As I discussed previously, Daily Fantasy Sports (DFS) is sports gambling made into an efficient commodity. They pretend they’re not, as does the NFL, but they are.

Today the Nevada Gaming Control Board, the state’s gambling regulator, announced that all DFS sites must be licensed in order to operate in the state. In response, all the major DFS sites pulled out of the Nevada market.

I said from the start that what DFS bettors need isn’t regulation, but rather prosecution of cheaters. New York had the right idea, with its Attorney General opening an investigation. Nevada is instead attempting the regulatory approach, and it’s already completely failing.

No justice will be coming for the victims of Draft Kings by this. The site responded by pulling out of the Nevada market, instead of submitting to regulation. Regulation is already a complete failure for Nevada DFS fans. Those who were cheated, will get no benefit because the firms won’t be regulated. Those who wish to continue betting cannot, as the DFS market in the state was abruptly killed.

This is the same thing that happened to poker players in the US overall. When the government increased banking regulations with UIGEA, online gambling didn’t end. Instead, it went underground, and people started getting cheated. The honest folks lost out, and the criminals just pushed their crime harder.

No good will come out of Nevada’s decision. Nobody will be helped, except maybe the cronies on the Strip and in downtown Vegas. With regulation, well-connected businesses win, but everyone else loses.