Colorado Sports Betting Market Has Second-Best in West Potential, Could Reach $6 Billion

Colorado s sports betting market could be one of the most lucrative in the Western US, assuming there are events for gamblers to bet on May 1 when sports wagering will officially be permitted in the state.

Last November, Centennial State voters narrowly – the ballot initiative setting the stage for legalized sports betting. Backers of the plan sold it as a way of plugging shortfalls in the state s water budget, an increasingly vital issue, as Colorado s population is expected to swell over the next several decades.

The Centennial State has a bright future, capable at maturity of annually generating as much as $6 billion in bets, $400 million in gross operator revenue, and $40 million in tax revenue,” according to forecasts from PlayColorado.

Those projections are well above some estimates floated around prior to the Prop DD, which said the state s sports betting market could be worth $2 billion while generating, at the high end, $20 million in tax receipts.

Assuming Colorado opens sports wagering on May 1, even if there s nothing to gamble on besides futures and a small smattering of international competitions, it will be the 18th state to legalize sports betting.

If the $6 billion in bets forecast is proven accurate at some point, that would likely make the Centennial State the second-largest in the West in terms of annual handle behind Nevada. Down the road, California could have some say in the competition. But because of the COVID-19 outbreak, it be may difficult for Golden State sports betting backers to place the issue before voters on the November ballot.

Colorado also has a geographic advantage in luring bettors. It borders seven other states, only one of which – New Mexico – currently allows sports wagering. Several of the others, such as Arizona and Utah, are unlikely to sign-off on the endeavor anytime soon.

Colorado has 5.69 million residents and is one of the fastest-growing states in the region. The state is also home to teams from all four of the major professional athletic leagues and three universities that play both Division I football and basketball, making it a potentially lucrative market for sportsbook operators.

The Centennial State s sports betting tax structure, which is in line with some of the largest sports wagering states, is also seen as an advantage.

“Colorado regulators have been deliberate, opting for a later start date to ensure it gets its regulatory framework right,” said PlayColorado. “Its 10% tax on net revenue is comparable to some of the most successful sports betting markets. New Jersey, which is neck and neck with Nevada as the nation s largest sports betting market, levies a 9.75% tax on revenue from retail sportsbooks and 13% on online sports betting revenue.”

The favorable tax rate, coupled with what s expected to be a robust online market, is helping Colorado attract big name sportsbook operators, , Roar Digital and William Hill, among others.