Why I’m not Scared of the DraftKings Employee Scandal

This isn't the Black Friday of Daily Fantasy Sports This has not been a good week to be a daily fantasy sports business. With know-nothings across the galaxy sounding the fear-mongering alarm of "insider trading," people making the obvious comparison to the rise and fall of online poker, and big-government advocates banging the drum for more regulation, it's certainly understandable to be a little bit scared. But I'd like to throw some cold water on this whole scandal, and the potential negative consequences it could have in the world of daily fantasy sports. As I see it, there are three major aspects to this story. The first is what might happen next. Whatever happened with Ethan Haskell, DraftKings, and FanDuel is in the past. Various legislators trying to make a name for themselves might really threaten our whole existence, but I'm actually a lot less scared than you think. In a huge section below, I'll break down how the world of DFS compares with Online Poker, and why we have less to fear than you might think. The next is the incident itself. This has been covered ad nauseum elsewhere, but to give you my fifty word take: I think it's highly unlikely that Ethan Haskell was actually cheating using this information. In particular, the fact that he could make the mistake to send out ownership percentages early means he likely either A) didn't even have access to them when he could use them to cheat or B) it didn't occur to him to use them for that reason. If he was using this information to cheat, he'd be a colossal dummy to tweet it out early - and this just doesn't fit his profile. And even if he was using it to cheat, it's a veritable drop in the DFS bucket. I'm just not particularly scandalized, here. The last thing, as I see it, are the very real problems that do exist in the world of daily fantasy sports. From a long term game sustainability perspective, there are some very troubling things going on here. And if we can bring to light what they are, maybe we'll be able to keep this gravy train flowing (and people having more fun) a lot longer. I'll close with those thoughts at the end. Let's dive in. Will daily fantasy sports go the way of online poker? If you haven't read here for long, you may not know that I was a professional online poker player from 2003 to 2011, or that I also co-owned a continuing education platform for online poker players (much like DFSR, but for poker). If you weren't a part of that world, you may not know...