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NGCB Rejects Sports Betting Exchanges…Again

The Nevada Gaming Control Board (NGCB) has once again rejected a proposal for bringing sports betting exchanges to the state where the modern gaming industry was born. Last week’s decision was a body blow to ProSwap, the sports betting exchange operator that’s been trying since 2021 to convince the NGCB that sports betting exchanges have a place in the Nevada gaming ecosystem.

It’s unclear exactly why the NGCB is taking such a strong stance against betting exchanges, but ProSwap’s early history in the state likely didn’t endear the company to regulators. ProSwap began operating its service, which connects buyers and sellers of unsettled sports bets, back in 2021. The NGCB quickly shut down the service for operating without a gaming license.

Part of the problem with ProSwap’s plan to operate in Nevada is that the state doesn’t really offer a gaming license that fits their business model. Undaunted, ProSwap is backing a regulation change creating a betting ticket resale service provider category that would let them operate in a regulated environment. Unfortunately, that’s the concept that the NGCB shot down last week.

Speaking at a public hearing, NGCB Chair Kirk Hendrick shared his concerns about betting exchanges saying, “I’m a big believer in new concepts and entrepreneurship… but I have a number of concerns about this activity in Nevada. Is this something the Nevada gaming industry needs and customers in Nevada need and want?”

While Hendrick’s comments about how demand there would be for sports betting exchanges seems like a pretty weak argument, he did suggest that the service could be used by money launderers.

Sports betting exchanges have struggled to find a place in the US gaming industry, though the business model was recently approved for operation in Colorado and New Jersey.