Pick'em DFS: Laws To Know For Peer-to-Peer Contests

Since legalization, sports betting and fantasy sports contests have exploded in popularity. After a U.S. Supreme Court ruling opened sports betting to states, most now allow some form of sports gambling. However, there is a difference between sports wagering and fantasy sports contests.

In most states, sports wagering is gambling, but daily fantasy contests are games of skill. Games of skill don’t have the same state regulations as gambling. Betting on daily fantasy sports pick ’em contests generally involves peer-to-peer arenas where you compete against other players instead of a sportsbook operator.

Daily fantasy sports players should understand state laws and regulations governing peer-to-peer (P2P) contests to understand their legal rights. For more information about P2P fantasy betting, talk to a local gaming law attorney about your legal options.

What Is Daily Fantasy Sports Pick’Em?

There are many types of sports betting options available for sports fans who can make money betting on their sports knowledge. Online gambling platforms allow bettors to wager on NFL and NBA games with the standard moneyline or point spread bets. Just as popular are daily fantasy sports pick ’em games, fantasy leagues, and proposition betting.

In a daily sports fantasy (DFS) pick ’em style game, the players can make money on daily games instead of season-long league tournaments. In a DFS pick ’em contest, players select whether individual players will go higher or lower than their predicted stats. Pick ’em games are similar to over/under bets in traditional prop betting.

Depending on the game, participants can generally pick from two to eight or more players in an entry. Pick ’em games use a parlay betting system, where your bets must win to get a payout. If all your picks are correct, you can win real money. If just one bet loses, the entire parlay loses. However, in some contests, you can also flex to win something even if not all your picks are correct.

For example, a Tennessee quarterback is predicted to get 20 points in an NFL game on Sunday. Based on your sports knowledge, you believe the player will get fewer points. You can select the quarterback as part of your DFS pick ’em game to go under their predicted stats. Along with two other players, you pay your entry fee for your three-player lineup DFS pick ’em contest. Two of the three bets are correct, and you lose your entry fee.

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Are Daily Fantasy Sports Contests Legal?

Daily fantasy sports betting differs from sports wagering. There are different legal restrictions and regulations, fees, betting platforms, and mechanisms.

Some bettors and gaming platforms allow both types of betting. Players should understand the differences between DFS gams and sports wagering.

Daily Fantasy Sports Are Games of Skill

In most states, DFS gaming contests are games of skill, not games of luck. Players compete in a head-to-head or arena format and generally select their lineup to face others, with the highest-scoring lineup winning a portion of the payout.

Players often have lower entry fees for DFS games. The fees support DFS operator platforms rather than going to a casino or sportsbook. Popular fantasy sports operators include PrizePicks and Underdog Fantasy.

Sports Betting Is Gambling

In sports wagering, there are generally fixed odds for different types of bets (point spread, over/under, and moneyline). Bettors play against the casino sportsbook or online sports betting platform.

In most states, this qualifies as gambling and is regulated under state gambling laws. Some of the most popular sports gaming apps include DraftKings and FanDuel.

What Jurisdictions Allow DFS Contests?

Almost all states allow DFS sports contests. In most of these states, DFS gameplay is based on knowledge, skill, and research. This is not considered gambling and is not regulated by gaming commissions in most states.

The states where general DFS games are not permitted include:

• Hawaii
• Idaho
• Montana
• Nevada
• Washington

These states generally allow DFS games as long as no money is involved. Paid DFS games are prohibited. Unlike the majority of states, these states consider daily fantasy to be a form of illegal gambling. For example, in Washington, sports wagering is illegal except at qualifying tribal casinos.

The Attorney General of Hawaii stated in an opinion, “We conclude that daily fantasy sports contests constitute illegal gambling under Hawaii law.”

Nevada considers DFS gaming as gambling. Under their state gambling laws, operators of fantasy games require a license to operate a sports pool.

Other states are changing their stance on DFS pick ’em games, treating them more like gambling than games of skill. The Attorney General of California stated in an opinion that DFS pick ’em contests are illegal sports gambling, but fantasy sports operators continue to operate in the state.

Legal Advice About Betting on Fantasy Sports Games

For most adults in the U.S., betting on fantasy sports games is legal. Only a handful of states consider fantasy sports betting to be gambling. However, fantasy sports bettors must still comply with state gaming laws, which may include age restrictions, betting limits, and other legal requirements.

For more information about daily fantasy sports betting laws, contact an experienced gaming law attorney.