Professional esports audiences and tournament prizes are growing globally, as are the associated markets for online betting. In Japan, however, many forms of wagering remain illegal or heavily regulated. Players can legally place bets online, but mostly on websites based in other countries or on selected sports such as motor racing or sumo wrestling. There are now signs that upcoming regulatory changes could open betting markets for a wider range of sports such as esports. Also, whilst amateur gaming is highly popular in Japan, the growth of the competitive side has been restricted by the government for the last century. This, too, is slowly evolving with informal consultations of business representatives with regulators.
An increasing number of regions are legalizing online wagering due to its revenue potential. In Japan, too, taxes on gambling could be a new source of tax revenue for the government. The subject remains a sensitive one given betting’s links to criminal organizations.
Nevertheless, the pandemic has amplified two demand-side factors driving legalization: Firstly, the interest from younger generations in esports and online betting is growing. Secondly, the adoption rate of sports betting apps from older generations has also steadily increased. It remains uncertain whether operating esports betting businesses will be legalized in the short-term, but the growing market potential is changing its odds.
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