Tennessee Sports Betting

The battle for legal sports betting in Tennessee was a tough one, to say the least. Originally projected to offer sports betting early in 2020, the start date was pushed back repeatedly as operators fought with the state over the hold requirement.

The state originally placed a “hold rate” of 15% on all gross revenue brought in at sportsbooks. This was roughly double the 6-8% you find in the other states that offer legal sports betting. The state legislatures eventually discovered just how big of a mistake they made after passing the bill, setting the hold rate, and opening the state up to business only to find zero books enter the market.

Obviously the 10% hold rate is still significantly higher than the current national average, but will operators pay it? Early indications are yes, but not out of their own pockets. Rather, Tennessee players can expect to see increased juice, likely as high as -120 in simple spread bets.

So, why is this significant? People want to bet, they are likely to pay the increased juice to do so, right? Not necessarily. Keep in mind, the goal for the state of Tennessee should be to run offshore books out of business in the state. If a player can make the same bet in two places, but one has a 10-15% higher payout why wouldn’t they bet there?

Anytime a Tennessee resident places a bet with an offshore book it not only is bad for the player but it is missed revenue for the state. Had legislatures originally proposed a bill with realistic requirements sportsbooks would already be operating in the state and would have likely brought in nearly $20 million in tax revenue.