or bet on themselves for as long as there have been sports. And it’s true we’re better equipped to catch them now.

Professional gamblers, often blamed for athlete corruption, also play a role. They can spot irregularities before regulators or sportsbooks because they monitor the markets constantly. Sometimes, an irregularity in the betting market points to a valuable bet, like an oddsmaker’s mistake, but sometimes it’s a sign of something insidious.

Earlier this year, Temple University basketball players were suspected of shaving points. Gamblers tipped off sportsbooks. Elihu Feustel was asked by a sportsbook to look at three Temple games where the first halves seemed off. “If Temple is an eight-point favorite but there are one and a half in the first half, when they should be four or four and a half,” he says, “that’s a giant aberration that’s so large there’s no way to explain it other than match fixing.” (No action has been taken against any players, and the Temple investigation is ongoing.)

While it’s unclear if corruption in sports post-PASPA is rising or being rooted out, what we do know is that problem gambling is increasing. The National Council on Problem Gambling (NCPG) says gambling addiction could be up as much as 30 percent since sports betting was regulated. Nationwide, calls to gambling hotlines are up since 2018, and in some states they have more than doubled. According to Keith Whyte, NCPG’s executive director, in the past year there has been one call to 1-800-GAMBLER every minute of every day.

According to NCPG, 16 percent of sports bettors meet the criteria for clinical gambling disorder. Men between the ages of 18 and 24 are particularly at risk, creating what Whyte calls a “ticking time bomb” of young people growing up not knowing what it’s like to not have a sportsbook in their pocket at all times. 

But a 2023 Ipsos poll found that among Americans who have bet on sports, roughly 73 percent say they place a bet once a month or less. This tracks with what sportsbooks tell us about their players — the majority gamble recreationally and responsibly, and therefore aren’t very profitable for the sportsbooks. That, too, is a problem that exacerbates the issue of responsible gambling. 

On the morning I see Thielen speak on a panel at a gaming-industry conference in New Jersey, Behnam Dayanim from the law firm Orrick, Herrington & Sutcliffe, which counts FanDuel, DraftKings, and BetMGM as clients, speaks on a different panel about ways companies can address problem gambling. When asked about instituting deposit limits as a guardrail to keep people from losing too much, he said, “I don’t think it’s a secret that larger wagerers are our most profitable customers.” To illustrate, he references a rumor that a single DraftKings VIP player jumped ship for Fanatics, and the player lost nearly $13 million in a month.

The industry would like to believe that the VIPs responsible for its profits are wealthy enough to afford it. But sportsbooks have proven they know how to profile their players, and some of these “large wagerers” might be players that sportsbooks know are more likely to lose — and lose big. 

“A VIP host can be compensated based on handle,” says Brianne Doura-Schawohl, a policy consultant on responsible-gambling issues and the former legislative director of the National Council on Problem Gambling. “Handle” refers to the total amount of money wagered. “If you’re an individual who’s wagering a lot and losing a lot, there’s a reward for the host to continue that type of behavior with a player. It can be very dangerous.” 

In a statement provided to Rolling Stone, DraftKings says: “DraftKings’ Dynasty Rewards program offers perks to loyal players, following a model similar to other companies that reward customer loyalty. Our business is rooted in fun and entertainment, and we are deeply committed to ensuring that all players, regardless of their gaming budget, engage responsibly.”

When Thielen was in the thick of her gambling addiction, she, too, was strung along by perks and benefits bestowed upon “large wagerers.” When she entered the casino, everything was on the house. She’d treat her friends and family to lavish meals, all paid for by the casino. It never occurred to her that these meals weren’t actually free, but paid for by her gambling losses, until one night during a dinner when her husband finally asked her, “Liz, just how much do you gamble?” 

“And in that moment, my gambling life flashed before my eyes,” Thielen tells me. “All the late nights. All the lying. All the significant financial problems I had.” She had so tightly packed it all away, just like she once did with concussions or other injuries, hiding them in order to get back in the ring. Now she was face to face with how badly things had deteriorated. She resolved to get help. It took her nearly 11 years to make back everything she had lost and get back on her feet. 

