On Thursday night, the NFL season will kick off in a rematch of last year’s AFC Championship Game between the Baltimore Ravens and the Kansas City Chiefs, as fans tune in to see if Chiefs quarterback Patrick Mahomes can lead his team to a fourth Super Bowl victory in seven years – possibly, even, to an unprecedented “three-peat”.

It’s about as enticing a storyline as the league could hope for. And yet, it seems that most of the action will be taking place off the field, as Thursday also marks the beginning of the busiest time of year for those who play the game-within-the-game: sports bettors.

Five years after the 2018 US supreme court decision that threw sports betting back to the states, over $300bn has been wagered, with $120bn thrown in 2023 alone – a record that 2024 is poised to break, with more than 70m Americans expected to try their hand at beating the oddsmakers. Though companies do not disclose the amount wagered on each sport, the American football season is widely considered the industry’s marquee event.

So far, 38 states plus the District of Columbia have taken the plunge into legal sports gambling (LSG), most of which is done on smartphone apps operated by the young titans of the industry like DraftKings and FanDuel – who, collectively, handle the bulk of bets. Though there may be a few states that decline to follow the 38, possibly due to ethical and religious objections (Utah, for example), it’s likely that more will follow. And they will justify it on the grounds of a simple, appealing – but, critically, undercooked – logic: illegal gambling is dangerous, and lucrative; by making it legal and regulating it, we can reduce harm, cut organized crime out of the picture, and drive tax revenue to things we like, such as education, veterans services, the environment, and so on.

Will there be negative social costs? Perhaps, as is often the case when a vice is brought into the open. But it will do more harm than good. Or so the thinking goes.

So it’s entirely apropos that, just in time for football season, we have several new studies which directly challenge these assumptions by scrutinizing the effects of legal sports betting on consumer financial health.

Where most research predates the advent of our new app-based paradigm, focusing mostly on casino and illicit gambling, these recent studies come directly to bear upon an era in which bettors can “bust out” without even leaving their couches. And the findings, though modest in their net effect on the average consumer’s financial condition, strike directly at the heart of the assumptions used to push legalization in the first place.

In The Financial Consequences of Legalized Sports Gambling, authors Brett Hollenbeck, Poet Larsen and Davide Proserpio find that in states with legal mobile sports betting, among seven million individuals, credit scores worsen up to 1% on average, while the odds of bankruptcy in states with legal online betting increase by 25% to 30% after four years, and collections of unpaid debts increase by 8% – statistically significant findings which suggest a causal link between online access to LSG and elevated indicators of financial distress. (It’s important to note that these are statewide averages which incorporate the finances of those who don’t gamble at all, suggesting these modest figures are driven by dramatic changes in the financial security of the relatively small number who do.) The researchers also find evidence of proactive behavior on the part of lenders as they lower credit card limits to insulate themselves from exposure to the heightened risk environment caused by LSG.

The losses, meanwhile, are most heavily concentrated among young men from low-income counties, a finding which happens to rhyme with those of another study, provocatively titled Gambling Away Stability, in which researchers from the University of Kansas, Northwestern University and BYU observe that LSG reduces net investments by nearly 14% overall. That means that for every $1 of sports bets, net investment to traditional brokerage accounts is reduced by more than $2. Studying 230,000 households, they also found evidence of increasing credit card debt and overdrafts – and that financially constrained households deposit a larger fraction of their income than those facing fewer constraints. LSG seems to push low-savings households, in particular, into greater precarity than is the case for non-betting low-savings households.

In other words, both studies find that LSG makes it even more difficult for those who began their lives without wealth to ever build it. And the Hollenbeck-Larsen-Proserpio study makes clear that nearly every studied financial health indicator worsens in cases where the betting is done online or on mobile devices – which are, as they find, the avenue for more than 90% of all LSG – to the extent that those gambling offline are just not harmed to a comparable extent: “We find that while the general accessibility to sports betting leads to insignificant changes to bankruptcy filing, online access significantly increases the likelihood of bankruptcy filing” (emphasis mine).

As it happens, researchers have been on this tack for a while: A 2014 qualitative analysis of Australian gamblers cited by Hollenbeck, Larsen and Proserpio points to the absence of interpersonal scrutiny facilitated by online sports betting, as well as the perceived unreality of digital money (as opposed to cash), as particularly troublesome factors. Shut away in private, often isolated and alone, with the ability to top-up their accounts at-will, bettors only realized how much they had actually lost when reviewing their bank statements later on.

