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June 5, 2024
Balancing Innovation and Regulation — 5 Thoughts from Eric Frank, President of IC360, on the Evolving Sports Betting Landscape
This week, I had the pleasure of sitting down with Eric Frank, President at IC360 and a leading expert in the world of compliance. He's currently a Special Advisor on U.S. Regulatory Affairs at Genius Sports and sits on the advisory board at BettorFantasy, but that's not all. Eric was the CEO & Founder of Odds on Compliance before IC360 was formed upon a merger with US Integrity earlier this year. Before that, he served as the Vice President of Legal Affairs & Group Compliance Officer for The Stars Group. With a resume like that, it's safe to say Eric is one of the world’s sharpest minds when it comes to navigating complex gaming regulations.
Throughout our conversation, we dug into the constant push and pull between innovation and regulation and how companies are getting creative to stay ahead. Eric didn't hold back, giving us the inside scoop on how IC360 is shaking things up with their new partnership and the emerging trends that are keeping regulators on their toes. But through it all, one thing was clear - finding the right balance between protecting consumers and leaving room for growth is no easy task. If you're looking to stay ahead of the curve in the sports betting game, this is one episode you won't want to miss.
Make sure to catch the full episode with Eric Frank here:
But for now, enjoy some of my favorite bits from my conversation with Eric:
1. IC360 aims to own the RegTech space for compliance and integrity in sports betting globally
Eric broke down the recent merger of his company Odds On Compliance with US Integrity to form IC360. And let's say, they're not thinking small:
"The plan there is to kind of own the RegTech space for compliance and integrity in the sports betting industry, not just in the US, but also globally across Europe, Latin America and beyond."
IC360 is gearing up to be the go-to provider of all things compliance and integrity for sports betting, no matter where in the world you are. By joining forces, they're ready to tackle the complex challenges operators face in an industry that's becoming more connected and regulated by the day.
2. Finding the right balance with regulations is an ongoing challenge as the industry matures
As sports betting continues to grow, finding that sweet spot between necessary regulations and room for innovation is still a work in progress. Eric gave it to us straight:
"I think there is a balance. And do I think we found it yet? Absolutely not."
While regulations are crucial for protecting consumers and keeping things on the up and up, they can also make it tough for new players to enter the game. As the industry matures, it'll take some trial and error to find the perfect balance that allows for responsible growth and innovation.
3. The fast pace of technological innovation often outpaces the speed of regulation
In the world of sports betting (and everywhere else for that matter), technology moves at a mile a minute. And sometimes, regulators struggle to keep up. Eric hit the nail on the head:
"Technology today is moving at a pace that is outpacing regulation - it always has. So you're always going to have companies on the cutting edge and building new technology that may or may not fit in a perfect box that comes out of legislation and regulation.”
This push and pull between cutting-edge products and the laws meant to govern them creates some tricky situations. Companies looking to push boundaries will need to do so responsibly, at times holding themselves to high standards even when the regulations aren't exactly clear.
4. IC360's partnership with Radar aims to bring more affordable and insightful geolocation solutions to the industry
Geolocation is a must-have for compliance in sports betting, but the current solutions can be a bit pricey. IC360's new partnership with Radar is looking to shake things up:
"What Radar is looking to offer is a new way of both calculating what geolocation services should cost and how the metrics should be measured."
By teaming up Radar's innovative tech with IC360's industry know-how, this partnership could be a game-changer. With more affordable and feature-packed geolocation options, operators could see one of the biggest barriers to entry and growth come crumbling down.
5. The rise of "DFS Plus" and sweepstakes betting is creating new gray areas that will likely face increased scrutiny
As operators look to expand their reach, "DFS Plus" and sweepstakes betting have become popular, but they're in a bit of a legal gray zone. Eric warned that this trend could put regulators on high alert:
"I think we're going to, unfortunately, see that those bad actors will be pulling down the good actors. It's just the nature of what's going to happen."
Similar to issues arising from technological innovation, companies diving into these new territories will need to hold themselves to high standards of consumer protection and integrity, even without clear rules to follow. If they don't, it could lead to crackdowns that affect everyone in the industry. Being proactive and self-regulating will be key to growing these new verticals responsibly without stirring the pot too much.
