South Dakota took another step toward mobile sports betting after its Senate backed a ballot measure that would allow voters to decide whether to allow online wagers. The state Senate approved Senate Joint Resolution 504 on Wednesday, by a vote of 23-10, bringing the state closer to a significant potential expansion of its betting market.
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The resolution would place a question about online sports betting on the ballot for the general election in November 2026. The legislation now moves to the South Dakota House of Representatives, where it will face another voting process before it can definitively reach the voters.
This legislative advancement represents a significant shift in the state’s stance on mobile betting, following previous attempts to expand online commerce that failed in the state legislature in prior years.
Background of Sports Betting in South Dakota
South Dakota voters approved sports betting in the casino town of Deadwood in 2020, marking the state’s entry into the legal sports betting industry in the United States. However, lawmakers restricted betting to in-person wagers in Deadwood during the 2021 legislative session, significantly limiting the market’s growth potential.
Since its launch in September 2021, Deadwood’s sportsbooks have handled $38.9 million in total bets, generating $3.9 million in gross revenue, according to reports from the South Dakota Commission on Gaming. These figures reflect the limitations of an exclusively in-person model in a state with a dispersed population and vast geography.
Previous legislative testimony suggested that monthly online sports betting in South Dakota could exceed $17 million if the mobile format were legalized. This projection is based on comparisons with neighboring states and analysis of consumer patterns in similar markets.
Comparison with Neighboring States and Market Potential
A comparison with Wyoming illustrates the untapped potential of South Dakota’s market. Wyoming, with 400,000 fewer residents than South Dakota, has achieved monthly online sports betting exceeding $25 million since legalizing mobile wagering.
This substantial difference highlights how the restriction to in-person betting has limited the industry’s development in South Dakota. Proponents of online expansion argue that the state is losing significant tax revenue that could be allocated to public programs and tax reductions.
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Furthermore, data presented during legislative hearings revealed that there are 55,000 registered online sports betting accounts with declared addresses in Wyoming that likely belong to South Dakota residents who cross the state border to place legal mobile bets.
Concerns About Illegal Operators and Prediction Markets
Lawmakers also expressed concerns about the prevalence of black market online operators. These platforms operate outside the law, without regulatory oversight, consumer protections, and without generating tax revenue for the state.
Illegal operators pose additional risks to consumers, including the possibility of outcome manipulation, lack of guarantees for prize payouts, absence of responsible gaming tools, and potential use of the platform for money laundering or other illicit activities.
The proliferation of prediction markets, which allow betting on political, economic, and social events beyond traditional sports, has generated further regulatory debates about the appropriate boundaries of legal betting and how to differentiate between gambling and legitimate information markets.
Political Context and Other Constitutional Amendments
The South Dakota legislature approved four other constitutional amendments in the last session, which will be put to a vote in November 2026 alongside the online sports betting proposal. This context suggests that voters will face a complex ballot with multiple significant issues.
Previous attempts to expand online betting have repeatedly failed in the state legislature. One lawmaker even equated sports betting with murder and theft in past debates, illustrating the strong moral opposition some representatives hold toward the gambling industry.
This history of legislative failures makes the current Senate approval particularly significant, suggesting a potential shift in political attitudes or increased pressure from voters who desire legal access to mobile betting.
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