On the eve of Thanksgiving, plaintiffs from six states filed the civil lawsuit against Kalshi in New York claiming that the prediction market platform violated state gambling laws, engaged in illegal deceptive activity and unjustly enriched itself at the expense of its customers. Attorneys for the plaintiffs filed the suit one day after a Nevada federal judge lifted a preliminary injunction that previously enabled Kalshi to continue operations in the state. Kalshi indicated that it plans to appeal that judge’s decision.

Kalshi, which handled more than $1 billion in NFL event contracts in the first month of the 2025 season, described the class-action lawsuit as “meritless fiction”. In a statement released 26 November, Kalshi wrote: “This lawsuit demonstrates many fundamental misunderstandings about how federally regulated DCMs (designated contract markets) operate.”

The lawsuit appears to be the first of a class-action variety against a prediction market, an asset class that has grown rapidly over the last six months. The suit may trigger further debate on the role of market makers throughout the exchange trading ecosystem. Market makers are typically defined as firms that help facilitate the buying and selling of securities by providing liquidity.

Plaintiffs: Market makers benefit at expense of consumers

In April 2024, Susquehanna International Group (SIG) announced a partnership with Kalshi, under which it became the first institutional market maker to launch a trading desk dedicated specifically to event contracts.

Founded by billionaire Jeff Yass, SIG is a global quantitative trading firm that serves as a market maker for a wide range of trading products, particularly options and exchange-traded funds (ETFs). While Kalshi partners with other market makers beyond SIG, the prediction market has not disclosed the names of the other companies. SIG is widely viewed as Kalshi’s primary market maker.

According to the lawsuit, market makers benefit from their “unique contractual and technological integration” with prediction markets. The relationship, the plaintiffs contend, provides the market makers with unfair advantages such as reduced fees, differing position limits and enhanced access to the markets. Moreover, the advantages “greatly reduce” the market makers’ financial exposure, the plaintiffs allege.

“As a result, individual consumers hardly stand a chance, all the while thinking they are just betting against other consumers,” the lawsuit states.

A market maker essentially serves as a counterparty to ensure there is enough liquidity on the platform. For instance, a buy contract on the Detroit Lions to defeat the Dallas Cowboys this Thursday is priced at 61 cents on Kalshi (a payout of $164 on a $100 trade). For every trade, a counterparty must take the other side. At one point Tuesday morning, there were 138,689 contracts on the Lions at 61 cents for $84,600. However, a Kalshi user does not know if the counterparty is an institutional market maker such as SIG or another retail consumer.

Kalshi co-founder: An attempt to discredit prediction markets

Kalshi co-founder Luana Lopes Lara took exception with the lawsuit in a lengthy post on her X account. She called the allegations false, adding that any company with a large consumer base deals with lawsuits “that have no merit”. In addressing the market maker allegations, she stated that Kalshi is a peer-to-peer exchange that doesn’t have “a house”.

Along with SIG, Kalshi operates its own market maker, an affiliate called Kalshi Trading. The offering is a common practise within the industry, Lopes Lara said, emphasising that many financial exchanges have a similar setup. Last month, Kalshi Trading represented less than 6% of the platform’s making volume, she indicated.

She also criticised the author of a post on X who wrote that Kalshi misled users into adopting the belief that they wagered against other bettors, when in fact they wagered against the company. The author, who goes by the username @rawsalerts, received more than 460,000 views with the post.

“It’s not surprising that entrenched interests are seeding false narratives to discredit prediction markets: this is very similar to what the banks did to discredit the crypto industry (a good reminder not to blindly trust what you read online),” Lopes Lara wrote.

Alfonso Straffon, a prominent financial analyst in the sports betting space, wrote a letter to the US Commodity Futures Trading Commission ahead of a proposed roundtable on prediction markets. In a six-page letter, Straffon explained why betting markets on sports are driven by the same kind of economic forces and actors found in any financial market.

“In the business of sports betting, the bookmaker is no different than a market maker as defined in the world of financial markets, including those market makers authorized by the CFTC to provide liquidity on designated contract markets such as Kalshi,” he wrote.

Upcoming cases

Represented by three attorneys from law firm Lieff Cabraser Heimann & Bernstein LLP, the plaintiffs filed last week’s lawsuit in U.S. District Court for the Southern District of New York. After the New York State Gaming Commission sent Kalshi a cease-and-desist order from operating in the state, the company filed a lawsuit in October seeking to block the state from enforcing the order.

