Esports Betting Could Provide A Boost For Legal Tennessee Sportsbooks

Posted on March 19, 2020 - Last Updated on March 24, 2020

When legal sportsbooks in Tennessee launch, esports betting could be among the offerings. There’s no telling when that might happen, however.

TN is still working on finalizing its regulations for sportsbooks, which, so far, is the primary task holding up the launch. The current situation creates some incentive to do that quickly.

How esports betting could be a win for Tennessee

TN’s sports betting law specifically enables wagering on esports competitions. It’s one of the few states to include such language in its statute so far.

The only requirements for eligibility in the TN law are that a governing body regulates the competitions and that the contests be that of skill and not of chance. There are some other tenets of the law that limit the markets, however.

The TN law bans wagers on competitions involving minors. That means TN sportsbooks won’t be able to post markets on Fortnite competitions involving players 18 years or younger, for example.

Additionally, what does and doesn’t qualify as a governing body is open to interpretation. Also up for debate is whether a particular title is a game of chance or skill.

The TN Lottery will likely decide those matters on a case-by-case basis. That’s likely an issue on the back burner right now, however.

Why deciding which esports to approve isn’t a high priority for lottery

Right now, the pertinent matter for the TN Lottery is finalizing regulations that govern things like application protocols and taxes. The lottery board has to finish those rules before it can start taking license applications.

After the board releases and processes them, it will likely wait for feedback from licensees on which markets they want to create. That may or may not include esports.

To date, there has been little action on legal markets in the US on esports. Some books took action on League of Legends competitions in Nevada and New Jersey last year, but that’s been about it.

That suggests demand for authorization to take bets on esports competitions may be low in TN. That demand might grow, however, if traditional sports continue in their coronavirus pandemic-induced absences.

Esports has a rare opportunity to take center stage right now because of those absences. The ironic thing, however, is that it may also be what preempts TN from taking advantage of the situation.

The Catch-22 of current situation for esports and TN

Many of the world’s premier esports competitions have altered their formats by moving contests online and/or taking spectators out of the mix. That should allow these competitions to continue while traditional sports are suspended.

Because of TN’s legal framework, the state has a unique opportunity to cash in on that situation. It must act quickly, however, as every day that passes means that the window is one day closer to shutting.

At the same time, concerns over the coronavirus might delay meetings of the lottery board and its Sports Betting Advisory Council. The process can’t move forward until those meetings happen.

TN Legislature has effectively tabled a bill that would have amended its sports betting law for the time being because of the pandemic. If that’s any indication of what could happen with the lottery, it could be a while before any more progress happens.

Regardless of when TN’s law creates a great opportunity for sportsbooks to take action on esports. The sooner that happens, the better.

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Derek Helling

Derek Helling is a lead writer for PlayUSA and the manager of BetHer. He is a 2013 graduate of the University of Iowa and covers the intersections of sports with business and the law.

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