Two daily fantasy sports (DFS) operators receiving attention in several states for offering player prop-style games have waded into the North Carolina DFS market.
The NC Courage and daily fantasy sports operator PrizePicks announced a partnership last week. Betr sportsbook, founded by Jake Paul and Joel Levy, launched a DFS product called Betr Picks in North Carolina, among other states.
Since May, four states have cracked down on fantasy sites offering games mimicking player prop-style bets, New York being the most recent. North Carolina does not have daily fantasy sports laws on the books, and with the pending launch of online sports betting in North Carolina, the North Carolina Lottery Commission (NCLC), regulator of the sports betting industry, may have to consider how to proceed with these types of fantasy operators.
Player vs. house fantasy sites
PrizePicks, which is live in 31 states, and Betr Picks, which launched in North Carolina last week and is live in 24 jurisdictions, take a distinctly different approach to daily fantasy than early DFS brands such as DraftKings and FanDuel.
Instead of pitting people who’ve created fantasy lineups against one another, the operators are giving people scenarios where they can pick stat lines for specific athletes and decide whether the athlete will exceed or fall below the stat line.
In this scenario, the player is competing against “the house” and not other players on the app. States like New York, Wyoming, Maine and Ohio have scrutinized this approach against accepted sports betting definitions.
In the cases of the three former states, all found that their player parlay-style bets were “essentially sports betting” and are taking action against offending fantasy operators. Ohio’s DFS laws disallow “proposition selection,” defined under state law as a fantasy contest where players choose “whether an identified instance or statistical achievement will occur, will be achieved, or will be surpassed.”
As such, neither PrizePicks nor Betr Picks operate in Ohio.
A challenge for NC sports betting regulators
With no daily fantasy sports laws on the books, North Carolina does not formally allow or disallow DFS – it also does not regulate it.
This could present a challenge for the NCLC if more states crack down on prop-style fantasy sites. Van Denton, director of corporate communications at the NC Education Lottery, said that the NCLC “has nothing to offer at this time” on the topic. The Commission has not yet formally met to discuss sports betting regulations though they have hired a director of sports betting.
House Bill 347, which legalized online sports betting in North Carolina, included one clause referencing fantasy sports’ exclusion as a form of sports betting:
“Nothing in this Article shall apply to fantasy or simulated games or contests in which one or more fantasy contest players compete and winning outcomes reflect the relative knowledge and skill of the fantasy contest players and are determined predominantly by accumulated statistical results of the performance of individuals, including athletes in the case of sporting events.”
While disqualifying fantasy sports as a form of sports betting, the definition of fantasy sports provided, namely a contest where “one player” could compete using “relative knowledge and skill” to determine “the performance of individuals, including athletes,” seems to carve out space for prop-style fantasy sites, like PrizePicks and Betr Picks.
For the time being, that language may give some footing to prop-style fantasy offerings, but it doesn’t necessarily preclude regulators from questioning whether it is also a form of sports betting.
As Dustin Gouker, a consultant for Catena Media, NCSharp’s parent company, wrote at the Closing Line, a gaming industry newsletter, “In the Venn diagram of sports betting and fantasy sports, these products are in the overlapping sections. But just because you’re both doesn’t mean you only get treated as fantasy.”
The NCLC has recently hired a sports betting director and is in the early stages of drafting regulations for sports betting. NCSharp will be watching if and how the NCLC handles the expansion of DFS sites like PrizePicks and Betr Picks.
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