On Dec. 9, Donald Trump tweeted something incorrect but at least closer to the ballpark of the truth than most of what he’s posted since losing his reelection campaign.
“At 10 p.m. on Election Evening, we were at 97% [to] win with the so-called ‘bookies,’ ” Trump wrote. The “so-called ‘bookies’ ” never had Trump as a 97 percent favorite, but late on the night of Nov. 3, many online sportsbooks did indeed favor him to win the presidency. At points between 10 p.m. and 11:30 p.m. Eastern, many of these bookmakers—all of which are offshore, because election betting is not legal in the United States—posted odds that gave Trump around a 70 percent chance of victory. At 10:30 p.m., one of the most popular offshore books for U.S. bettors, Costa Rica–based Bovada, had Trump at -775, meaning a successful $775 bet would return $100 in profit. It implied an 89 percent chance that Trump would win.
If you were cursed enough to be following betting markets on election night, those numbers might have hit you like the New York Times’ 2016 needle on megasteroids. Political analysts had warned that delays in counting mail-in ballots could create a “red mirage,” where Republicans would look good based on the Election Day vote before Democrats made up ground. But the betting odds were not buying that theory of the race. They moved hard toward Trump when it became clear he would win Florida and looked good in North Carolina, Ohio, and Texas.
The betting markets were not good predictors, but they weren’t trying to be. The online bookmakers that fielded bets on the election saw their largest single-event windfall ever. To understand why, you need to understand election betting and Donald Trump supporters.
Offshore sportsbooks do not share detailed financials, but the 2020 election appears to have been the biggest online betting event in at least American history, to say nothing of what licensed bookmakers in Europe might have made.
Bovada’s head oddsmaker, Pat Morrow, said that his site handled “eight figures” in election bets, 95 percent of them coming from Americans, and that 30 percent more cash had been wagered on the race than the site’s previous biggest event, the Chiefs-49ers Super Bowl in February. At Panama-based BetOnline, the election also brought the largest sum of total wagers in history: “mid–eight figures,” according to sportsbook brand manager Dave Mason.
Whether the global online betting industry took in tens of millions, hundreds of millions, or billions of dollars in election bets will probably never be known. But to get an idea, imagine how much money is wagered on the biggest sports events, and then go much higher.
“Everybody knows that the Super Bowl is the biggest bet event of the year by far, and this doubled the last two combined,” Mason says. “It was absolutely insane. Not only the amount of people betting it, but the big bets that were coming in. Five figures and even six-figure bets coming in on both sides. We’d never seen anything like it.”
The odds-shifting bonanza on election night, with all that money on the line, was not a sign that the oddsmakers knew something the mainstream media did not. Instead, the Trump spike was the peak of a phenomenon that had been unfolding all year. Many Trump supporters were certain he could not lose, and they plowed so much money into betting on him that they distorted markets in his (and ultimately, the sportsbooks’) favor.
“It’s the most irrational market I ever saw,” says Collin Sherwin, a Tampa, Florida–based gambling writer who covers the industry for Vox Media’s DraftKings Nation.
Early in 2020, Trump was a steady if not overwhelming favorite at the sportsbooks. It made sense; the campaign had yet to start in earnest, but incumbents usually win and “the economy” was in good shape.
On Feb. 27, Bovada had Trump at -180 to win. That meant a $180 bet would return a $100 profit, implying a 64 percent chance he’d win. Joe Biden, struggling in the Democratic primary, was +2000, meaning a $100 bet would return $2,000 in profit if he won the general election. But then Biden—whom odds tended to portray as a likelier victor than primary rival Bernie Sanders—began to rebound.
Then the pandemic hit the U.S. In election betting terms, COVID-19 meant three things:
1) Most of the world saw Trump’s catastrophic handling of the virus for what it was, and his betting odds got longer as his approval rating sank.
2) People were cooped up inside, with fewer places to spend their money. And just as the gamified investment app Robinhood saw massive user growth during the pandemic’s early months, so did election betting markets.
3) The pandemic left people devoid of bettable events. “One of the few things that still seemed to be happening in the world, while very little was happening, were the primaries were still under way,” Morrow says.
As the pandemic wore on and Trump’s disinterest in managing it became clear, Biden’s odds got better and better. On June 4, Biden became the favorite for the first time at Bovada, moving to -110 while Trump was even money.
