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Colorado Regulators Ready to Drop Hammer on DFS Pick ‘Ems

Colorado appears to be the latest state to propose regulations to help clear the increasingly blurred line between regulated sports betting and daily fantasy sports (DFS) prop pick ’ems. In this case, the Colorado Division of Gaming is focusing on the fact that, unlike traditional DFS products, prop pick ’ems pit players against the house and not against other players.

The issue of player vs house DFS products will be the focus of a meeting the Board will be holding today and it’s certain that DFS operators across the country will be watching closely. What they’re going to see, however, is not likely to make them happy. In a draft version of the proposed regulation changes is a clause that clarifies the difference between playing against another customer and playing against the house. The revised definition of DFS in Colorado will read, “Fantasy contests are contests where patrons compete against other patrons. Fantasy contests where patrons compete against fantasy contest providers are prohibited.” It’s not going to get any clearer than that.

The draft regulations, according to a report on SBC Americas, goes on to define the terms of the game more clearly saying, ““Fantasy contests must include the following:

A) The selection of a minimum of two athletes or positions, or the utilization of statistics from a minimum of two athletes or positions
B) The outcome of the contests must be based on adding together the fantasy points from at least two athletes or positions”

Representatives from OwnersBox, a Colorado-licensed DFS operator, defended the practice on a skill-vs-luck argument saying, “It is crucial to distinguish between those house-based contests that genuinely promote skill, knowledge, and participant interaction, as opposed to those that primarily involve chance or replicate traditional gambling activities. Categorically excluding all house-based contests may unfairly limit innovative, skill-based variations that can offer unique and engaging experiences while staying within the bounds of the Fantasy Contests Act.”

Given the momentum building against these kinds of contests, and the outright bans in states like Michigan, it’s unlikely that argument will hold much water with regulators.