Questions?
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It can be collected for free as a bonus with purchases of Novig Coins or via one of our alternative methods of entry. No purchase is necessary to obtain Novig Cash. Please see our Sweepstakes Rules for complete details.
If you win Novig Cash by participating in sweepstakes games, you may redeem the Novig Cash for real cash prizes, subject to minimum and maximum redemption limits, but you must verify your eligibility and comply with all requirements, in accordance with our Terms of Use. The current minimum redemption of Novig Cash is $20, and the current maximum redemption of Novig Cash is $5,000 for a single redemption and $10,000 per day, except in New York and Florida where the maximum daily redemption is $5,000.
Sweepstakes are promotional games with prizes for the winners. They are used to promote the sale of products — in our case, Novig Coins — and have been legitimately used by businesses in the United States for decades.
Unlike traditional sports betting where you wager real money on sports outcomes, sweepstakes involve no real money gambling. A sweepstakes is a game of chance where participants can win prizes without any requirement to make a purchase. Participants use Novig Cash to play sweepstakes games for the chance to win prizes.
We are the platform where winners play. Our research indicates that players are over 10x more likely to win on Novig compared to our competitors. On other platforms, if you are consistently winning, you are likely going to get limited or frozen out entirely. At Novig, winners are welcome.
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We offer moneyline, spread, totals, and player prop markets in NFL, NBA, NHL, MLB, NCAAF, NCAAB, NCAAW, and WNBA. In the coming months, we will expand our offerings to include other sports (tennis, UFC, golf, soccer) parlays, SGPs, and other exotic markets.
Yes! Novig was founded by Jacob Fortinsky and Kelechi Ukah and has raised $7M from over 30 leading venture capital firms and angel investors including Joe Montana, Y Combinator, Lux Capital, Paul Graham, and founders of companies like Dropbox and Instacart. You can read more in Forbes.
Additionally, Novig is partnered with trusted, industry-leading payments gateways to allow for the secure and trusted redemption of Novig Cash, and we work with industry-leading counsel to ensure our full compliance with applicable laws and regulations.
On Novig, you don’t have to just take the odds that the market is offering. You can set your own.
For example, let’s say you want to put 1000 Novig Coins on the Cowboys to win against the 49ers and you see that the best odds are currently -330 for 49ers and +240 for the Cowboys. Instead of just taking the Cowboys at +240, you can change your Order type to Make on the Order Slip, and enter in whatever odds you’d like, say +300.
Those odds are then offered to the rest of the Novig community so the 49ers odds would update to -300 and when another player on the app takes the other side, you will be notified that your order is filled and your payout would be 4000 Novig Coins, instead of 3400. If your order remains unmatched, it will be canceled automatically when the game starts, or you can cancel it from the Portfolio screen at any time and the Coins will be returned to your wallet.
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It's a great question and one that gets to the heart of how we're different from traditional sportsbooks. Our revenue model is actually quite simple. We make money in two ways.
First, we act as a market maker on our own platform. That means in addition to letting users trade directly against each other, we're also providing liquidity and acting as a participant in the market. This helps keep markets active even when user liquidity is low and solves the “cold start problem” from day one.
In other words, if you want to participate in a niche market where there isn’t any counterparty, we will serve as the counterparty. In the most liquid markets — like NFL moneyline markets — we expect the vast majority of trades to be directly peer-to-peer where we don’t take a cut, but in less liquid markets, we expect most trades will be against Novig, where we will have 1-4% spreads.
Second, for our highest volume users - think professionals and hedge funds - we have a fee structure. But for the vast majority of users, we're not taking a cut at all. When two users play against each other, we're not touching the winnings. That means if you put up 100 Novig Cash and your buddy puts up 150 Novig Cash, the winner gets 250 Novig Cash, whereas on virtually any other platform the house would take 8-10% of the winnings, so you’d only get 230.
This is a complete paradigm shift in the industry. We're the only platform in the world that doesn't take a cut from most of our users' winnings. It's a game changer, and it's at the core of our mission to build the fairest, most transparent platform possible.
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