iGaming Weekly Recap (June 30–July 6, 2025): DFS Deemed Illegal in California by AG Opinion

The debate surrounding the One Big Beautiful Bill (OBBB), signed by Donald Trump on July 4, centers on new tax regulations limiting deductions for gambling losses. Currently, players can deduct 100% of losses from winnings, provided losses don’t exceed gains. However, OBBB caps deductions at 90%, meaning even players breaking even will owe taxes on a portion of their “profits.” For example, a player winning $100,000 and losing $100,000 will owe taxes on $10,000.

California Attorney General Rob Bonta issued a legal opinion deeming Daily Fantasy Sports (DFS) illegal under state law. The 33-page ruling, based on Penal Code Section 337a, classifies DFS as sports betting. Bonta argues that both “pick’em” games (where players bet on individual athletes’ performances) and draft-style games (where players build teams) violate the state’s ban on wagering on sports outcomes. He asserts that players aren’t competing in the games themselves but betting on others’ results.

Underdog Fantasy filed a lawsuit in Sacramento Superior Court to block the opinion, but their request for a temporary injunction was denied, as the AG’s opinion is advisory and lacks legal force. The Indian Gaming Association and Tribal Alliance of Sovereign Indian Nations support the ruling, viewing DFS as “illegal and unregulated gambling” that undermines their regulated casino ventures. The Coalition for Fantasy Sports opposes it, claiming 75% of California voters support DFS. Governor Gavin Newsom distanced himself from Bonta’s opinion, calling it misguided and urging a solution to allow DFS to continue.

The crackdown on sweepstakes continues. Louisiana Attorney General Liz Murrill issued an opinion classifying these platforms as illegal gambling. She argues that sites enabling the purchase of virtual “Gold Coins” and receiving “Sweepstakes Coins” for cash or prize games are “persistent, predatory, and profit-driven,” unlike legal promotional lotteries. Murrill notes these platforms lack state licenses, age verification, or “know your customer” (KYC) checks, violating Louisiana’s ban on unregulated online gambling.

In response to new Illinois tax regulations, Fanatics Sportsbook, like FanDuel and DraftKings, will introduce a per-bet surcharge.

Illinois implemented a new betting tax of $0.25 per bet for the first 20 million bets annually, then $0.50 per bet thereafter, combined with a progressive tax rate of 20% to 40% (changed last year from a flat 15%). This results in effective tax rates of 57% to 60% for the largest operators, the highest in the U.S.

Fanatics, unlikely to hit the 20 million bet threshold, will charge a $0.25 per-bet fee starting this fall, while larger competitors FanDuel and DraftKings will charge $0.50 starting September 1, 2025, expecting to exceed the threshold.

Intralot S.A. and Bally’s Corporation announced a €2.7 billion deal, with Intralot acquiring Bally’s International Interactive Business. The transaction is set to close in Q4 2025. Intralot will pay Bally’s €1.53 billion in cash and issue 873,707,073 new shares valued at €1.30 each, totaling €1.136 billion for Bally’s online casino and gaming operations. To fund the cash portion and refinance existing debt, Intralot secured €1.6 billion in credit commitments from Citizens Bank, Deutsche Bank, Goldman Sachs, and Jefferies, while planning a €400 million equity offering on the Athens Stock Exchange.

Upon closing, Bally’s, already Intralot’s largest shareholder (33.34%), will become the majority shareholder. The deal aims to strategically position Intralot as a powerhouse in lotteries and iGaming, combining Intralot’s LotosX and PlayerX systems with Bally’s Vitruvian data analytics platform.