New York (WRGB) — New York’s mobile sports betting boom is pouring billions into state coffers, but it is also fueling a troubling rise in problem gambling, a trend state officials warn could worsen as prediction markets expand and become easier for younger users to access.

Mobile sports betting has quickly become New York’s second-largest source of gaming revenue, behind only the lottery. In State Fiscal Year 2026, mobile sports betting generated $1.3 billion in state revenues from taxes on gross gaming revenues, according to a report released today by State Comptroller Thomas P. DiNapoli.

DiNapoli said,

While the legalization of mobile sports betting in New York has boosted state revenues, the rise in problem gambling, particularly among young people, is a major concern. The rapid proliferation of the prediction markets, which generate significant revenue based on sports activities, only makes it easier to get hooked on these online platforms. I was encouraged by the state’s decision to double funding for problem gambling services from $6 million to $12 million, but this is a drop in the bucket compared to the billions being wagered. We need to do much more to identify how mobile sports betting is impacting New Yorkers and ensure consumers are protected.

The report outlines six different forms of statutorily authorized gaming in New York: horse racing, the lottery, video lottery terminals, casinos (commercial and tribal), sports betting (mobile and in-person), and interactive fantasy sports. In SFY 2026, the state collected more than $5.1 billion in gaming revenues, $1.3 billion, or 33%, higher than in SFY 2016. But excluding mobile sports wagering, gaming revenues from all other forms declined by 0.8%.

The lottery remains the state’s largest source of gaming revenue, with average annual growth of 1.8% from SFY 2010 to SFY 2023. However, lottery revenues were nearly 10% lower in SFY 2026 than peak collections in SFY 2023. Through July of SFY 2027, lottery revenues were up only 0.6%, or $4.4 million, from the same period last year.

Mobile sports wagering revenue has increased. Collections from the tax on gross gaming revenue increased 78.4% between SFY 2023 ($727.4 million) and SFY 2026 ($1.3 billion). Since implementation in January 2022 through the end of SFY 2026, more than $91.2 billion in mobile sports bets have been placed in New York, generating gross gaming revenue of $8.3 billion.

A recent joint report from the New York State Gaming Commission and the Office of Addiction Services and Supports found there were 7.2 million unique mobile sports wagering accounts in New York in 2025. The average amount wagered per account that year was $3,500, with an average amount per wager of $42. In 2025, five sports accounted for more than 90% of all mobile sports wagers, and basketball led all sports with more than $9 billion in wagers.

Betting volume and tax receipts fluctuate during the year, driven in part by major sporting events. The report notes activity rises from October to March due to the World Series, the Super Bowl and the NCAA’s “March Madness” basketball tournament.

In June 2026, betting activity across all authorized mobile sports wagering platforms increased by more than $604 million (36.6%) year-over-year, but gross gaming revenues decreased nearly $90 million (43.5%). The report attributes those results in part to the New York Knicks, described as underdogs with high sportsbook odds, winning the 2026 NBA Championship. During the first two weeks in June, more than $1 billion in mobile sports bets were made, but gross gaming revenues reflected a net loss of $14.4 million because payouts on winning wagers exceeded wagers received.

The report also highlights a spike tied to the World Cup. During the World Cup, June 11 to July 19, 2026, excluding the NBA Finals week, gamblers placed $2.5 billion in bets – $775.5 million (45.7%) more than the same period in 2025.

Beyond traditional sportsbooks, the comptroller’s report raises alarms about prediction markets such as Kalshi and Polymarket, financial platforms where users can place bets on the outcome of real-world events, including sports. Since sporting events were added, global trading on these platforms increased significantly, reaching $24 billion and $27.1 billion in 2025 for Kalshi and Polymarket, respectively. Through July, total trading volume for both was $208.6 billion. The majority of global trading volume on both platforms is related to sporting events – 79.8% on Kalshi and 51.2% on Polymarket.

New York has already taken enforcement steps. In October 2025, the New York State Gaming Commission sent a cease-and-desist letter to Kalshi for “illegally operating, advertising, promoting, administering, managing, or otherwise making available an unlicensed mobile sports wagering platform in New York state in connection with any sports event.” On July 31, the governor and attorney general announced that New York has sued Kalshi for running an illegal gambling operation in the state and to order Kalshi to forfeit all alleged illegal gains. A coalition of 44 state attorneys general, including New York, also sent a letter stating that the Commodity Futures Trading Commission lacks authority to regulate sports-related event contracts.

Problem gambling remains a significant concern, the report states. According to the recent report from the Gaming Commission and OASAS, there were 2,545 calls to the state’s HOPEline, up 8.5% from 2020.

The comptroller’s report warns the proliferation of prediction markets could exacerbate problem gambling because they are available to participants younger (age 18) than those allowed for mobile sports wagering (age 21) and are subject to fewer advertising restrictions.

If you or someone you know has a gambling problem you can call 1-877-8HOPENY.