Besides New York, at least a half dozen other states have filed comparable orders against the prediction market site. The list includes New Jersey, Illinois, Nevada and Ohio, which all rank among the largest states nationwide in sports betting handle.

In September, Massachusetts Attorney General Andrea Campbell filed a suit against Kalshi alleging that it is operating in the state as an illegal sports betting platform. On 9 December, a court in Massachusetts will hold a hearing addressing the state’s preliminary injunction against Kalshi and the company’s motion to dismiss the case.

The new lawsuit comes as the nation’s top sportsbooks prepare for the debut of their own prediction markets. Both DraftKings and FanDuel plan to roll out prediction market platforms in the coming months. Soon after, they are expected to be joined by Fanatics, Coinbase and US President Donald Trump’s Truth Social platform. Kalshi is facing further pressure from news last week that SIG and Robinhood will form a joint venture to launch their own prediction market exchange.

By 2022 that logic had collapsed under its own contradictions. Channelisation had sunk below 50%, Veikkaus’ annual contribution to the state had halved since 2017, and policymakers across the political spectrum were conceding — quietly at first, then publicly — that the monopoly was no longer defensible.

Now the country is poised to become Europe’s newest licensed market. What remains uncertain is when the competitive regime will actually begin. The legislative process — still officially aligned with the government’s timetable — has begun to buckle under political nervousness about advertising, electoral timing and the preparedness of regulators.

But while Parliament wrangles over dates, operators are already building teams, commissioning legal advice and shaping local strategies. The Finnish opening is small by European standards but symbolically weighty: one of the last Nordic holdouts is moving into the mainstream. And the industry is preparing accordingly.

Where the bill stands—and why delay now looks likely

At a technical level, the bill is close to the finish line. “The Finnish Parliament’s Administration Committee decided to conclude its hearings on 13 November and is now drafting its report,” says Antti Koivula, chief compliance officer of Hippos ATG. He expects the report “at the very latest mid-December”, after which the two plenary readings “can be completed relatively quickly”.

Independent consultant Jari Vähänen offers a similar assessment: “Parliament is still considering the bill. The Administrative Committee is almost ready, and Parliament will have time to approve it this year, when the law will enter into force on 1 January 2026.”

And yet the committee’s schedule tells another story. Pekka Ilmivalta of Nordic Legal had noted an omission in dealing with the bill in the administrative committee’s weekly plan, which, he said, “raises concerns about the timetable”.

Behind this ambiguity lies political considerations. Both Ilmivalta and Vähänen point to last-minute discussions about pushing the market opening from January 2027 to summer 2027 — after Finland’s parliamentary elections.

Gambling operators aware of potential delay

Operators received the same signals. A representative from a big operator told iGB that “government are now discussing postponing the market opening … so after the elections in April”, explaining why the item was unexpectedly pulled from the committee’s agenda.

What is driving the hesitation? According to Vähänen, “political decision-makers fear that gambling marketing will increase so much that public opinion will turn against it before the parliamentary elections.” Even parties broadly supportive of liberalisation prefer to postpone any visible shift until after the vote.

Most observers therefore expect a short delay — weeks in legislative approval, months in market opening. As University of Helsinki researcher Janne Nikkinen puts it, “Perhaps a delay of a few days or weeks, they’re mostly ironing out technical issues.” The law’s substance is not in question; the timeline is.

A spokesperson from the Ministry of Interior could not comment on a possible delay, but said in an email to iGB:  “The aim of the Administrative committee has been to complete the report in November, according to the estimate, after which the report is meant to progress to the plenary session”.

Consensus without clarity

Despite procedural delays, political unity on the need for reform is unusually strong. “There has been broad cross-party consensus for a few years that the gambling market should be partially liberalised,” Koivula says. Differences remain over advertising and harm prevention, but not over the direction of travel.

Ilmivalta explains the logic: “Channelisation of the monopoly is less than 50%, income for the Finnish government has declined and at the same time problem gambling has been slightly increasing. The current system simply does not serve its purpose any more.”

And unlike in many European debates, the opposition has little incentive to resist change: Veikkaus itself declared as early as 2022 that the monopoly should be dismantled. As Nikkinen puts it, “Even the opposition isn’t opposing the reform, because Veikkaus itself said it no longer wants the monopoly.”

The political friction, therefore, is not about whether but when.

