One of the smaller online sports betting sites in the United States — albeit with a familiar name and a high-profile partnership with rapper Nicki Minaj — has shut down its wagering operations as a shakeout in the sector continues.
MaximBet announced Wednesday that it has closed its sports-betting operations and is no longer taking deposits or wagers.
Customers can withdraw their deposited balances until December 15, and any remaining funds left behind will be refunded to players via check.
“Open wagers will settle as per the MaximBet House Rules until Thursday, December 15, 2022, at which point they will be ‘cashed-out’ at current fair value market pricing and player balances will be returned via check,” the bookmaker says on its website.
The trend continues?
MaximBet is owned and operated by online-gaming company Carousel Group in partnership with the well-known Maxim Magazine.
In addition to teaming up with Minaj, the bookmaker is an approved operator of the National Basketball Association and Major League Baseball. It also announced in April that it had struck the first-ever partnership deal with an active professional baseball player, Colorado Rockies star Charlie Blackmon.
Still, the closure of MaximBet likely won’t have a huge impact on the legal sports betting industry, as it was a smaller player. As of this week, the online sportsbook was only live in two states, Colorado and Indiana.
Nevertheless, the closure also continues a trend of smaller players in the legal sports betting industry shutting down their wagering operations as they come to grips with a competitive and costly business and face tough economic conditions. For example, MaximBet's shutdown follows that of Fubo Sportsbook, which stopped taking bets in October.
The shakeout in the industry comes as smaller players are under even greater financial pressure than the larger ones, most of whom are having a tough time turning a profit themselves.
Here's full statement from @MaximBetUSA
— Eben Novy-Williams (@novy_williams) November 16, 2022
Key line: "Our ability as an early-stage company to compete in a market where operating costs far exceed revenue, even among the top operators, is not sustainable." https://t.co/jzV90cisUL pic.twitter.com/hUGNW9VS49
Worsening economic conditions may prompt others to follow suit. In a statement regarding its closure to Sportico, MaximBet said that "current macroeconomic conditions" forced the move.
"While making great strides in offering customers a completely unique player experience, our ability as an early-stage company to compete in a market where operating costs far exceed revenue, even among the top operators, is not sustainable,” the company said. “Our priority now, in consultation with state regulators, is to wind down operations and help active customers in Colorado and Indiana withdraw their funds and close their accounts."
