“In the last few hours, our dream became real, and our company just became substantially more valuable.”
The Seattle startup was celebrating today after the Supreme Court ruled that a federal ban enacted in 1992 on sports betting is unconstitutional, allowing states to legalize sports betting and creating a flurry of business opportunity for companies like Unikrn.
Founded in 2014, Unikrn runs an esports betting platform. The company is venture backed and also raised $31 million in an initial coin offering this past October for UnikoinGold, a cryptocurrency created by Unikrn that can be used on its platform to bet on esports matches.
Why is Monday’s ruling such a big deal for the startup? Just ask Mark Cuban, the Dallas Mavericks owner and an investor in Unikrn who also particpated in the UnikoinGold ICO.
“Unikrn is going to benefit significantly,” Cuban told ESPN. “I don’t think people realize that gambling is legal in 118 countries already. Unikrn and Unikoin already have a foundation. They already have the technology in place. Now it’s just about leveraging up depending on what each individual state decides here in U.S.”
Unikrn CEO Rahul Sood told GeekWire that Monday’s ruling was “one of the biggest decisions we have been waiting for.”
“In the future, people across the U.S. will be able to bet on esports online using the Unikrn platform,” he said.
In the blog post, Sood explained how Unikrn has been preparing for this moment, building out its betting platform in regulated countries. The former Microsoft Venture GM also applauded the Supreme Court decision.
“By letting states regulate and offer sports betting, the U.S. government is letting betting experiences become better-regulated and undermining illicit, offshore and black market operations that endanger their users,” he wrote. “In esports, legal betting will undermine the betting pools that power skin-betting, illicit betting activity that reprehensibly sucks in minors and at-risk bettors with no regulation or know-your-customer (KYC) practices.”
Cuban said the NBA, which has supported legal sports betting, can use its new NBA 2K esports league as a proving ground for the new laws.
“You start betting on 2K, prop bets on 2K — it just explodes,” Cuban said. “At Unikrn, we’ll be paying close attention.”
Cuban also told CNBC that Monday’s ruling doubled the value of professional sports franchises. He said it will create a new form of entertainment.
“It can finally be fun to go to a baseball game again, all that down time,” Cuban said. “It’s easy to see how you’ll have fun at the arena, at the stadium, and while you’re watching it, whether it’s online or on traditional TV.”
Unikrn wasn’t the only company happy with the Supreme Court’s decision. It’s a boon for DraftKings and FanDuel, the venture-backed daily fantasy sports platforms. DraftKings, which has nearly 10 million users, plans to offer a sports betting product later this year.
“Our mission has always been to bring fans closer to the sports they love and now, thanks to the wisdom of the Supreme Court, DraftKings will be able to harness our proven technology to provide our customers with innovative online sports betting products,” DraftKings CEO Jason Robins said in a statement. “This ruling gives us the ability to further diversify our product offerings and build on our unique capacity to drive fan engagement.”
DraftKings & FanDuel became infinitely more valuable in the last 30 minutes. With the database of gamblers and tech they built with daily fantasy over the last three years, they have a chance to be a winner here. That’s what investors still in those companies had bet on.
— Darren Rovell (@darrenrovell) May 14, 2018
New Jersey is expected to be the first state to enact new legalized sports betting laws, with others to soon follow. ESPN reported that most states plan to eventually offer online and/or mobile wagering; each will create their own rules and regulations around sports betting.
From blockchain to data storage, new technology will undoubtedly play a central role as companies figure out how to make money off fans betting on sports.
I am too. I’m just amazed how foolish people are to suggest that all the advanced analytics means people will win. It’s HARD to win
— Scott Van Pelt (@notthefakeSVP) May 14, 2018
While some states may stay away from legalized sports betting, the opportunity for potential tax revenue is massive. Americans place $150 billion on illegal sports bets, Bloomberg reported. Shares of gaming and casino companies jumped after Monday’s ruling.
“Today’s ruling makes it possible for states and sovereign tribal nations to give Americans what they want: an open, transparent, and responsible market for sports betting,” American Gaming Association (AGA) President and CEO Geoff Freeman said in a statement. “Through smart, efficient regulation this new market will protect consumers, preserve the integrity of the games we love, empower law enforcement to fight illegal gambling, and generate new revenue for states, sporting bodies, broadcasters and many others.”