This Is the First State to Legalize Daily Fantasy Sports

March 8, 2016, 3:13 PM UTC
DraftKings Inc. And FanDuel Inc. Applications As Ad Spending Increases
The DraftKings Inc. app and FanDuel Inc. website are arranged for a photograph in Washington, D.C., U.S., on Monday, Oct. 5, 2015. Fantasy sports companies DraftKings Inc. and FanDuel Inc. raised a total of $575 million in July from investors including KKR & Co., 21st Century Fox Inc. and Major League Baseball to attract players to games that pay out millions of dollars in cash prizes in daily contests. Photographer: Andrew Harrer/Bloomberg via Getty Images
Photograph by Andrew Harrer—Bloomberg via Getty Images

Virginia officially legalized daily fantasy sports, like those run by DraftKings and FanDuel, by signing into law the “Fantasy Contests Act” Monday. The new law is the nation’s first formal approval of the industry after its come under scrutiny across many states for allowing what regulators see as illegal online gambling.

Virginia Governor Terry McAuliffe signed the act officially on Tuesday, enacting the bill that was initially approved by state legislators in February. Daily fantasy sports sites will now be overseen by the state’s Department of Agriculture and Consumer Service, reported the Verge.

Daily fantasy sports, where players draft a roster of football players to compete for points in a single-day worth of games, were acknowledged by Virginia lawmakers as a game of skill vs. pure chance, a key difference that allows sites to avoid a federal ban on online gambling. The new laws set up a series of policies to protect consumers, including two independent audits every year, a $50,000 fee to operate in the state, and ensuring that all players are over 18 years old.

Both FanDuel and DraftKings were pleased with the news. DraftKings said it “will continue to work actively to replicate this success with dozens of legislatures.” Cory Fox, a lawyer for FanDuel, commended Governor McAuliffe’s leadership and he hopes “to see more states follow Virginia’s lead in the months ahead.”


Daily fantasy sports are currently banned altogether in many states, including Texas, Arizona, Iowa, Louisiana, Montana, and Washington. Attorney generals in New York and Illinois have also said the online games are illegal, but the rulings are being challenged.