The Current State Of The Japanese Sports Betting Market
In recent years, the sports betting market has seen rapid expansion, particularly in the USA and Europe.
While the number of online casinos and bookmakers handling sports betting has increased overseas, what is the current state of the sports betting market in Japan?
First, we will explain the market size and legal framework for sports betting in Japan, as well as the differences between the sports betting markets in Japan and other countries.
Current market size and legal framework
As sports betting itself is currently illegal in Japan, it is impossible to calculate the size of the sports betting market itself.
However, the market size of the sports industry itself in Japan is very large and, according to the Sports Agency, was approximately 5.5 trillion yen in 2012 and is gradually growing to 10.9 trillion yen in 2020.
The sports market is also expected to be worth JPY 15.2 trillion by 2025, so there is no doubt that it is a market with great potential for expansion in the future.
Currently, sports betting is not implemented in Japan due to legal restrictions, but if it were to be introduced, the sports market itself would expand further.
In Japan, betting money on events that do not fall under the category of public gambling is considered a gambling offence, and sports betting itself is currently illegal.
In fact, there have been cases where people from Japan who have used overseas online casinos have been arrested and convicted.
Therefore, even sports betting, which is common overseas, is subject to punishment when betting money from within Japan.
Differences between the Japanese market and other countries
The following table summarises the four main differences between the Japanese market and other countries in sports betting.
In Japan, only legal public gambling and sports lotteries are eligible for sports betting.
Firstly, the sports covered by sports betting in Japan are very different from those in other countries.
In other countries, sports betting covers a wide range of sports, including public gambling, major sports such as baseball, football and basketball, as well as e-sports.
The types of odds available are also more varied in sports betting in other countries.
Compared to Japanese sports betting, which predicts the winners and losers of games such as the placing of horses and boats, sports betting in other countries offers a variety of betting options such as points and scorers.
The way odds are set also differs greatly between Japan and other countries.
Public gambling and sports lotteries in Japan are run by the national and local governments, and are therefore assumed from the outset to secure operating costs.
Therefore, the odds are set after securing a profit in advance from the overall betting amount.
The amount of money returned to the user and the overall rate of return are reduced because the profit is deducted in advance.
On the other hand, as online casinos and bookmakers set their own odds, sports betting tends to have a higher rate of return compared to Japanese sports betting.
Online casinos and bookmakers do not have physical shops, so their operating costs, including labour costs, are kept low, which is also thought to lead to Higher Return Rates.
Japanese Attitudes Towards Sports Betting
Next, we will discuss Japanese attitudes towards sports betting in more detail, referring to public gambling and overseas sports betting sites.
Comparison with traditional betting cultures (horse racing, bicycle racing, etc.)
Japanese people’s awareness of sports betting is thought to have a strong image of it being ‘illegal’ and ‘gambling that thrives overseas’.
In Japan, horse racing and bicycle racing are recognised by many people as public gambling, as the government launches commercials and advertisements.
However, sports betting is a word that is not often heard in Japan.
In some cases, you may see the words ‘baseball betting’ in the news in Japan, so it is thought that many people recognise that betting money on sports is equal to gambling.
Use of overseas sports betting sites
Some Japanese may be aware of the existence of overseas sports betting sites.
In fact, it is possible to access and use foreign sports betting sites from Japan.
However, connecting to a foreign sports betting site from within Japan and spending money on it constitutes gambling and is therefore a crime.
As the majority of online casinos are legally operated by overseas operators, many people believe that it is safe for personal use.
However, it is important to note that even licensed and legally operated overseas sports betting sites are illegal when used.
There have been cases in the past where online casino users have been arrested for gambling offences.
It is important to note that a fine or fine of up to ¥500,000 can be imposed for gambling offences, and imprisonment of up to three years for habitual gambling offences.
Possibility And Impact Of Future Deregulation
This section explains the possibility of future deregulation in Japan and the impact if casinos, including sports betting, become legal.
Discussions towards deregulation are still underway, but even if casinos are legalised through legal reform, issues related to 800-machine and illegal gaming will still need to be considered.
Discussions on deregulation
The current active movement to legalise sports betting around the world has led to discussions on the introduction of sports betting in Japan as well.
However, as Article 185 of the Criminal Code in Japan clearly states that gambling is prohibited, sports betting cannot currently be implemented in Japan.
