The booming US sports betting industry, generating nearly $17bn in 2025, is under increasing scrutiny due to addiction crises and integrity scandals.
Regulators are shifting towards harm reduction by implementing stricter frameworks to manage aggressive marketing, enhance self-exclusion tools and scrutinise algorithmic betting ethics.
Since the repeal of the Professional and Amateur Sports Protection Act (PASPA) in 2018, the US sports betting industry has experienced unprecedented growth, yielding economic gains but also raising public health and integrity concerns. Lawmakers are now transitioning from promoting the industry to mitigating its adverse effects, aiming to balance commercial interests with consumer protection and the integrity of sports competitions.
The industry’s rapid post-PASPA expansion has been accompanied by addiction crises and match-fixing scandals. Features such as live, in-play wagering on mobile apps exploit cognitive biases, leading to an increase in calls to gambling addiction hotlines. Moreover, the integrity of sports has been compromised by several unsavoury incidents.
The Supreme Court’s 2018 decision to overturn PASPA paved the way for state-sanctioned sports betting to thrive. However, recent events, including an NBA gambling scandal in late 2025 and early 2026 and the FBI charging 26 college basketball players with point shaving, have prompted a regulatory response.
In February, New Jersey lawmakers introduced a package of responsible gambling reform bills, with New York following suit.
Regulators are now examining the ethics of algorithmic betting, and impending regulatory measures will dictate the legal deployment of these algorithms. Industry operators must adapt by investing in compliance, user protection technology and sustainable acquisition models, rather than relying on aggressive customer acquisition strategies that exploit harmful behaviours.
While the US sports betting industry’s growth has undoubtedly driven economic benefits, it has also highlighted significant public health and integrity issues. The focus us is now very much on mitigation efforts to protect vulnerable consumers and ensure that the credibility of sports events remains intact.
Source: NYC Today