All this while, Trump’s odds were miles ahead of what election number crunchers suggested they should be. At the beginning of June, the betting odds said a Biden win was slightly likelier than a coin flip. At the same time, FiveThirtyEight’s polls-based model had Biden around 70 percent to win. (Nate Silver repeatedly noted this discrepancy and said in August that betting markets had become “so dumb as to perhaps be a contrarian indicator at this point.”) The Economist’s model had Biden closer to 80 percent.
Whether you believe in the virtues of polling and election modeling at this point or not, it was a weird split. When oddsmakers set the line for a Big Ten football game, analytical models heavily inform the point spread. If Ohio State is favored to beat Rutgers by 43, it’s because a computer predicted a result in that neighborhood. Then, the spread moves a bit based on injuries, betting patterns, and any useful information oddsmakers receive.
Here, the computers and the betting odds kept a wide gap. Oddsmakers don’t set odds based on what they think will happen. They aim to limit their risk and to create the best chance of “the house”—the bookmaker—making a profit. Too much money bet on one side is a liability. And in this case, there was so much money on one side: Trump’s.
“We needed Biden big,” Mason of BetOnline says. “We needed him huge.”
Throughout the year at Bovada, Morrow says, the money coming in was around 2-to-1 for Trump. At BetOnline, around 60 percent of bettors were on Trump, though the total money was closer to 50-50, meaning Biden backers placed some large bets.
For most of the year, Trump’s short odds to win (requiring bettors to risk more money for smaller winnings) were not a reflection of inside political knowledge, or of the oddsmakers being MAGA guys. Bookmakers were taking on so many Trump bets that they consistently tried to discourage people from betting on him.
“The Trump guys were just out in full force,” Mason says. “According to the true odds, they probably could’ve got a better price, but us and probably every other book kept it lower than it should, just because we were all so exposed on it.”
Time and again, the effort to get Trump bettors to chill out failed.
A few factors might explain the yearlong surge in pro-Trump bets. First, think about the median person who regularly engages in online betting. The stereotype that popped into your brain is probably correct.
“Trump supporters are loud,” Morrow says. “They love Trump in a way that most candidates are not beloved, but they also represent the demographic of a lot of sports bettors. These are people that are 18 to 45, generally white male.”
Also, consider that Trump maintained that he could not lose this election, at least not legally. If he lost, he signaled, he would lean on Republican underlings and judges to flip the result. (He then did the leaning, if not the flipping.) Only a quarter of Republicans, even by December, believed Biden’s win was legitimate. On Tuesday, a day after the Electoral College voted for Biden, people were still backing Trump on PredictIt, a predictions market, meaning anyone who wanted to could make free money betting on Biden.
“If you watched OANN [around or after the election], you’re watching something that you and I would never recognize,” Sherwin says. “It’s just a whole completely different world out there. And there is enough money amongst old, rich, white people that live in that bubble that take advantage of this betting opportunity for two reasons. One, what they feel and what they believe, but two, it’s also a way to kind of stick it to the ‘lamestream media.’ You know what I mean? I think they can be like, Oh, you guys don’t know what you’re talking about, and I think I can profit off of this because you don’t understand the Real America.”
Sherwin’s theory of older, moneyed bettors contradicts Morrow’s view of bettors as mostly young guys. But the two agree that MAGA rhetoric influenced betting market behavior.
Here’s another clue that Trump’s cult of personality inspired abundant irrational betting. For the first few months of the general election, Bovada bettors could toss their money into two different general election markets. One was “Biden against Trump,” the other “the Democratic Party against the Republican Party.”
While Trump got the overwhelming share of the money against Biden, those who bet on a party put more money on the Democrats.
“People wanted to have a Trump [betting] ticket,” Morrow says. “They didn’t wanna have a ‘Republican Party to win the presidential election’ ticket.”
“People bet on their favorite team, right?” adds Mason. “If you’re a Yankees fan, you’re betting the dang Yankees every night. It helps that they’re great, but there’s a lot of favoritism there. And you see that in political betting, too. You really do. You see people that are betting with their heart.”
On Election Day, FiveThirtyEight’s model gave Biden an 89 percent chance to win. Betting markets, on the other hand, generally placed Biden between 60 and 70 percent.
Usually, portraying one side as more likely to win than they should be (and thus lowering the payout if they win) sends bettors in the other direction. But for Trump fans, it seems possible that the betting odds acted as “proof” that the polls were wrong, the smart people knew it, and their man would win.