But even after luring VIPs with gifts, parties, and deposit bonuses when they go broke, American sportsbooks still aren’t making enough money. Many of the companies now believe their future lies in slot machines, not sports betting. In states without mobile gaming, sportsbooks are lobbying for legislation allowing them to expand from sports to mobile slots — a game with higher margins and zero risk.

Sportsbooks tell lawmakers that mobile casinos will deliver the tax revenues sports betting didn’t. Currently, only seven states have regulated mobile casinos. At the NCLGS meeting, Cesar Fernandez, head of state government relations at FanDuel, gave a presentation on what the taxes his company paid had funded — road construction, teacher salaries, and state troopers. But it was actually a pitch. “What would happen if these states actually passed iGaming?” he asked, referring to an industry term for mobile casino apps. “It gives you a sense of what the actual impact could be if we looked at authorizing online gaming as a means to this end, as a means to teacher salaries, as a means to making sure that our law-enforcement officers and first responders are never subject to budget cuts.”

There was scant discussion, however, of preventing problem gambling. According to a Businessweek survey, less than two percent of sports-betting revenue goes to problem-­gambling initiatives. Adding more addictive games will only worsen the problem. “America can survive sports betting. It survived illegal betting for years,” Roxborough says. “Whether it can survive a casino on everyone’s phone — that I can’t answer. That might be the tipping point.”

Sportsbooks are in a tough spot. They want more money, but their customers, lawmakers, and the public are frustrated with how little good they’ve done compared to the harm. In defense, sportsbooks fall back on the same argument they’ve used since PASPA: If these companies can’t grow, all their customers will turn to the black market.

The “black market” is a nebulous term, however, and is often applied to any sports betting that isn’t regulated by the U.S. government, which is to say nearly all of the sports betting that has happened in this country for the past century. In that respect, the black market is where this business was created, its finer points sharpened and refined. It continues to this day, largely offshore, and it’s where the smartest bookmakers and bettors do business with one another, setting odds that the rest of the world relies on for nearly every sport. Regulated American sportsbooks want to deprive it of American customers. I wanted to see the impact for myself, so I flew down to Central America. 

The casino at the Amapola Resort in Jaco Beach, Costa Rica, is slow tonight. A woman feeds colones into a slot machine. A group of men shoots pool. Behind a two-way mirror, in a windowless room just off the casino floor, there’s plenty of action going on. This is the nerve center of BetAmapola, a licensed Costa Rican sportsbook and one of the newest in the country. Buried in an array of computer screens is J.R., who has a Raiders cap tight over his brow, and an intense stare as he studies the numbers on his screen.

J.R. was once a prominent bookie in the U.S. He grew a college side hustle into a multi­million-dollar operation in the 1990s, then decamped for Costa Rica, following a number of other high-profile bookmakers looking to avoid the long arm of the U.S. Justice Department. Over the past three decades, J.R. has gone from boom to bust and back again. He and his fellow expats have been part of every iteration of the sports-betting industry in the past 30 years. And now, as sports betting is booming back home like never before in his lifetime, he’s trying to ride the wave. He’s taken the reins of this formerly distressed resort in the surfing hot spot of Jaco and rebranded it into a destination for young American sports gamblers to visit. “This is where I decided to plant my flag,” he tells me.

Tonight is the season opener for the NFL, and the Costa Rica national soccer team is playing in a tournament game in San José, so despite the slow night in the casino, it’s a busy one for the sportsbook. Working alongside J.R. is Sean Conway, a laid-back, scruffy, late-twenties American finance grad who came to Costa Rica just days after graduation, hoping to learn the ropes as a bookmaker.

