Nevada Rejects Proposed PropSwap Sports Betting Ticket Exchange
The Nevada Gaming Control Board turned down the proposed PropSwap sports betting ticket exchange. The NGCB is unwilling to permit sports betting companies to exchange sports bets. In addition, the state already banned PropSwap in 2021 because it operated without a gaming license.
PropSwap proposed a novel concept in the state’s authorized sports betting business-a new category of service providers, betting ticket resale providers. This was presented as Regulation 5.240, a potential game-changer in the industry. The certification would have allowed the holder to operate a virtual sports betting ticket exchange without a standard gaming license, a unique and innovative approach.
According to sportsbook pay per head reviews and news sites, the NGCB rejected the proposal on Thursday. The board cited several issues with the proposal.
Proposed PropSwap Sports Betting Ticket Exchange
Kirk Hendrick, chair of the committee, raised doubts about the potential interest in such trades in Nevada. Some members were worried about the possibility of money laundering, while others highlighted the challenges of implementing player protection and know-your-customer policies.
According to pay per head bookie experts, the Nevada legislature failed to advance a bill to legalize the business. However, PropSwap hopes for a fresh chance in 2025. Hendrick stated that the matter may be addressed later, but he did not see any logic in adopting it at this time.
Users of the PropSwap platform can engage in what amounts to a decentralized form of a wager cash-out by selling their unpaid tickets to other users. A secondary market for legal sports tickets supplied by sportsbooks is essentially what it provides. Due to the more significant possible gains, the seller receives a guaranteed payout, and the buyer gets to bet what they wish.
Two of PropSwap’s main sources of revenue are a 3% charge on all account deposits and a 10% commission on the sale price. Marc Rubinstein, an attorney for PropSwap, informed the NGCB that his client was prepared to pay a gross gaming revenue tax on the commissions it assessed.
Although it expanded to over 20 states in 2022, PropSwap was forced to leave Nevada the same year. The fact that PropSwap does not generate any new bets on its platform has led some of its markets to deny it a sports wagering license, while others maintain that it does not qualify as a betting company.
Almost three years after PropSwap stopped operations in Nevada, the NGCB finally ended the drawn-out hearing with its rejection. The case ultimately ended up at Thursday’s meeting after being rejected by the district court in February 2022, appealed to the Nevada Supreme Court, referred to the court’s settlement program, and continued through the appeals process.
Colorado Had Similar Concerns
Last year, a comparable incident occurred in Colorado, and now Nevada is following suit. In June 2023, the Colorado Limited Gaming Control Commission voted down new regulations that would have allowed sports betting exchanges in Colorado. According to a political news forum, only the winning wager commissions would have been subject to taxation in the Centennial State.
However, Colorado’s commission brought up tax collection and overall consequences. Ultimately, the state followed New Jersey’s lead and passed legislation to legalize and regulate exchange betting in the United States later that summer.
In addition to becoming online in Colorado last August, Prophet Exchange and Sporttrade are the two licensed exchange companies in New Jersey that provide peer-to-peer betting. But this week, Prophet Exchange co-founder Jake Benzaquen announced that the company will stop doing business in the Garden State as of May 28.