“Maybe we were signaling to Trump supporters, ‘Hey, keep the faith, it’s a lot closer than the polls are suggesting,’ ” Morrow says. “But all we were really doing was reacting to a liability.”
As election night progressed, it wasn’t unusual even for politically engaged liberals to see the returns in Florida and North Carolina and have considerable worries about a 2016-esque disaster. The odds’ heavy moves toward Trump that night—when he spent an hour or two as a 70 percent or better favorite on many websites—reflected some of that. Oddsmakers were considering their Trump liability but also reacting in real time, and it wasn’t yet a fait accompli that Biden would carry Michigan, Wisconsin, and Pennsylvania.
“There was that déjà vu thing watching that red and blue map on CNN or Fox or whatever we were watching it on, and the early count had all these swing states going to Trump,” Mason says.
Some bettors backed Biden when his odds became long enough, and they made significant profits. But Morrow said the Biden money, which was subject to live betting limits, barely made a dent in Bovada’s financial picture. The money still favored Trump.
“Anyone that got Biden live, I mean, great bet,” Morrow says, “but it didn’t hurt us at all. It was not even a flesh wound. We still cleaned up.”
Late that night, Fox News called Arizona for Biden, and Nevada started looking good for him, too. Overnight, new batches of mail ballots made Biden the clear favorite in Wisconsin and Michigan and suggested he was on a good pace in Pennsylvania. By the morning, Biden was a heavy favorite all over the market. And by 2:30 p.m. Eastern on Thursday, two days after the vote, Biden was -1100 and Trump was +575 at Bovada.
Through it all, Morrow said a huge majority of the money bet at his site remained on Trump—including “3- or 4-to-1” on Trump after the election.
“I think part of that was again the idea that ‘he might lose the traditional election at this rate, but we still have our ace in the hole: this potentially going through legislatures or the courts,’ which again, if you take Donald Trump seriously—this is the route he always said he was going to go,” Morrow says.
It took most of the bookmakers weeks to settle bets on the election. Mason and Morrow heard frequently from Biden bettors impatiently waiting on their payouts and from Trump bettors thanking them for not rushing to rash decisions. When they did eventually settle state and national bets, waiting until contested states certified results, the public faces of the big offshore sportsbooks got a different response from Trump bettors.
“ ‘You’re gonna regret this,’ ” Morrow recalls hearing from angry Trump bettors. “ ‘You’re gonna rue the day. This is gonna be the end of you. You’re gonna be working at McDonald’s.’ ” (Morrow sets odds from Antigua, where there does appear to be at least one McDonald’s.)
It is sometimes hard to tell which alleged Trump bettors are real and which are not. One screenshot surfaced of a bettor claiming to have bet $27,000 on Trump and demanding a refund but offering to have half of his bet returned to him as a compromise.
“We’ve got people living in two different realities politically, and we’ve got people betting in two different realities,” Sherwin says.
Are the bookmakers totally innocent? Were they baiting Trump supporters all along, milking gullible gamblers for all they were willing to bet?
Not in the beginning. The oddsmakers were living in the same simulation as the rest of us, unable to get Trump supporters to stop betting on their hero (and to stop adding to the sportsbooks’ liability). Both Bovada and BetOnline felt they were conservative with Trump’s odds, trying to slow down his backers.
“If anything, we were baiting Biden bettors,” Mason says. “We were giving them the discount.”
Only after the election did bookmakers reach the “taking candy from a baby” portion of the proceedings. Mason tweeted the day after the election, when Trump’s odds at BetOnline were +525 and 80 percent of the bets were still coming in on Trump, “Our massive liability continues to grow.”
That, to me, reads like baiting the gullible. But even then: Trump supporters were doing it to themselves. It’s not the sportsbooks’ fault if someone doesn’t realize that businesspeople aspire to separate customers from their money.
The sportsbooks won untold millions off a political movement’s refusal to accept reality. It wasn’t the oddsmakers’ plan to win by such large margins, and doing so despite making Trump a relative favorite was largely good fortune.
The 2020 election had many losers: Trump, his supporters, and American democracy chief among them. But almost by accident, the race created huge winners beyond Joe Biden. The biggest, arguably, were based not in Washington but in places like Panama City, and entirely unregulated by the government Biden was elected to lead.