In the Amapola office, J.R. and Conway take bets, move lines, make calls to other bookmakers, furiously clicking and shouting numbers and team names as kickoff nears. Here in this windowless backroom of a tiny Central American casino is one outpost of the global market, where they handle a small share of the billions of dollars that are wagered with international sportsbooks. While there are fewer than 60 licensed sportsbooks in the U.S., there are about 300 online gambling companies in Costa Rica, including Costa Rica International Sports, or CRIS, which is one of the largest sportsbooks on Earth. “There’s more bets written in San José, Costa Rica, than any other place in the world,” says J.R. 

Here in Costa Rica there are an array of different types of sportsbooks and business models, and they come in every shade, from black to gray to white. Books like Bet­Amapola and CRIS are licensed, follow Costa Rica’s laws, and won’t do business with gamblers in the U.S. Other sportsbooks accept American customers who use cryptocurrency or mask their location with virtual private networks. Still others operate in a gray area as “pay per head” businesses, offering their software for a fee to American street bookies but not handling any money from gambling, while bookies use the software to process bets and settle up with customers in cash, potentially violating gambling laws where they live.

J.R. asks who I like in the game. I say I like the Ravens +2.5 and ask if I can bet it with him. He agrees, on one condition: I have to parlay it with the Costa Rican national team. I agree, and we put the games on the two big screens in the office. He tells me the sportsbook is heavy with bets on the Chiefs, so he and I are both rooting for the same side.

The Ravens stage a late comeback, and appear to have clinched the cover, if not the victory, when Isaiah Likely catches a touchdown pass with the clock winding down at the end of the game. The three of us cheer so loudly in the office the casino patrons turn toward the two-way mirror that hides us. But on further review, Likely’s toe was on the line, and the touchdown doesn’t count. (Costa Rica’s national team did its part and won in a rout.) I hand over the $200 I owe J.R. for my bet, a pittance compared to the haircut he took on the game. He’s unfazed. “Let’s go eat,” he says with a smile.

The real pioneer of the Costa Rican offshore gambling industry is Ron “the Cigar” Sacco, who is considered one of the biggest illegal bookmakers in American history. After a number of arrests, Sacco eventually relocated to Costa Rica, where there were no laws against sports betting, and took bets over the web instead of the phones. He did an interview with 60 Minutes in 1992 that many cite as the inspiration that fueled a massive bookie diaspora. It may have also inspired the feds to pursue him. That same year, Congress passed PASPA, and two years later, they had Sacco in cuffs. He pleaded guilty to the federal crimes of “conducting an illegal gambling business” and “making financial transactions with the profits of crime.” All told, Sacco’s rap sheet included more than a dozen convictions and over five years in prison. At the time he went away, they said he was doing $100 million in business a month. When he got out, he headed to Central America, where his empire was anxiously waiting for his return.

Among those waiting for him was J.R., who arrived in Costa Rica while Sacco was in prison and was in awe of Sacco’s operation. 

By 2004, Costa Rica was home to hundreds of sportsbooks that were believed to be booking tens of billions of dollars in bets a year, much of it from Americans. In 2006, Congress tried once again to shut down the offshore gambling industry, passing the Unlawful Internet Gambling Enforcement Act (UIGEA) by tucking it into the SAFE Port Act at the last minute. The law allowed the Justice Department to attack offshore gambling by stopping domestic banks and other payment processors from moving money to and from gambling companies. It had a considerable impact and forced a lot of offshore bookies to reconsider their businesses. Sacco sold CRIS to a Costa Rican businessman named J.D. Duarte, who stopped doing business with Americans and focused instead on Latin America. Other offshore sportsbooks did the same, blocking their websites from access by Americans and choosing instead to do business in Europe or Asia. Some converted into pay-per-head shops, licensing their technology to local bookies in the U.S. for a per-user fee. Some moved back to America and returned to their roots, becoming bookies themselves. Some, like J.R., went broke.

For the next decade, J.R. tried to build his business back up from nothing. A gambler he owed money to sent someone to Costa Rica to collect. J.R. gave him his car. “It was a slow death,” he says.

He ended up hearing about an aging resort hotel in need of some upkeep. It had a casino license, but the casino had been closed for a long time. J.R.’s wheels started spinning. “I can promote a sportsbook behind this license,” he thought.

