Online Sports Betting Popularity is Increasing
Even though Sunday’s Super Bowl included a few remarkable “firsts,” including two siblings playing for rival teams, it will unquestionably be recognized as a significant turning point in American sports betting.
This past Super Bowl saw over 100 million legal Super Bowl LVII wagering transactions, according to location analytics company GeoComply. This is a brand-new all-time high and a significant 25% rise over the Super Bowl the previous year.
The statistic comes after the American Gaming Association (AGA) predicted last week that more than 50 million American adults would legally wager on the Eagles-Chiefs game, which would be a record-breaking 61% rise from the previous year and the largest ever. It was estimated that betters had wagered up to $16 billion in all.
Why is this occurring, then? The expansion of online bookmakers like DraftKings, FanDuel, and others is undoubtedly a factor. After a 1992 federal statute banning sports gambling was invalidated by the Supreme Court five years ago, sports betting is now permitted in more than 30 states and Washington, D.C., with several more considering legalizing it in state legislatures.
Is it permitted to bet on sports in your state?
Investors are dissatisfied with the stock market’s performance over the past 12 months, and they are cynical about rising interest rates and inflation that won’t go away.
Even wagering on the online sportsbooks themselves has often been unsuccessful. The Roundhill Sports Betting & iGaming ETF, which was introduced in June 2020, surged during the pandemic months when households that were locked in were saving money on eating out and going to live events, but it has since declined as personal savings rates have dropped back to levels seen before the pandemic.
An extensive majority of Americans now anticipate that consumer prices will continue to rise this year, and almost 50% believe that equities will decline in the first half of 2023, according to a recent Gallup poll. Since the company started asking the question more than 20 years ago, it represents a record-high proportion of respondents who are negative about the stock market.
Considering all of this, some people might think that winning big on a sports wager is the only way to increase their money right now. Even though a considerably higher percentage of Americans—approximately 58%—own stocks than place Super Bowl wagers, people’s perceptions of traditional investment have understandably been damaged by market volatility and economic instability.
The Super Bowl did not feature any cryptocurrency advertisements
The cryptocurrency sector had similar crises and upheavals in 2022 and, according to the Bloomberg Galaxy Crypto Index, finished the year down 70%. Due to the numerous commercials for cryptocurrency-related businesses including Coinbase, Crypto.com, eToro, and FTX, the Super Bowl last year earned the moniker “Crypto Bowl.”
No crypto company sponsored advertisements during this weekend’s Super Bowl, which was a startling about-face. What a change a year can make.
Instead, the public saw advertisements for manufacturers of food and beverages, vehicles, film studios, and streaming services.
By the way, the price of a 30-second advertisement during this year’s Super Bowl was somewhere between $6.5 million and $7 million, setting a new record. Prices for advertisements have soared by more than 16,000% since the first Super Bowl in 1967.
Tighter Lending Standards Are Yet Another Sign That A Recession Is Coming
Despite the robust labor situation in the United States, recession risks are in fact increasing. Every recession has been preceded by three factors, according to a recent research report from investment banking firm Piper Sandler: 1) a surge in interest rates, 2) a rise in inflation, and 3) stricter lending requirements.
Although rates and inflation have received all the attention, tighter bank lending might be just as significant. Look down below. Since the third quarter of 2021, more banks in the U.S. have reported tougher lending rules; according to the most recent reading, 45% of banks indicate they are decreasing the rate of business loans.
As you can see, stiffer lending standards tend to precede economic downturns; Piper Sandler maintains its prediction of a recession occurring in the second half of 2023.
Therefore, I believe it’s crucial to exercise prudence. It should go without saying that gambling and sports betting are not the same as investing and should not be substituted for it. You have no prospect of ever recovering your initial investment if you lose money betting on a game in a matter of seconds.
On the other side, even if you choose not to sell your stocks at a loss, the value of your investments may decrease, but at least there is a chance of breaking even.
