DraftKings users will soon be able to use cryptocurrency to fund their sports betting accounts. A company representative informed the Massachusetts Gaming Commission about the change last week.
Chief of Sports Wagering Division Carrie Torrisi said the company is rolling out the program in Illinois, Kentucky, New Hampshire, and Vermont. Users can convert crypto to cash in their accounts.
“Kentucky’s sports wagering regulations directly contemplate the use of digital, crypto and virtual currencies,” Kentucky Horse Racing & Gaming Corporation Director of Sports Wagering Hannah Simms told SBC Americas. “Sports wagers may be made using forms of payment approved by Kentucky Horse Racing & Gaming, including ‘cash equivalents converted to cash.’ The definition of ‘cash equivalent’ includes ‘digital, crypto, and virtual currencies.’”
Torrisi said the company’s home state of Massachusetts might have been included. However, the commission banned operators from accepting credit cards and crypto last December.
Handful Of States Don’t Allow Crypto Deposits
Simms said the KHRG worked with DraftKings on the proposal. It included a review of any vendors involved in the program and testing.
The new deposit method, however, won’t be welcomed in other markets. Some states, such as Wyoming, Colorado, and Virginia, don’t allow users to use crypto as a means of deposit.
In Massachusetts, regulators approved allowing the company to test the technology, including the segregation of crypto-sourced funds. But commissioners have expressed opposition to allowing crypto as a deposit method in the state. They cite concerns about the crypto industry’s lack of regulations and possible money laundering.
Before the Supreme Court overturned the ban on sports betting outside Nevada in 2018, crypto was a popular deposit option for offshore, unregulated operators. Accepting crypto may now offer another revenue stream for regulated sportsbooks.
The move comes as the industry is facing some headwinds in the form of rising tax rates. Along with that is the gambling tax provision in the One Big Beautiful Bill Act, which now allows gamblers to deduct from their taxes only 90% of their losses.
In August, CEO Jason Robins spoke out against the possible gambling tax changes in the spending bill.
“I do think it’s something that doesn’t make sense,” Robins said. “If you can’t deduct all your losses, how does that make sense that you pay income tax on something that’s not actually income?”