In order to legalise sports betting in Japan, the law would need to be deregulated.
Currently, there is active debate in Japan on the Casino Bill, so there are high expectations for a possible future amendment of the law to allow or disallow sports betting.
Expectations and challenges for the casino industry
Discussions regarding the Casino Bill are currently active in Japan, and there are high expectations for the casino industry in the future.
If casinos are legalised in Japan, there are high expectations for the distribution of the economy not only by domestic users but also by visitors travelling from abroad.
In addition, the current size of the sports market in Japan is expected to be approximately 15.2 trillion yen by 2025, so there is potential for further market expansion with the lifting of the sports betting ban.
However, if casinos, including sports betting, are legalised in Japan, the most important issue that needs to be addressed is the fairness of gambling.
In Japan today, the issue of eight-figure betting in horse racing, boat racing and other forms of public gambling is often raised as a hot topic.
For example, horse racing jockeys and boat racers may collude to manipulate the placing of certain horses or boats, or to develop a race so that the most popular horse or boat does not come in first.
When the issue of betting on race betting becomes public knowledge, many users leave gambling because they feel that they will lose even if they bet anyway, or that they will not bet if there is betting on race betting.
Therefore, it is essential for the casino industry, including sports betting, to work towards maintaining fairness.
Currently, online casinos and bookmakers commonly operating abroad cannot legally operate without a licence issued by a country or government.
Furthermore, even after obtaining a licence, online casinos and bookmakers are subject to regular audits to ensure that there are no irregularities.
If casinos are to be legalised in Japan, efforts will need to be made to reassure users by proving that the games are free from any 800 game problems or irregularities.
Therefore, it will be necessary to require licensing and mandatory audits, such as those adopted by overseas online casinos.
Changes Brought To The Market By Technological Evolution
The evolution of technology is also bringing significant changes to the casino market.
In particular, the proliferation of mobile apps, virtual currencies and the rise of blockchain have boosted the online casino industry.
Technology around the world, which is growing at an impressive rate every day, will have a significant impact on the casino industry in the future.
Proliferation of mobile apps
In recent years, the general use of smartphones worldwide has also spurred the proliferation of mobile apps.
In some cases, online casinos and bookmakers offering sports betting are also developing and offering their own mobile apps.
The convenience of mobile apps, which allow users to enjoy betting anytime, anywhere and at any time, has had no small impact on the expansion of the casino market.
The fact that smartphones are expected to continue to be commonly used in the future also means that the provision of mobile apps for gambling, including casinos, is likely to increase.
Rise of virtual currencies and blockchain
The increasing popularity of virtual currencies and blockchain is also likely to have an impact on the casino market.
In recent years, virtual currencies such as Bitcoin and Ethereum have become prominent and their use is on the rise.
An increasing number of online casinos and bookmakers that offer sports betting also support or specialise in virtual currencies.
Online casinos offer a variety of payment methods, and one of the advantages of virtual currency is that deposits and withdrawals take less time.
In recent years, a system known as blockchain has also attracted attention in the casino industry.
Blockchain refers to a mechanism that makes it difficult to cheat or tamper with transactions. In other words, it is a mechanism that allows more normal transactions to be maintained.
The introduction of blockchain adds security to transactions, and an increasing number of online casinos have introduced it in recent years.
Many people are concerned about security when using online casinos, as they need to register their personal details, as well as their account information when depositing and withdrawing cash.
Online casinos are also actively introducing highly secure virtual currencies and blockchains as a way of attracting new users.
Therefore, it can be expected that the number of online casinos and bookmakers that support virtual currency and blockchain will continue to increase.
Conclusion
Although sports betting itself is illegal in Japan, the market size of the sports industry itself in Japan is very large and there are high expectations for future expansion.
Therefore, if sports betting were to be introduced, there are high expectations for further expansion of the sports market.
Discussions are currently underway in Japan to deregulate the casino market, but if casinos were to be legalised, it would be necessary to consider issues related to illegal games and illegal gambling.
There will be a need to require the acquisition of licences like those used by overseas online casinos and to make audits mandatory.
In addition, the recent proliferation of mobile apps and the rise of virtual currencies and blockchain have boosted the online casino industry.
As security is a key factor in attracting new users, we can expect to see more and more secure virtual currency and blockchain-enabled services in the future.
