s of recent, online advertisements and television commercials have been overwhelmingly dominated by daily fantasy sports providers FanDuel and DraftKings. Together, these two companies have spent a ridiculous $150 million on marketing in the third quarter alone. Daily fantasy sports is the idea of maintaining regular fantasy sports teams on a day-by-day basis to reduce the required commitment that would entail a full-season fantasy sports team. With these sites, you wager real money to select your team of pro athletes who accumulate points over the course of the day to form your total score. So what is the big deal with fantasy sports? Putting aside the annoyance of the ads that are everywhere, many have concerns that the average Joe is almost guaranteed to lose his money. If so, fantasy sports should be regulated as if they were gambling. One study found that the top 1.3% of daily fantasy players make approximately 91% of the profits. So do these at-risk fantasy players need protection? Currently, there are some protections in place. About 80% of the participants on these sites lose less than $10 a month, and caps have already been placed on players’ betting (although they are quite lenient). Many have compared the fantasy sports world to that of day-trading in that it is an equally effective way to blow through cash for an unknowledgeable investor. Neither is considered gambling by Congress; both rely upon the fact that some sort of inherent skill is required to do well. Unfortunately, it will always be dangerous for middling fantasy players, along with your typical day-traders, who will both inevitably get hammered when there are masters in the field going against them. But banning DraftKings along with online brokerages like E-Trade is not the answer. We should instead offer coaxing regulation, similar to the effect of the capital gains rate on short-term holding, to increase sensible behavior. Only then can we assist in protecting the average minnows from the major fantasy sports sharks out to get their money.
Dominant FanDuel Fantasy Sports Player | Frontline PBS