Meanwhile, digital technology has only gotten more sophisticated; with its unparalleled ease-of-access, placing bets via smartphone can only exacerbate these effects; I’ve interviewed men who found it difficult to sit through a film with their family without getting the jitters and sneaking off to the bathroom to play the mini-sportsbooks in their pockets. One man even placed bets in the shower.

By allowing users to bet any time, any place, companies keep demand for their services flowing with a steady barrage of advertisements, pouring hundreds of millions of dollars into ads for television, social media, billboards and metro displays. As ever, they will offer promos and free-plays, the tip of the spear when it comes to finding new customers and keeping existing bettors betting. (In one past case, customers could even earn a discount on the cost of an NFL streaming package by placing a bet beforehand).

As it is, men in their early twenties seem uniquely predisposed to taking big risks, prone to overestimating their odds of success and underestimating the costs of failure. Researchers have dubbed it the “young male syndrome”. By reducing inhibitions, inducing demand via massive ad campaigns and a shower of promos, frictionless mobile and online gambling are uniquely bad for consumer financial wellbeing and, it seems, uniquely bad for young men.

LSG shoulders young males with excessive financial burdens when they are still just beginning to earn and save, while other already-constrained groups suffer similar losses. It also drives a pernicious form of addiction which is illustrated by the established finding that suicidality is highest, among all addiction categories, in problem gamblers. As one case previously covered in the Guardian amply demonstrates, just as many can find themselves financially ruined without ever being addicted in the clinical sense, genuine problem gamblers can feel immense shame and guilt, even to the point of suicide, without being financially ruined. With more induced demand than ever before for sports betting services – and more betting and bettors overall than ever before – it’s far from clear that this new regime is safer for anyone.

The main argument for legal betting was that it would bring illegal, sometimes unsafe activities under the tax umbrella, driving state revenue that could be spent productively. But the thing is, and especially in light of the evident damage to consumer financial welfare, it’s really not that much money.

Take New York: As the journalist Ross Barkan points out, the $2bn of gambling revenues put into New York’s budget for education across two years “sounds impressive until you realize that in a single year, New York state spends more than $30bn on public schools.” Hollenbeck, Larsen and Proserpio agree, writing that “the negative effect we document can partially offset tax revenue benefits as more consumers’ financial health deteriorates.”

Thirty-eight state legislatures have so far instituted LSG while the negative trade-offs are still coming into focus. More states are lining up to do the same, while elected officials successful in the first regard are exploring ways to open it up further. A bill proposed in the New York legislature in January would allow remote bets on casino staples like blackjack, poker and craps (neighboring states New Jersey and Pennsylvania already do so). As it happens, New York spends only $0.50 per resident on problem gambling services compared to its neighbors New Jersey ($0.90), Connecticut ($1.20) and Massachusetts ($3.20).

While it’s often said that problem gambling is furtive, a so-called “silent” or “hidden” addiction, one perk of internet anonymity is that it gives men (it’s usually, but not always, men) an outlet for venting their shame and desperation. You can find them on the r/problemgambling.

Many profess to be at the end of their ropes, having lost everything, and post either for catharsis or the dim sense that someone, somewhere, might benefit from a cautionary tale. Others write about coming clean to their families and their (often) long-suffering spouses or fiances. “The self-hatred is overwhelming,” one popular thread is titled. Some genuine angels – usually long in recovery, themselves – hang around in the comments section offering to chat one-on-one, or to steer those at rock-bottom into services that might help.

Lawmakers have mostly ignored these stories, but they’re out there – some who gamble away their entire paychecks, others their 401ks, kids’ college funds, or their whole joint savings accounts. These are the people living the consequences of a heedless push towards more, and more frictionless, sports gambling. One would hope that regulation, or at least a conversation about adding some friction back into the process, is around the corner.

Until then, there will be more stories, as the companies involved do very well, and the costs continue to fall disproportionately upon the least among us.

For those who can’t help themselves, reminders of their problem are everywhere – and relapse, or ruin, just a swipe away.

• In the US, call the National Council on Problem Gambling at 800-GAMBLER or text 800GAM. In the UK, support for problem gambling can be found via the NHS National Problem Gambling Clinic on 020 7381 7722, or GamCare on 0808 8020 133. In Australia, Gambling Help Online is available on 1800 858 858 and the National Debt Helpline is at 1800 007 007