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RJ Davis of the North Carolina Tar Heels listens to head coach Hubert Davis as we look at Caesars joining the North Carolina sports betting market.
RJ Davis of the North Carolina Tar Heels listens to head coach Hubert Davis of the North Carolina Tar Heels in the huddle. Photo by Grant Halverson/Getty Images via AFP.

A rough start to the year just got worse for Underdog.

As the company gears up for a potential sportsbook launch amid the beginning of North Carolina sports betting, it has simultaneously pulled its popular fee-based pick ’em games. Since the start of 2024, Underdog has been forced to pull its product from New York, Florida, Arkansas, and Kansas.

The Future of Underdog in NC

In the notice sent to Underdog users on Monday, customers were informed that fee-based pick ‘em games would be replaced with free-to-play contests. Winners of these contests will win cash prizes that can be withdrawn or used in other areas of the Underdog app. These free contests are slated to begin by the end of this week.

Underdog has yet to earn a sports betting license from the North Carolina Education Lottery ahead of the state’s March 11th launch of legal online sports betting, which will include North Carolina sports betting apps. With the launch date approaching quickly, Underdog may have decided to pull its controversial game to curry favor in hopes of securing a betting license as soon as possible.

Daily Fantasy Sports Under Heavy Pressure

Underdog isn’t the only DFS-based company to come under scrutiny of late. Multiple industry leaders such as PrizePicks and Betr have received cease-and-desist letters from states around the country as well.

This legal action comes after long debates over the legality of DFS in states where sports betting is either illegal or heavily regulated. Sports betting is now legal in 38 states, plus Puerto Rico and Washington D.C. As the landscape of sports betting expands, Underdog seems willing to adjust its plans to earn more access in states where gambling is becoming legal.

What’s Next for Underdog?

Without knowing whether or not Underdog will receive a betting license in North Carolina, it's hard to know exactly what the future of the app looks like. If the decision to shut down their fee-based games is viewed positively, then this may allow Underdog to receive their license prior to March Madness, one of the most bet sporting events of the year.

No matter what happens in North Carolina, which will feature North Carolina sportsbook promos, the landscape is changing for Underdog and other pick 'em-type companies. These companies rose to prominence in states like Florida where sports betting was illegal until recently. However, as laws continue to change and develop in regards to sports betting, pick ‘em companies are having to adjust to the reality of the new betting world.

If Underdog can secure a betting license in North Carolina, then it may shut down its controversial product in other states where legal sports betting is on the horizon.