Colorado Sports Betting Market Soars as October Handle Hits All-Time High

Betting activity in the state of Colorado has increased over the past months. In October, the state recorded $210,719,821 in handle, which marks a 1.48% increase from the $207.7 million recorded in September.

That increase in bets, no matter how small it might seem, was accompanied by a significant increase in revenue from $4.2 million to $17.4, ultimately resulting in increased tax revenue for the state. The Department of Revenue in Colorado said, “In October, the total taxes collected was $824,700, representing a 91.5% increase over September 2020 and the largest amount collected since legalization in May 2020.”

People might have expected to see the state rake in a larger amount from the sportsbooks. However, this is not the case because there is a tax reduction on promotional play that was left for sportsbooks. A document explaining the taxation process of the state government’s site reads, “When you compare the reports from August 2020 and September 2020, you will see a few discrepancies in the calculations of the Total Taxes Due. September numbers are not quite 10% of the NSPB. That is because operators offered millions of dollars in free bets and promotional plays as sports started coming back online. In some cases, the tax credits exceeded the tax owed, allowing operators to carryover a negative tax amount to the following month. These carryovers skew the numbers to show a lower tax rate. As we average the reports throughout the year, we should see them even out.”

Big Impact by Football

99% of all bets placed in Colorado for October was through online channels. 32.3% ($67.98 million) of that total was accounted for by NFL wagers. Major League Baseball accounted for 10.9% of the overall handle – $23.04 million.

The struggles of the Denver Broncos are in no way deterring Colorado bettors from wagering on the NFL. These numbers also confirm that the NFL is the favorite sports to bet on in the state, as is the case in other states. It was a smart move by the Centennial State to launch online betting at the height of the coronavirus shutdown. It has ensured that revenue from gambling continues to flow into the state’s purse despite land-based casinos closure. Sixteen operators were responsible for raking in the October handle and we might see an increase in November.

Online is Important

Most US states first allowed sportsbooks to offer sports betting through land-based casinos before moving online. Colorado broke that cycle and immediately allowed gaming companies to roll out online and mobile sports wagering platforms. Even as online betting is relatively new in the state, it is now very close to being among the top five sports betting markets in the US. It is very close to overtaking Indiana (5th), whose sports betting went live in September 2019.

Several high profile operators are still waiting in the wings, and with their introduction, we are sure to see an increase in the betting handles. Barstool is looking to launch its sports betting app in early 2021, while PointsBet launched in November. It is expected that more sportsbooks will come into the market as these early results are sure to pique their interest.

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Jackson
Our in-house expert for all things regulation, Jackson covers all major recent developments across US states relating to gambling laws & legislation.