Here’s Why Sports Betting is As Big As Legal Marijuana

Marijuana was legalized in Canada in 2018 which led to investors from around the world investing billions of dollars into the industry. This resulted in valuations reaching record highs and enticing hundreds of entrepreneurs to launch new ventures.

With all the excitement in marijuana legalization, investors have missed out on another massive industry that was legalized in the previous year. Marijuana legalization has swept sports betting legalization under the rug.

Both the marijuana industry as well as the sports betting industry face a similar problem. They both have to find the tax rate sweet spot so that they can maximize revenues while making sure that they don’t exceed what the market will be able to bear.

Richard Auxier, a research associate at the Urban-Brookings Tax Policy Center, has said that states must keep both of these industries betting tax rates moderately low because the states are in competition with illegal markets.

The states want people to participate in these activities. They aren’t like cigarette taxes which are implemented to dissuade people from smoking. The states must make sure that these activities are taxed in a way so as to boost revenues instead of hurting them.

How big is the sports betting market?

The global sports betting market was valued at $104.31 billion in 2017. The market is expected to reach $155.49 by 2024. It is growing at a healthy CAGR of 8.83% between 2018 to 2024. As you can see, this isn’t a paltry sum of money that can be ignored. The sports betting market currently holds close to 70% of the global gambling revenue. Interestingly, this is more than other sectors such as lotteries, casinos, poker as well as other forms of gambling.

The only thing that can slow down the rate of the sports betting market’s growth is strict regulations laid down by different governments of different countries around the world. The global market includes Asia Pacific, North America, Latin America, Europe, and the Middle East and Africa. The Asia Pacific sports betting market is the market that is predicted to see a significant rate of growth in the following years. This growth can be attached to different economic conditions throughout the entire region which will increase the disposable income of the population for various leisure activities which include sports betting.

One thing is for sure, and that’s what sports betting will be as big as legal marijuana in the near future.