The days of Las Vegas Strip casinos jostling for customers have gone the way of their buffets and free parking. Three companies now take in nearly every bet placed in America’s historic gambling epicenter at a time when legal gambling is available at more than 1,000 casinos and millions of mobile phones.
- Big gambling operators clash with smaller casinos over online iGaming expansion, with legalization stalled in most states.
- Regulated casinos and sportsbooks unite against sweepstakes/social casinos, arguing they’re untaxed and unsafe competitors.
- Prediction markets challenge regulators and could reshape gambling entirely if upheld by federal courts, bypassing state oversight.
The divides now mostly fall on the “established” stakeholders and the multibillion-dollar up-and-comers that threaten their bottom lines – and possibly even the definition of gambling. But those divides are increasingly vanishing as bigger threats emerge.
Here are the biggest splits in the gambling industry – and how many of them are united:
Big iGaming operators vs. small
The 2018 repeal of the federal sports wagering ban spurred a mobile sportsbook brawl between more than 40 companies. Within five years, FanDuel and DraftKings were accepting more than two-thirds of every dollar placed with a legal sportsbook.
Their success may have inadvertently hurt their chances at a far greater prize.
High-margin digital slots and table games running 24/7, 365 on a phone app present a far larger revenue opportunity than sports. With mobile sports betting opportunities limited, some companies that left the sportsbook wars have turned against real money online casinos.
Churchill Downs, which shuttered its sportsbook, as well as regional casino operator Cordish Companies (which runs an iCasino in Pennsylvania) have led a nationwide effort to stop the spread of online casino gambling. Framing iGaming as a gambling addiction trigger, these companies and a growing number of smaller brick-and-mortar operators have also portrayed digital slots and table games as a threat to the hundreds of thousands of employees at brick-and-mortar casinos.
$PENN CEO Jay Snowden, whose company operates online casino gaming platforms, said today that iGaming legalization its not always a good fit for all states; he cites Colorado (where Penn operates a retail property) as an example where iGaming would hurt in-person casinos
— Ryan Butler (@ButlerBets) February 27, 2025
These companies also face far greater economic harm from increased digital gaming than online-only operators such as FanDuel and DraftKings.
The duo has been joined by the other major sportsbook and iCasino market share leaders including Caesars, MGM, bet365, and Fanatics in the push for legal iGaming. But the brick-and-mortar’s arguments are winning; only four states allow competitive iGaming marketplaces.
This animosity has intensified as iGaming legalization bills have suffered rejections in statehouses nationwide. That pressure will increase with another legalization push in more than a dozen state capitols next year.
Real money casinos vs. sweepstakes and social casinos
The battling parties above are unified against what in-person and online gambling stakeholders consider a critical threat to their industry.
There are thousands of free-to-play sweepstake and social casinos available in the U.S. These games allow users to play without using real money or the ability to win cash directly. But customers can pay for certain types of coins that can be redeemed for other types of awards.
Regulated gambling operators have asked state attorneys general and federal officials to ban these sweeps games to varying degrees of success. A few states have passed bills banning these games while a few authorities have taken action to prevent their operations. A handful of operators have left a few states but countless others proliferate nationwide.
Sweeps casinos pay out in prize money between 80-96% of their revenues.
— Daniel Wallach (@WALLACHLEGAL) August 20, 2025
In Barber, the Court noted the 92% payout rate for the MegaSweeps promotion 'coincides with the industry standard for casino-style slot machines, which ‘typically pay back 90% to 98% of all money played." pic.twitter.com/Nb1kO8brWB
Free-to-play casino operators say these games are legal and attract a different customer base than real money gambling sites. Real-money operators refute that claim while telling policymakers and law enforcement officials that sweeps casinos are unregulated, untaxed and unsafe.
Some gambling industry leaders have pushed for a compromise: Legalization of real money online gambling with an opportunity for social and sweeps casinos to earn licensure. This has been a political non-starter in most statehouses, furthering the continued battle between the regulated real money gambling companies taking bets in most states and the free-to-play offerings that accept customers and advertise nationwide.
Lawmakers and their constituents are becoming increasingly aware of these games, which will again bring them into policy discussions when legislative sessions reconvene next year. With compromise unlikely, this sets up a multi-front struggle between real money and free-to-play gaming companies with no clear end.
(Sports) prediction markets vs. The World
The established brick-and-mortar gambling industry, online real money operators, and upstart social casinos all fear the impact of another type of gaming that has challenged courts to declare it's not gambling.
Prediction markets have become the biggest discussion topic among gambling stakeholders since bursting into the national consciousness with event contracts on the 2024 U.S. presidential election. Since then, sites including Kalshi, Robinhood, and Crypto.com have offered these contracts on thousands of college and professional sporting events, angering operators and regulators nationwide.
Facing cease-and-desist letters in more than a dozen jurisdictions, Kalshi has instead challenged these regulators in court, winning in Nevada and New Jersey. But the momentum recently stalled in Maryland, adding more confusion about a form of gambling (or not) that could upend the industry.
2/ First and foremost, this is FD’s stake in the ground for prediction markets. There’s no other way to read it, and there’s very little chance critical stakeholders like regulators, shareholders, and potential partners will read it any other way.
— Chris Grove (@OPReport) August 21, 2025
Prediction market sites such as Kalshi are regulated by the federal government, instead of the state-by-state patchwork for all other gambling forms (and sweeps casinos) in the country. Should Kalshi reach its long-term goal – vindication by the Supreme Court to continue operation under federal regulation – years of state-level regulatory powers could be effectively pointless.
Sportsbook operators would then leave the disparate and, in their eyes, inordinate taxation structure in many states to instead operate “prediction markets,” not sportsbooks. Gaming companies would flock to Texas and California, where sports betting is not legal, but prediction markets could be.
A final decision is not expected for years. In the meantime, DraftKings, FanDuel, and other gaming stakeholders are already ramping up their offerings on non-sports prediction markets such as commodities and stock markets, all the while assuring regulators and their gaming partners they are not accepting illegal sports bets.
But event contracts on sporting events, and the ability to parlay them, are the real prize. If the Supreme Court rules for Kalshi, it would upend gambling far more drastically than the court’s repeal of the federal wagering ban.
The leading digital-focused sportsbooks, themselves upstarts a decade ago, could be in position to again lead the new form of gambling (now “predicting”), redrawing the divides and alliances again.
