Novig has announced that it has secured a license to operate in Colorado after being given approval by the Colorado Division of Gaming.
Colorado marks the first state in which Novig will launch. The sports betting exchange operator has established market access through a partnership with Full House Resorts, and the Bronco Billy’s casino in Cripple Creek.
Novig models itself on a “no vigorous” model. Vigorous is the term used for a cut or amount charged by a bookmaker for accepting a bettor’s wager. Novig is a commission-free, high frequency sports betting exchange.
The company is unable to launch with an exchange product as the legislation has not yet been passed by the Colorado Limited Gaming Control Commission and as such it will initially launch with a traditional sportsbook. Novig will become the 23rd online sports betting operator.
The Colorado Limited Gaming Control Commission voted 3-1 in a monthly meeting to delay the official legalization of sports betting exchanges. The primary concern for the regulator concerns the taxation, and net benefit to the state.
Given the commission-free model, the regulators’ concern is that given the percentage model, GGR is likely to be lower and thus the tax treatment needs to be different. The additional concern is that an exchange will cannibalize traditional sportsbook revenue and therefore pose an overall net negative to Colorado.
Co-Founder and CEO of Novig Jacob Fortinsky commented: “We’re thrilled to kick off our journey in the vibrant sports betting landscape of Colorado, and we’d like to thank the Division of Gaming for their help throughout the process. We’re committed to building an unparalleled, community-led betting experience, and we look forward to becoming the go-to destination for sports fanatics and sharp bettors alike.”
Currently, sports betting exchanges are only operational in New Jersey. Sporttrade launched its Colorado mobile sports betting application in late August with just a sportsbook. In New Jersey, the company takes a 2% cut when users match on the exchange.