A regulator still not ready for day one

While legislative consensus holds, confidence in regulatory readiness is far thinner.

Koivula is frank: “I am not fully confident that the transition will be seamless.” Although the National Police Board will supervise licensing through 2026, he warns that “the new authority will need to hire a substantial number of employees, and very few — if any — will have prior experience in the gambling sector.” Even within the National Police Board, he says, “this remains to be seen.”

Nikkinen is more pessimistic: Finland’s model “relies on courts, which can take years. That’s too slow for fast-moving marketing campaigns.” The new authority will sit within a regional administrative agency that also handles unrelated topics, from animal welfare to alcohol licensing. “They won’t have power to sanction directly. That’s a weakness,” he says.

Vähänen is more hopeful, believing staff will transfer from the NPB and that the technology project “will be ready in 2026”. Ilmivalta, though trusting in Finnish administrative competence in general, stresses that preparations “have not been very transparent, nor has the regulator had much dialogue with the industry”.

The result seems to be a split-screen picture: operators preparing with determination, and regulators racing quietly behind.

A black market problem without the tools to solve it

Every expert interviewed agreed that the largest structural weakness is enforcement.

Koivula’s assessment is blunt: “I foresee nothing but enforcement challenges. The enforcement toolbox provided to the regulator is highly insufficient for tackling black market operators.” He warns of a counter-intuitive outcome in which “the majority of enforcement actions end up targeting licensed operators”, simply because they are visible and cooperative.

Nikkinen underscores the legislative omissions: Finland “does not include payment blocking, website blocking, DNS blocking”, partly due to political resistance and partly because the autonomous region of Åland — and PAF — complicates national blocking measures. The result, he predicts, is persistent leakage: “I believe leakage to the black market will continue, and that we’ll need to revise the law again by 2029 or 2030.”

Ilmivalta shares the concern: “There will always be those who decide not to join the regulated market, and the regulator’s tools are not too many.” The B2B licensing requirement in 2028 will help, but is unlikely to be decisive.

Even the operators’ own trade body, the Finnish Gambling Association, Rahapeliala, strikes a cautionary tone. CEO Mika Kuismanen argues that “the bill in itself does not contain enough explicit tools to combat the black market”, warning that if supervision focuses only on licensed companies”, unlicensed operators will not have sufficient incentive to consider the legal market.

Operators prepare: cautious, optimistic and waiting for certainty

Despite the regulatory grey zones, operator sentiment is broadly positive. “The industry as a whole has a positive feeling,” says Kuismanen. The legislative process has been relatively fast and well structured, even if “operators will still have to wait before starting full preparations”, he says.

FDJ/Kindred´s general manager for Finland and Estonia, Joel Hakamies, echoes that view: “It’s looking fairly good for the big picture. Overall it’s been fairly positive from our view.” The main constraint, he says, is uncertainty: “For our planning it would be better if the timeline was set in stone sooner rather than later. Uncertainty always blurs the horizon for investment.”

Hippos ATG, meanwhile, is preparing at full speed. “We are building a Helsinki-based organisation, recruiting experts on product, marketing and customer support,” Koivula says. For Hippos ATG, Finnish liberalisation is not just commercial: “Every euro of profit flows back to Finnish and Swedish horse racing — a model no other operator can offer.”

Ilmivalta sees a wide variety of strategies: “Some operators will establish local organisations while some are planning on operating very much remotely. Some are customising, some trust that their international offering works.” He also expects variety of new and innovative measures in brand-building under advertising constraints.

Marketing: permissive or restrictive?

Advertising rules are emerging as one of the most contested elements of the reform. The government’s responsible advertising clause drew criticism for vagueness, and even the Basic Law Committee questioned whether courts could interpret it effectively.

Nikkinen notes that Finnish media interests are lobbying heavily, while affiliates have been “banned”, leaving an “uneven table”. He warns that traditional media — not online channels — are the dominant source of exposure for consumers, including children.

Operators themselves are split on how restrictive the framework will be. Kindred sees the new rules as “actually quite liberal”, with “plenty of possibilities for operators to make their mark”. Kuismanen, too, believes “almost all channels are available and there are no time limits”.

What Finland means for Europe

Analysts that iGB has spoken to agree Finland will not transform the European landscape overnight. “In reality, the wider impact will be limited,” Koivula says. Vähänen and Kuismanen concur.

