No Penalty On The Play: DraftKings, FanDuel Avoid Wait For Illinois Licensure

The IllinoisLegislature made a decision to punish businesses like DraftKings and FanDuel when it drafted its most recent gambling expansion law. But, the attempt to restrict online sports betting users has failed to achieve that goal.

DraftKings and FanDuel are both licensed to operate online betting in the Prairie State, Illinois. With two more regional players entering the market, one begins to question why there was a delay in issuing online-only licenses.

FanDuel and DraftKings are authorized for online sports betting in Illinois.

The Illinois Gaming Board (IGB) granted management services provider permits to both companies on Friday. This essentially authorizes both companies to operate sportsbooks for Illinois master license holders.

It’s uncertain when the two will start interacting, whether online or in person. Nevertheless, it might be essential for both users to be online simultaneously.

At present, the suspension of the requirement for in-person registration for online betting by Gov. JB Pritzker is still active. This implies that the earlier the sportsbooks begin operations in the Land of Lincoln, the more time they will have to gather online account registrations.

Though residents of Illinois may have the ability to rapidly update desktop and mobile websites, the process may be more challenging for Android and Apple applications. Changing state regulations for these applications may require the creation of custom-designed apps for each business.

The escalating competition adds extra pressure on DraftKings and FanDuel in the market. PointsBet was granted a permit by the IGB last Tuesday, and the company plans to expand into IL very soon.

“The story’s most interesting aspect, however, is the avoidance of the ‘penalty box.’ Understanding this situation requires a quick history lesson.”

Why did the Illinois Legislature support DraftKings and FanDuel?

In 2015, the IL Attorney General at the time, Lisa Madigan, declared that daily fantasy sports contests were considered illegal gambling. Despite this, DraftKings and FanDuel remained unfazed.

Instead, they called Madigan & rsquo’s bluff. They continually accepted paid comments in IL, essentially gambling on the fact that Madigan wouldn’t press any charges.

Despite their actions being correct, DraftKings and FanDuel faced significant consequences. These repercussions notably affected the evolution of betting legislation in 2019.

Essentially, politicians desired that online casinos in Illinois delay independent operations for nearly two years. They implemented this in a unique way.

Online-only sports gambling certificates, limited to three separate ones, are legally allowed. The holders of these licenses are not obligated to operate under the oversight of an IL expert license holder. In Illinois, these certificates apply to gambling, off-track bookmakers, racing, and sports venues.

However, the IGB is unable to issue any of those licenses until 540 days after the commencement of the first retail sportsbooks in IL. This countdown started on March 9, when the Rivers Casino accepted the first legal bet in the history of IL.

DraftKings and FanDuel were originally intended to be restricted or “penalized” in their operations. However, by securing authorization to manage sports betting for a master permit holder, both companies may now be able to bypass these restrictions.

DraftKings has now secured market access by negotiating a deal with the Casino Queen in East St. Louis. Currently, FanDuel is still a free agent.

If the current trend continues, all the major online sports betting companies will already be positioned before the three online-only licenses become available, potentially providing a variety of online betting options for bettors in Illinois.