J.R. persuaded the owner of the Amapola to let him take it over. He spent months putting sweat equity into the place, getting the restaurant going, getting the rooms renovated, and most important, getting the paperwork straight to get the casino back up and in action. BetAmapola is an international sportsbook that advertises itself as being friendly to professional gamblers and willing to take large bets. “Big bets in mature ­markets, pay quick, no bonus. That’s my model,” he says. “And whoever wants to bet on that model is more than welcome. Win whatever they want, they’re gonna get paid on demand.”

At a ritzy San José steakhouse called Doris Metropolitan, J.R. and I meet for lunch with Bill (pseudonym), another expat American bookie who relocated here in the Nineties. They make an unusual pair. Both are firmly in middle age, having married Costa Rican women and raised children and sent them off to college here. But while J.R. dresses in sports jerseys and ball caps and carries himself with a youthful urban swagger that betrays his age, Bill is more buttoned-up. 

Bill and J.R. are members of a fraternity of bookies who not only came to Costa Rica behind Sacco, but have also figured out a way to survive the business through its nadir. They tell me that while the UIGEA was a major blow, the repeal of PASPA was, at first anyway, even worse. “The legals have definitely affected us, 100 percent,” Bill says, referring to the regulated U.S. sportsbooks.

Bill operates a pay-per-head sportsbook, and his bread and butter has always been what they call “agents,” which is really just another word for bookies. The agents drum up new business, sometimes receiving a cut of losses as their payment. Traditionally, agents have been mostly small-timers, managing customers in their fraternity houses, at their job sites, or down at the local bars. But a lot of small guys added up to big business for offshore operators like Bill. 

After PASPA, most of those small-time guys lost their players to the apps, because the major sportsbook companies offered sign-up bonuses and promotional offers that were too good to turn down. The local bookie just couldn’t compete with a $1,000 risk-free bet. 

“Where it’s dipping is the small retail player,” says J.R. “The guys that bet the parlays and whatnot are not returning to agents anymore.” But he believes the tide will turn and American players will come back: “The legals don’t stand a chance. They’re giving away money hand over fist.”

Between an increasingly knowledgeable bettor pool, and marketing deals like deposit bonuses and free bets, which regulated sportsbooks write off their taxes as marketing expenses, Bill thinks the legals will soon be in over their heads. “In one or two years, they’re going to be like, ‘Jesus Christ, what do we have here? We have a house of shit.’ ”

“The legals don’t care about profits. They only care about market share,” J.R. says. The regulated U.S. sportsbooks, to hear J.R. and Bill describe it, cost themselves money and good customers by being afraid to do the thing they ostensibly are supposed to do: gamble.

As regulated American bookmakers continue to limit players, they also cast more new gamblers out into the wilderness in search of sportsbooks where they won’t get limited. “Back in the day, when Bill and I first met each other, they had guys out there running around trying to get players,” J.R. says. “Now, there’s more people that are trying to get outs.”

By “outs,” J.R. means places to bet. And that pool of players looking for outs has only grown in the U.S. in the past six years. “Back in the ’80s, ’90s, 2000s, it was considered taboo,” Bill says. “Everybody’s like, ‘Oh, you’re betting with a local bookie? Is it a mob guy?’ The stigma now has been removed. It’s an OK thing to do. There’s corporations behind it.”

The proliferation of sports betting has meant that shops like Bill’s are able to recruit new players from everywhere, not just states that don’t yet have sports betting, like Texas and California. “You name a state, we have customers,” Bill says. And while the Fan­Duels of the world might be peeling away the smaller bettors who would’ve bet $50 a game with guys like these, the big players in the regulated market are still worried about the offshore market. Chris Jones says FanDuel considers them a “major concern” because they don’t pay any taxes and don’t do age verification or responsible-gambling monitoring. 