Yet Finland matters symbolically: it is the first Nordic monopoly to fall since Sweden in 2019, and Norway will be watching closely. As Nikkinen notes, Norway “still maintains a strict monopoly”. Whether Finland succeeds — or struggles — will shape its neighbour’s arguments for years.

More broadly, Ilmivalta expects Europe to move gradually toward harmonisation in the 2030s, driven by black market control and safer gambling priorities.

A market worth the wait

Finland’s opening is not smooth, nor is it fully defined. But operators appear willing to tolerate uncertainty for a market that remains both lucrative and culturally embedded. “Finland has been and will be an attractive gambling market,” Hakamies says. “Definitely a major opportunity.”

The real test will come not in 2026 or 2027, but in the following years — when Finland must decide whether its lightly armed regulator and incomplete enforcement architecture can deliver the channelisation and consumer protection the reform promises.

For now, the industry waits — impatient, optimistic and already laying its bets.

The trade-off is clear. Regulated businesses offer durable, if slower, returns and build genuine institutional equity value. Unregulated peers deliver rapid ROI but sacrifice longevity and rarely accumulate lasting equity.

For years, investors accepted this sustainability vs. speed equation. Recently, however, the “regulated markets offer certainty” argument has collapsed spectacularly.

Whatever happened to the grey?

The distinction between regulated and unregulated is now binary. Enforcement risk and institutional pressure have made operating in between untenable. Bet365 made headlines last May as bankers circled and liquidity-event rumours intensified. The backdrop: withdrawals from India in 2023 and China in 2025. Analysts estimated around £185 million in lost Chinese revenue – a trade-off the company appeared willing to accept to refocus on fully regulated markets.

Bet365’s retrenchment underscores that institutional-scale operators can no longer justify regulatory ambiguity – and how quickly crypto challengers move to occupy the space. Stake, BC.Game and other crypto-first platforms have expanded aggressively, serving global audiences from offshore jurisdictions.

Below is a Google Trends chart which shows a stark reality of the bleed from Bet365 to Stake over the past three years.

In 2025 we witnessed eye-watering valuations for unregulated crypto iGaming startups, often trading at parity or even a premium to regulated peers. Capital is impatient. With leverage expensive and M&A markets weak, allocators prioritise near-term cash generation. The traditional “safe” bet is being strangled by red tape and legal frameworks that squeeze onshore margins and stretch ROI timelines. As players and affiliates migrate offshore, liquidity and capital inevitably follow.

The protagonist: Tax and compliance burden

In key markets, the public take now exceeds 50% of GGR on certain products. Pennsylvania taxes online slots at 54%. New York takes 51% of sports-betting revenue. Germany taxes turnover on slots and poker, forcing operators to cut RTP and pushing players to unlicensed sites where their money goes further. The Netherlands hiked its online gambling tax to 34.2% this year and 37.8% in 2026. These policies wreck channelisation. Players chase value; affiliates chase traffic; investors chase cash.

Governments treat online gambling like tobacco or alcohol, forgetting that gambling lives on a borderless internet where VPN use is second nature (global data shows VPN penetration exceeding 40% in several key iGaming territories). Tobacco and alcohol cannot be consumed online (joking aside).

By copying policies built for physical vice markets, regulators ignore the elasticity of demand. When taxation and restrictions rise, players don’t stop gambling; they simply move to unregulated sites that offer better odds and familiar product features. Over-taxation and blunt restrictions will ultimately reduce treasury revenue while undermining player protection. Offshore operators often ignore responsible gaming tools and aggressively target vulnerable users. Until policymakers wake up, the gap between the regulated and unregulated sectors will only widen.

Reality cheque, please

Today’s hot thesis promises juicy yields, but is it worth the risk? Australia offers a sobering reminder. Since 2017, the ACMA has blocked approximately 1,000 illegal sites, resulting in more than 200 offshore exits.

One rule change or a coordinated payment squeeze can flip economics overnight. Crypto is no invisibility cloak – blockchains are traceable. The moment value hits a KYC off-ramp, identities attach. That limbo leaves a paper trail.

So why are valuation multiples converging? Two forces are at play: First, public-market compression: Regulated gaming stocks trade at roughly half the multiples of average tech peers, reflecting regulatory headwinds and slower growth. Private regulated deals anchor even lower. Public buyers can’t pay up without diluting their own stock unless synergies are ironclad. That structural ceiling compresses valuations across the regulated M&A chain.

