If you’re looking to offer sports betting these days, you might be more inclined to call the CFTC than the ADG.
After all, federally regulated prediction markets now offer a near-nationwide alternative to state-licensed sports betting. Why pay for a gambling license and state taxes to operate in just one market?
And yet, that’s exactly what Circa Sports and CEO Derek Stevens are doing in Arizona. The Arizona Department of Gaming (ADG) announced Monday that it had allocated an online sports betting license to Circa as a designee for the San Juan Southern Paiute Tribe.
“With Circa's unique … low-hold model, we've got to have the right regulatory environment in place,” Stevens told Covers in an interview Tuesday. “We have to be able to cut a type of deal that makes sense."
- Circa Sports chose to enter Arizona because the regulatory environment fits its low-hold business model, the market is mature, and its proximity to Las Vegas creates cross-promotion opportunities.
- CEO Derek Stevens believes Circa can attract experienced bettors by launching after the initial wave of sportsbook competition and focusing on its distinct approach rather than heavy marketing.
- Stevens remains confident in state-regulated sports betting, arguing prediction markets face regulatory and legal challenges that make their long-term outlook uncertain.
In Arizona, everything lined up (including the fact that the tribe's old partner, Betway, exited the U.S. entirely), and the state will be Circa’s seventh market in the U.S. for its online sportsbook. It will also be the fourth market in which Circa will use its new sportsbook technology.
The ADG said it is now working with Circa on the “next steps,” and Stevens said their goal is to launch in Arizona in January 2027.
Stevens is eyeing additional markets, too, although he said the company doesn't have “another deal in the hopper” at this point.
Nevertheless, the CEO aims to keep growing the online business through the state-regulated model that was historically the only way to do it - until it wasn’t - and for reasons he sees as solid.
📢 TODAY: ADG has allocated an event wagering operator license to Circa Sports Arizona LLC as the designee for the the San Juan Southern Paiute Tribe.
— Arizona Department of Gaming (@AzGaming) August 3, 2026
Full press release here: https://t.co/g9Ogzm59CZ pic.twitter.com/jYSjNJQE6q
For starters, Arizona neighbors Nevada, and a lot of Arizona customers already walk through the doors of Stevens’ properties in Las Vegas, namely, the brick-and-mortar Circa, the D, and the Golden Gate.
So there’s already some familiarity between Arizona sports bettors and Circa. An Arizona user of the Circa Sports app could be easily nudged toward Vegas.
Stevens said the company plans to provide “a substantial amount of additional benefits” for Arizona users, with some tie-ins to Vegas as well.
A long time coming
Arizona launched legalized sports betting back in 2021. That means the Arizona sports betting market and the bettors who populate it have had nearly five years to mature, to learn what they like and don’t like, and, in some instances perhaps, to be turned away by certain online sportsbooks for betting too big or winning a bit too much.
More than $35 billion has been bet in the state, according to the ADG. Now along comes Circa, with a low-hold, high-volume model that caters to a sharper and deeper-pocketed bettor.
“We think we bring something different to that market,” Stevens said.
In addition to proximity and maturity, Circa can also come in and shake things up in Arizona after the dust of its online sports betting launch has been settled for some time. The operator has only done one Day 1 launch, which was Missouri last December.
In Arizona, there's no more rush to partner with anything that moves merely for advertising opportunities, or to blow big sums of cash on marketing and promotion in general. The bettors are there, and you can introduce yourself at your own pace. You might already know them, too.
Circa is not going to be the biggest online sportsbook in any given state. In Missouri, for example, Circa took $2.2 million in bets in June, compared to $76.3 million for FanDuel.
However, as Stevens sees it, spending a ton on advertising still makes more sense for operators interested in taking a dozen smaller bets a day from as many customers as possible. Circa, meanwhile, can take bigger bets from customers over a longer period.
“I enjoy coming in after the hurricane or the tornado of launches come about,” Stevens said.
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After the gold rush
And then there’s the fact that Stevens just doesn’t believe the sports prediction market gold rush will last.
The CEO doesn’t think states are just going to give up the jobs and tax revenue tied to legal sports betting, or that the Commodity Futures Trading Commission (CFTC) is “remotely prepared” to regulate what he sees as just more gambling.
While the CFTC and prediction market operators believe federal legislation and regulation shield them from state-level gambling rules, the growing number of legal challenges involving sports prediction markets suggest the states aren't just going to go away.
We try to stay humble, we REALLY do. But sometimes... 💅
— Circa Las Vegas (@CircaLasVegas) July 29, 2026
#CircaLasVegas #DTLV pic.twitter.com/HXaSJN4ncU
States are indeed fighting back, including 44 that signed on to a letter to the CFTC urging the agency to “clarify that sports bets and gambling cannot be traded on (prediction markets) but are instead subject to state law.”
Those federal regulatory efforts are in addition to the court battles that are raging across the U.S., such as a recent win for Utah in its fight with Kalshi.
Stevens says he still believes "reasonable heads will prevail" and the historical state-by-state regulation of gambling will carry the day.
“I just don't think that it's a reasonable position to think that these pirates of the prediction markets are able to come in and successfully do an end-around, not paying state taxes, not paying federal excise taxes, not paying league fees, not paying data fees,” Stevens said. “I think that's a very cavalier position.”