But FanDuel also might be concerned about the estimated $15 billion to $20 billion a year bet offshore. Just like the regulated sportsbooks, global destinations like Amapola, black marketers, and pay-per-head agents are all trying to lure in the whales, who, they believe, they can more easily win over from the regulated sportsbooks by offering those players easy credit. While regulated sportsbooks require players to put up the money to bet, black-market bookies will give them a credit line and only settle up once a week. “The bigger guy doesn’t want to sit there and continue to do wires, moving money back and forth,” Bill says.

It’s ironic, given that the bigger bettors are the ones the regulated sportsbooks rely on to turn a profit. But they’re going to try to hang on to the ones who lose, and toss the winners back to Bill.

J.R. suggests to Bill that they can find some of these bigger bettors at BetBash in Las Vegas, a gathering of sharp sports bettors started by Spanky at a bar in New Jersey three years ago. Today, BetBash is held at the Circa Resort and Casino in Las Vegas, and tickets run from $649 to $1,499. Bill is unconvinced. I ask J.R. whether attending BetBash is akin to fraternizing with the enemy, since there will be several hundred sports bettors all looking for a way to beat their bookies.

“That’s why it’s good for us to be out there,” he says. “Just to know what’s going through their head.”

Spanky, Fats, Chinese Mike, Stevie the Pencil — they’re all here. They’ve come from around the world to downtown Las Vegas for BetBash. Some to network, some to learn, and many to party. Tonight, the partying begins at the first of several open bars at Circa Resort and Casino this week.

Derek Stevens is here, too. He’s hard to miss — tall with the frame of a pro athlete and a cornflower-blue suit matching the hotel. I assume that’s intentional — he owns the joint.

The 57-year-old Michigan native always loved Vegas. He and his brother moved their investments to Nevada in the early 2000s to avoid state income tax. Soon, he was buying small downtown casinos. Eventually, Stevens aimed to develop a large-scale, high-class resort in downtown Las Vegas. It was a bold move — nobody had built anything new downtown in more than 40 years. But Stevens liked the area, and the prices were good. He opened Circa in 2020, and it’s been a hit since.

Circa is unique among Vegas casinos. Its main feature is its sportsbook — the largest in the world. It resembles an NBA arena, with two stories of stadium seats and a massive wall of screens showing every sport imaginable. While sportsbooks are a staple in most Nevada casinos today, nobody has one as big as Circa’s. That’s because in the casino business, sportsbooks have never been very profitable. 

“Caesars had a sportsbook for one reason,” says professional gambler Walters, “to service their casino customers. They really didn’t even care about being in the sports business. It was there as an amenity to their hotel customers.”

Roxborough says, “If you didn’t have a sportsbook, your customers would walk across the street to a place that did.”

In the Seventies and Eighties, Roxborough partnered with bookmaker Vic Salerno in Leroy’s, one of the first sportsbook chains in Nevada. In the early Seventies, sportsbooks were taxed at 10 percent of the total amount of bets they took, but only expected to profit about four percent. The only way to make a profit was to win more bets than they lost — they needed to actually gamble against their customers. Casinos had guaranteed profits from slots and games. They wanted nothing to do with sports.

Eventually, the state lowered the taxes, and casinos reluctantly waded in. By the Eighties, Nevada sportsbooks became popular, if not always profitable, and that popularity has steadily grown. “The industry said, ‘We’ve gotta get out of the dark ages into the modern world with these sportsbooks,’ ” says Roxborough. “And that line goes straight to Circa.”

Stevens’ bookmakers run it old-school, taking bets from all players. They’re not afraid of a little risk. “We book a losing day pretty often,” he says. “We’re not trying to shun away professional or big-bet players. We want to work with players.” It helps that Circa’s sportsbook is backed by its casino, and ideally some of those winning players will donate some winnings back in the dice pits.

If Circa has a customer, BetBash attendees are likely their ultimate form. There’s speed networking, seminars, workshops, and even a golf tournament. The most impressive addition to BetBash came last year, when Spanky and Stevens unveiled the Sports Gambling Hall of Fame. This year’s inductees include Sacco, and a whole lot of folks from the offshore industry, including J.R., plus some who rarely come to the U.S. for fear of prosecution, showed up at BetBash to honor him.

