Nevada regulators ruled on Thursday that playing daily fantasy sports should be considered gambling, not a game of skill, and ordered websites like DraftKings and FanDuel to stop operating immediately in the state until the companies and their employees receive state gambling licenses.
It is perhaps the most significant setback yet for a booming, unregulated industry that has spent the past two weeks in the midst of allegations that have prompted federal and state investigations into whether its employees, armed with inside information, exploited paying customers.
2015 DraftKings and FanDuel, each valued at more than $1 billion, have operated under an exemption to the Unlawful Internet Gambling Enforcement Act of 2006, which outlawed online poker and sports betting. Five states have prohibited them from operating, but none are as powerful and influential as Nevada, which has long been a bastion of legal gambling, operates under strict regulation, and has the nation’s only active sports betting.
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