Arkansas Approves DraftKings, FanDuel Sportsbooks Launch

The Arkansas Racing Commission has greenlit DraftKings and FanDuel to operate sportsbooks in the state, clearing the way for both platforms to launch ahead of March Madness. The approvals mark a significant expansion for two of America’s largest sports betting operators into a market that has underperformed relative to comparable states.

What Happened

DraftKings and FanDuel each received operational licenses from the Arkansas Racing Commission (ARC), ending months of regulatory negotiation in a state that legalized sports betting in 2018 but has seen limited operator participation.

DraftKings will operate through a partnership with Southland Casino Hotel in West Memphis. FanDuel secured approval via Oaklawn Racing Casino Resort in Hot Springs. Both companies plan to launch their platforms in time for the NCAA Division I Men’s Basketball Tournament, which begins in March.

The approvals represent a reversal from both operators’ previous positions. In 2022, DraftKings and FanDuel both cited Arkansas’s 51% revenue retention mandate for host casinos as economically unworkable. The requirement forced operators to surrender more than half their gross sports betting revenue to casino partners, a structure neither company found acceptable at the time.

The exact terms of the current agreements have not been disclosed publicly, but both operators evidently found a path forward with their respective casino partners that satisfies their financial requirements.

Why It Matters For Players

For Arkansas bettors, this means access to two major sportsbooks with substantial liquidity, competitive odds, and established mobile platforms. DraftKings and FanDuel both operate in dozens of states and maintain sophisticated risk management systems and customer protections.

The March Madness timing is strategic. College basketball’s tournament is the single largest sports betting event of the year in the United States. Players in Arkansas will now have access to the same platforms available to bettors in New York, New Jersey, Illinois, and other major markets during the tournament.

Existing players in Arkansas had limited options. Only BetMGM and Caesars Sportsbook currently operate in the state, both through partnerships with Hot Springs casinos. The addition of DraftKings and FanDuel increases competition and gives bettors more choice in promotional offers, user interface design, and betting markets.

Market Context And Trend Analysis

Arkansas sports betting has underperformed expectations since launch. Last year, the state generated $59.7 million in gross sports betting revenue. By comparison, Kansas—a state of similar population—produced $292.2 million in gross revenue during the same period. The gap reflects both Arkansas’s restrictive regulatory structure and limited operator participation.

The 51% revenue retention mandate that initially blocked DraftKings and FanDuel was designed to benefit host casinos. In practice, it created a barrier to entry that deterred major operators. Most states with successful sportsbooks operate with revenue sharing arrangements between 20% and 35%, giving operators sufficient margin to invest in customer acquisition and technology.

Arkansas’s regulatory environment has gradually loosened. The state now permits both retail and mobile sports betting. The ARC has shown willingness to negotiate with major operators rather than rigidly enforce the original revenue split. This pragmatism mirrors trends in other states that initially set unrealistic operator requirements and later adjusted them to attract competitive markets.

The DraftKings and FanDuel approvals suggest Arkansas regulators understand that operator competition drives tax revenue. A state with four active sportsbooks generates more total handle and tax revenue than one with two, even if individual operators retain lower margins. This represents a maturation in state-level sports betting policy.

The Crypto Casino and Gambling Angle

For the crypto gambling community, Arkansas’s evolution matters because it reflects broader regulatory trends affecting digital gaming markets. Traditional sportsbooks like DraftKings and FanDuel operate under state licensing frameworks that require significant compliance infrastructure, banking relationships, and regulatory oversight.

Crypto-native gambling platforms operate in a different regulatory universe. While traditional sportsbooks must negotiate with state racing commissions and casino operators, crypto casinos leverage blockchain infrastructure and decentralized finance protocols to bypass many traditional gatekeepers.

Arkansas’s gradual opening to major operators demonstrates that states eventually move toward competitive markets when initial restrictions prove economically counterproductive. The same logic applies to crypto gambling. As blockchain technology matures and regulatory frameworks develop, states face pressure to either accommodate digital gambling platforms or watch their residents use offshore alternatives.

The partnership model—where DraftKings and FanDuel operate through established casinos—also reflects a hybrid approach gaining traction in regulated markets. Crypto platforms may follow a similar path, partnering with traditional financial institutions or licensed gaming operators to bridge the gap between decentralized technology and state-level compliance requirements.

Key Takeaways

• Arkansas Racing Commission approved DraftKings and FanDuel to operate sportsbooks, ending regulatory deadlock that lasted several years.
• Both operators plan March Madness launches through partnerships with Southland Casino Hotel and Oaklawn Racing Casino Resort respectively.
• The approvals reverse previous rejections based on Arkansas’s 51% revenue retention mandate, suggesting negotiated terms more favorable to operators.
• Arkansas sports betting generated $59.7 million in gross revenue last year, significantly below comparable markets like Kansas ($292.2 million).
• Increased operator competition in Arkansas may drive higher total handle and tax revenue despite lower per-operator margins.
• The approvals reflect a broader trend of states adjusting initial sports betting restrictions to attract major operators and maximize tax revenue.

Frequently Asked Questions

The Bottom Line

Arkansas has finally cracked open its sportsbook market to the two largest operators in American sports betting. After years of regulatory standoff, DraftKings and FanDuel found acceptable terms with casino partners and secured ARC approval. The timing for March Madness is no accident—both companies understand that college basketball’s tournament drives the highest betting volume of the year.

For Arkansas, the approvals represent a shift toward competitive markets. The state’s previous revenue retention requirements were designed to protect casinos but instead protected a status quo of limited options and underperformance. With four active sportsbooks now operating, Arkansas should see increased betting handle and higher tax revenue, even if individual operators work with tighter margins.

The broader lesson extends beyond Arkansas. States that set unrealistic operator requirements eventually adjust them. The same pattern will likely repeat in crypto gambling as blockchain technology matures and regulatory frameworks develop. Markets that remain rigidly restrictive lose tax revenue and push bettors toward offshore alternatives. Those that embrace competition win.