Legal NFL wagering has stopped growing. The American Gaming Association projects $29.5bn in handle this season, essentially flat against $29.4bn last year — the first plateau since the Supreme Court struck down the federal sports betting ban in 2018. The same eight-year expansion that took sportsbooks into most states is nearly exhausted: for the second season running, no state enters its first NFL season with legal sports betting, and the next several months are the window in which roughly 60% to 65% of annual commercial sportsbook handle is generated.
The AGA’s explanation is a competition story, and it says so directly. President Bill Miller’s statement credits the growth of legal sports betting, then adds: “But this year is different. Since the widespread launch of backdoor sports betting on so-called ‘prediction markets,’ the growth of legal handle has stalled.” The “backdoor” framing is worth reading for what it is: the American Gaming Association represents regulated casinos and sportsbooks, which are now losing customers to exchanges supervised in Washington rather than by the states that write their advertising, promotional and responsible-gambling rules. Its complaint is about market share.
The competitors in the same release
The same operators the AGA speaks for are buying into the thing it calls backdoor betting. DraftKings plans to invest another $200m to $300m in prediction markets this year, most of it in the second half, and has put sportsbook, predictions and a rewards currency in one app. Fanatics has done the same. FanDuel is expanding its own prediction markets. BetMGM is the exception: Nevada holds that prediction markets are illegal gambling, so BetMGM cannot participate and is instead deepening same-game parlays, cash-out and a rewards hub tied to MGM Resorts benefits.
The volume on the exchange side is not marginal. Kalshi recorded $41bn in notional volume in July, more than 5,400% above a year earlier, with sports accounting for 82.2% of trading. The first full Saturday of college football produced $2.3bn in a single day, Kalshi’s busiest on record, and seven days into September the month already ranked as its seventh-largest ever.
Whether that is cannibalizing state-regulated sportsbooks or supplementing them is contested. Citizens projects prediction markets will generate more than $400bn in notional volume between kickoff and the Super Bowl, but its analyst Jordan Bender found that customers who used both products increased their sportsbook wallet size by 27% on average in the six months after adopting prediction markets, and that only 4% of onshore sportsbook handle has migrated entirely to exchanges. Citizens expects September sportsbook handle to fall 10% to 15% — partly because the NFL schedule has 16 fewer games — and still projects a record $35bn in football-related sportsbook handle for the season, up 5%.
More spending for a flat pool
The clearest signal in the numbers is not about growth in demand but about the cost of competing for a static supply of it. Flutter’s US sales and marketing expenses rose 61% year over year to $353m heading into the season. FanDuel’s promotional spending rose to 5.4% of sportsbook volume from 4%, after a strategy that FanDuel itself acknowledged contributed to market-share losses last season.
Customer behaviour points the same way. An Optimove survey of 926 US adults who bet on the NFL last season found 64% expect to use at least two sportsbooks and 16% three or more, while 84% have heard of prediction markets and 60% plan to trade event contracts this year. Ease of use was the top reason for choosing a book (59%), ahead of payouts (43%) and promotions (31%).
Nothing in this reporting concerns gambling’s costs to the people doing it. The story is told in handle, promotion budgets, payback periods and court timelines; the one consumer-protection measure mentioned is an operator’s injury-protection feature, credited by its owner with saving nearly 200,000 NFL bets last season. A flat market that operators must spend 61% more to contest is a business problem for the companies. The question it leaves open is whether a saturated market with rising acquisition costs produces more restrained advertising or more of it — and the early evidence, including prediction markets buying advertising outside state rules, points to the second.