Active NBA players may endorse and invest in NBA betting sites and fantasy sports companies, under the players union’s new contract with the league.
The NBA betting changes, first reported in a tweet from The Athletic’s Shams Charania, take effect with the start of the 2023-2024 season, according to details of the Collective Bargaining Agreement obtained by LSR. The CBA, ratified on Wednesday, marks the second time in a year player-gambling rules have been relaxed by a major American sports league.
Under the new CBA:
- Players may participate in sports betting or fantasy sports endorsement that involves general brand endorsement or endorsement of betting on non-NBA sports.
- Players may hold passive, non-controlling interest in sports betting or fantasy companies, limited to less than 1% stake for companies that offer or facilitate NBA bets or contests.
Half of NBA betting money to players
More than two-thirds of league franchises have at least one sports betting sponsor. Many teams like the New York Knicks and Philadelphia 76ers have multiple.
For teams like the Phoenix Suns and Washington Wizards, those partnerships involve physical sportsbooks inside their arenas. The league also makes money from partnerships with sports betting data providers.
Since embracing sports betting, the NBA has recognized gambling-related revenue as “basketball-related income”, subject to a 51% to 49% split between players and owners. The NFL has a similar clause in its CBA.
NBA on equal footing with MLB
Since states began legalizing sports betting, gambling prohibitions have largely prevented US athletes from appearing in commercials such as those featuring Kevin Garnett or the Manning brothers for BetMGM or Caesars until after their playing days are over. That is beginning to change.
Colorado Rockies outfielder Charlie Blackmon became the first active MLB player to endorse a sportsbook last year after MLB CBA changes similar to the NBA, though his sponsor is now defunct. NHL stars Connor McDavid, John Tavares, and Auston Matthews each have betting sponsors, though notably all three play in Canada, where sports betting is regulated differently than in the US.
NFL players may endorse casinos, though they are prohibited from anything more and multiple payers have been suspended for violating the league’s gambling policy. State laws governing name, image and likeness (NIL) rules for college athletes commonly make gambling companies ineligible for sponsorship.
Players see same rights as owners
In an era of player empowerment, players will now be afforded the same participation rights as the people who sign their checks.
Before the ratified CBA, team governors — the rebranded term for team owner — had been the sole exception to a prohibition on gameplay-related personnel controlling interest in a sports betting business.
The exception enabled Houston Rockets Team Governor Tilman Fertitta to acquire $700 million of DraftKings shares in 2021 when the sports betting giant acquired his casino brand, Golden Nugget. SEC filings reveal Knicks owner James Dolan was also a DraftKings shareholder before the company went public in 2020.
The exception also enabled Dallas Mavericks owner, Mark Cuban, to invest in Underdog Fantasy, which may be related to the rule change.
Kevin Durant, Trae Young are investors
Phoenix Suns star Kevin Durant and Atlanta Hawks star Trae Young will likely be the first players to take advantage of the loosened investment rules, though technically they already did. Both were named, along with Cuban, as Underdog investors in the release that announced the company’s plans to expand beyond fantasy sports to sports betting.
Underdog has a conditional sports betting license in Ohio and a temporary two-year license in Colorado, though there is no timetable for it to start taking bets. It has been offering fantasy sports betting contests in states that allow it since 2020.
NBA betting changes adapt to climate
As financial opportunities have softened professional leagues’ once legally hostile stance on sports betting, their embrace has not gone without controversy.
Washington Wizards star Bradley Beal is under police investigation after a postgame altercation with a fan who reportedly berated Beal for costing him a bet. Some prominent media figures around the league, like ESPN’s Adrian Wojnarowski suggested an increase in fan aggression may be linked to sports betting. NBA Commissioner Adam Silver has disavowed that theory, linking fan incidents to larger societal problems instead.
The expiring CBA took effect in 2017, months before the Supreme Court overturned the Professional and Amateur Sports Protection Act, leading to the sea change in nationwide sports betting. The new CBA runs through 2029-30 unless either side opts out after the 2028-29 season.
