The Rise of Sports Betting in Canada

July 26, 2022
Image by Scott Webb from Pixabay

When it comes to gambling, Canada is one of the most liberal jurisdictions. The Canadian government’s policy on it is pretty relaxed. South of the border, there is nothing like Canada’s provincial sports lotteries. No Canadian has ever faced prosecution for signing up with an online bookmaker.

A recent survey showed almost 20% of Canadians consider gambling morally acceptable, and over half believe no one has any reason to object to it.

Among the operators on the Canadian market are:

  • BetRivers
  • BetMGM
  • Bet365
  • DraftKings
  • Caesars
  • FanDuel
  • Unibet
  • The Score Bet

Ontario is one of the most dynamically developing gambling markets in the world, with sports betting being as popular as casino betting. The best Ontario casino sites cater to all kinds of gamblers but remember that 19 and not 18 is the legal age to bet in this province.

Now, let’s go back to the rise of sports betting.

It all Started With Internet Access

When the internet’s popularity exploded around 30 years ago, people had the ability to communicate far more easily and efficiently than ever. Suddenly, they had a vast volume of information, which created new possibilities to bet on sports. In Canada, the Criminal Code bans platforms from operating brick-and-mortar sportsbooks, but it’s possible to bet on offshore sportsbooks offline.

Sports Interaction and Bodog

The platform Sports Interaction was set up in Kahnawake Mohawk Territory in 1997, transforming the course of sports betting in the country. Sports betting’s next milestone was the establishment of Bodog in 2000. It was founded by Calvin Ayre and ultimately made him a billionaire.

The entrepreneur got the idea to create a sports betting site after reading an article about an offshore operator that accepted sports wagers over the phone. Ayre was a pro at network design, which saved him a lot of money and enabled him to make consistent improvements to his site. He marketed himself as the face of Bodog, a name he chose wisely.

Bookmakers’ Low Entry Barrier

iGaming was also legalized under the Safe and Regulated Sports Gaming Act. Niche sites predict that Ontario will generate 1 billion Canadian dollars in online gambling revenue with an adult population of over 12 million. That’s comparable with Pennsylvania, New Jersey, and other leading and legal US markets. What’s more, that number could double in just several years.

Since Ontario doesn’t mandate operators to partner with brick-and-mortar entities, the entry barrier to this market is low. Providers must pay a fee of $100,000 and 20% tax. Compared to most US states, the fee is low. The tax rate isn’t, but states like New York have it much worse (51% tax).

The private sector might end up competing with the government if more jurisdictions allow multiple commercial entities and launch through their lotteries.

The end of DFS in Ontario?

Ontario’s Alcohol and Gaming Commission has imposed restrictions on promoting and marketing DFS (Daily Fantasy Sports). Canadians only have access via the apps. FanDuel and DraftKings, the only DFS operators in Ontario, announced they’re pulling out of the market.

In most US states, DFS is considered a skill-based game. This fact enabled providers to enter most markets before making this type of betting legal.

However, FanDuel and DraftKings have not announced plans to leave any other Canadian provinces. They are expected to keep offering DFS contests until the respective provinces regulate sports wagers.

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