As per research and analytics firms Eilers & Krejcik Gaming and Narus, the eSports betting market handle is expected to be in excess of $12Billion by 2020. The betting platforms are not primarily a part of the eSports ecosystem, however, in recent times there has been attractive growth and investments being made in the sector.
The market is currently handled by some well known platforms and since US Supreme Court ordered to strike down prohibition on sports betting, the sector might see a growth in more players eyeing a share in the niche market.
In 2016, Valve issued cease-and-desist letters to many websites, who were offering skin betting. In the past, many websites have offered such promotions, however, it never impacted any kind of gameplay. The prohibition however, helped in the creation of eSports cash betting websites, which in turn has become a competitive market.
The eSports Gambling handle was estimated around $3Billion in 2017 due to Valve crackdown, but is expected to increase industry revenue by atleast $3Billion each year from 2018 onwards, resulting in an estimated revenue of around $12Billion by 2020.
eSports betting formats are different than regular sports betting formats, with eSportsbook betting, Fantasy eSports and Head-to-Head betting being the major types of betting formats. League of Legends Championship is currently the most popular title by betting volume, almost having 40% of market share, followed by CS:GO at around 30%, DOTA 2 at around 20% and the rest accumulating for the remainder of the market. eSportsbook betting is the most traditional format of betting, accounting almost 95% of total $ wagered by style of play by users.
eSports are exclusively watched online via streaming services provided by Twitch, YouTube and Mixers, while linear TV broadcasting of major events are also on the increase in the recent times. With legalization on betting, Sports organizations and promotions can increase the fees for broadcasting rights and ticket sales price, thus increasing the overall revenue for the Industry.
What more, with 2022 Asian Games in China likely to include eSports as an official medal sport, the betting market will be deep diving in a revenue generating frenzy.
Data sources include brokerage firm reports and Industry sources