J.R. isn’t only in town to attend BetBash. He’s also looking to attend the Blackjack Ball, an invitation-only dinner held every year in Las Vegas for the most successful gamblers in the world. The event is so secretive, cellphones and photos are not allowed, and nearly everyone in attendance uses a pseudonym, for fear of being discovered by casinos that work hard to ban them from playing. 

Andrews has long attended the Blackjack Ball, having started his career as a card counter. But in recent years, more sports bettors have been invited to attend, and more of the regular attendees in turn have been betting on sports. “This is something I resisted for years, because I always said I’m not really interested in sports,” says professional gambler Richard Munchkin, who recently came out of retirement from gambling to start betting on sports. “This is the gold rush, and there’s a lot of money to be made.”

I sit at Roxborough’s table, which is almost entirely sports bettors. Captain Jack is here, as are Rufus Peabody, Spanky, and some others who are so low-key their mere existence is sometimes debated. There are multiple attendees who’ve won over a billion dollars gambling. 

The original Blackjack Ball was held in 1997, and some of the attendees have been to every one of them. Ed Thorp, the 92-year-old inventor of card counting, is here, and there are a lot of older gamblers whose playing days are well behind them. 

There are also a lot of younger people, including those in the 18-to-24 demographic Keith Whyte worries about. (Whyte is here, too, believe it or not. He’s receiving a check for nearly $40,000, the proceeds from the event, which are donated each year to help fight problem gambling.) But he need not worry about these young men. I meet people who earn their living playing poker, slot machines, even someone who figured out how to beat the lottery and has made millions of dollars. If anyone in this room is addicted to gambling, it’s only because gambling is making them filthy rich. 

The marquee event at every year’s ball is a team-gambling skills competition, which is mainly focused on casino games like blackjack, not sports betting. We’re grouped into teams, such as the “Hall of Fame Nominees” team, the “Top Women Pros,” and the “Field” (everyone not on a team, which by default includes me), and attendees can bet on the winner. The odds on each team change as money is bet into the pool, and when I go to the makeshift window to make my bet, I notice that the “Sports Sharps” team, which includes Spanky, Peabody, and Roxborough, went from being one of the longest shots on the board to among the favorites. The oddsmakers may have figured the “Sports Sharps” weren’t very familiar with blackjack, but evidently some of the sharps are willing to bet big on themselves. 

This ballroom holds the most successful gamblers in the world, and a lot of them started in blackjack. Many would say that game is now dead. Casinos today are too good at stopping card counters. The ones who did it for a living have moved on. They have to keep learning new games, finding new edges, because while it may not be true that the house always wins, the house always figures out how to stop those who do. 

The sports bettors at the ball, veterans and newcomers alike, would be wise to heed this lesson. In the gambling world, no edge lasts forever. Right now, the sports bettors are having their moment. But the industry is at a crossroads, and the future is uncertain. Hopefully, somewhere in those screens of flashing numbers, they can deduce and project what happens next.

Businesspeople love to think of themselves as risk takers. They tell a story about themselves, and about America, that says everyone on top got to where they were by taking a big risk — a gamble — and success is the reward for their courage and foresight. But really, a lot of the people on top are no different from the folks at the Blackjack Ball — hustlers who found a sure thing. 

The repeal of PASPA made it possible for people in America to make money taking bets, but they turned around and made it nearly impossible for anyone to make money placing bets. If anything, they made it easier than ever to lose. 

There’s some kind of profound irony in the fact that the gambling companies want to get rich off gambling, but don’t want to take any risks themselves. The government, the shareholders, the CEOs, they all want their money guaranteed. The rest of us, the real risk takers, we’re just looking for a fair bet at a good price. 

As I stare at the tote board, I ask Rufus Peabody for advice. He may be a pro, but on this he has no pick. He only tells me not to bet on the sports bettors, because they don’t stand a chance. I hand the teller a hundred bucks, and ask him to bet it on the Field.