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Illustration: Rebecca Zisser/Axios

The Supreme Court yesterday struck down a federal ban on sports betting, with New Jersey expected to allow wagers in time for the NBA Finals.

Bottom line: There will be wide-ranging consequences that authors of the old rule could have never imagined, such as gambling on e-sports.

States will act before Congress. Rep. Frank Pallone (D-NJ) last year introduced a consumer protection bill called The Game Act, but tells Axios that it was unable to gain momentum until SCOTUS ruled.

  • Pallone also doesn't think sports betting will significantly increase, arguing that gamblers have always found a way. Expect him to be surprised.

E-sports might be the big winner here, as the struck-down statute didn't define "sports."

  • Scott Cooley, a spokesman at sportsbook BetDSI, says: "This decision is going to send e-sports into another stratosphere. The offshore market has offered e-sports odds, futures and props for a handful of years. I believe you can bet on e-sports in Las Vegas occasionally, but the offerings are scant... One day it may be bigger than all of the traditional sports."
  • This could present a big market opportunity for Amazon, which owns e-sports streaming giant Twitch.
  • It also could create new cybersecurity costs and concerns, particularly if most of e-sports' financial gains/losses migrate away from the participants.

This is a lifeline to daily fantasy sports companies like DraftKings and FanDuel, both of which will quickly move into the "game results" betting business. It also eventually lets them drop the absurd claim that they aren't gambling platforms.

The NBA and other sports leagues will be emboldened to demand a piece of the action, but it remains unclear how they will go about it outside of their own arenas (MSG Casino?). If figured out, this could offset possible TV revenue declines. And, even if not, more sports betters should increase viewership.

There will be a boom in sports betting-related startups. One sports exec says he got 40 emails from VCs after yesterday's ruling.

Go deeper

5 hours ago - Politics & Policy

Rahm Emanuel floated for Transportation secretary

Rahm Emanuel. Photo: Joshua Lott for The Washington Post via Getty Images

President-elect Biden is strongly considering Rahm Emanuel to run the Department of Transportation, weighing the former Chicago mayor’s experience on infrastructure spending against concerns from progressives over his policing record.

Why it matters: The DOT could effectively become the new Commerce Department, as infrastructure spending, smart cities construction and the rollout of drone-delivery programs take on increasing economic weight.

6 hours ago - Politics & Policy

Biden turns to experienced hands for White House economic team

Illustration: Sarah Grillo/Axios

Joe Biden plans to announce Cecilia Rouse and Brian Deese as part of his economic team and Neera Tanden to head the Office of Management and Budget, sources tell Axios.

Why it matters: These are experienced hands. Unveiling a diverse group of advisers also may draw attention away from a selection of Deese to run the National Economic Council. Some progressives have criticized his work at BlackRock, the world's largest asset management firm.

Biden taps former Obama communications director for press secretary

Photo: Mark Makela/Getty Images

Jen Psaki, who previously served as Obama's communications director, will serve as President-elect Joe Biden's press secretary, the transition team announced Sunday.

The big picture: All of the top aides in Biden's communication staff will be women, per the Washington Post, which first reported Psaki's appointment.