Second, cash-yield hunger and scarcity. Unregulated valuations are driven by capital rotation and simple supply-demand dynamics. Investors are buying yield streams, not future listings. They price cash-flow yield, not blue-sky equity. The strongest bids go to businesses with high double-digit growth, minimal capex, unrestricted product features and borderless reach.

Unregulated assets can still sell, but the buyer pool shrinks with scale and multiples drop to low single digits. Policy sets the spread. Turnover taxes and GGR rates above ~35% crush onshore margins. Ad bans and product restrictions inflate CAC and shrink LTV.

Germany compounds the pain with stake limits and strict advertising bans, making market recovery nearly impossible. The result is more capital chases grey cash cows while they last.

The US has delivered shocks before: UIGEA (2006) and Black Friday (2011) reset online poker overnight. A similar jolt would reprice unregulated assets.

Operator signals matter. Tim Heath pioneered crypto-first betting withSportsbet.io and Bitcasino; his public pivot toward licensed frameworks is telling. If you want a strategic exit or institutional capital, play by the rules. The market ultimately rewards cash-generative and licensable over cash-generative and opaque.

What’s persistent, what’s transient?

Persistent (micro): As long as regulators overreach, then high taxes, blunt limits, weak channelisation and a vacuum remain. Nimble unregulated players will fill it, and risk-tolerant capital will fund them for yield.

Transient (macro): 2025’s volatility should fade (absent black swans). Falling rates and looser liquidity typically lift gaming equities. Cheaper capital also makes regulated cashflows more valuable, pulling pricing back toward licensed, auditable businesses. In the near term, quality assets may see narrow spreads; overtime, the premium should drift back to licensed operators as enforcement and traceability tighten.

As liquidity cycles turn, risk capital will again chase the highest yields, until policy/enforcement resets the spread. Each cycle brings the same lesson: yield can price anything until it can’t. Every yield has a half-life; know which one you’re buying.

Takeaway for capital allocators?

Don’t overpay for cash cows. If equity value and capital appreciation are capped, price for run-off, not fairy-tale exits. Price the licence. Value credible paths to regulated revenue; without them, expect earnouts and holdbacks. Audit the rails. Payments and AML posture determine bankability – weak rails mean a governance discount.

Assume traceability. The “anonymous” premium is gone. Investment always sits somewhere on the risk spectrum. Just make sure the reward justifies the ride.

BEN ROBINSON is managing partner of Corfai and an entrepreneur, investor and adviser with over 25 years of experience in iGaming, payments, tech and media. Since entering iGaming in 2009, Ben has led a global publishing business, co-founded and exited a crypto exchange and, through establishing RB Capital and Corfai, completed over 20 transactions and raised millions in investment capital.

A dominant global force in gaming, the operator has become market leader in the US through its FanDuel brand and has expressed similar lofty ambitions in Latin America.   

In September 2024, Flutter acquired a 56% stake in NSX, the parent company of Brazil-facing brand Betnacional. That same month, the company insisted the deal boosted its market share to 11%. NSX provided the operator with a wealth of local talent and experience.

The deal was completed in May, when NSX CEO Joao Studart stepped into the top job at the newly formed Flutter Brazil.

The agreement mirrored Flutter’s strategy across Europe and the US, combining local brand strength and the group’s financial and technology firepower and global structure. For Studart, the deal made perfect sense and marked a new chapter for the Brazil sports betting market.  

“Flutter saw in Brazil not only an opportunity for strategic expansion, but also a market with real prominence within the global sector,” Studart tells iGB. “It recognised in Betnacional a successful example of genuine connection with Brazilian fans – a popular, culturally rooted and fast-growing brand.” 

M&A specialist Christian Tirabassi, founder and senior partner of Ficom Leisure, believes Betnacional was a top-10 player in Brazil’s pre-regulated market.

Acquiring a local hero of this size meant Flutter could achieve an early-mover advantage, a key benefit in such a highly competitive market.

“The opening of other markets has shown us that whoever is early into the market has an important market share and will probably stay there or even increase that leading position,” Tirabassi says. 

Local prowess 

Stakeholders have noted just how important localisation is to succeed in Brazil, which differs culturally from its LatAm neighbours even beyond the language distinctions.

Pre-regulation, many shared the belief that international entrants could struggle in Brazil unless they properly localised through a boots-on-the-ground approach that differs vastly from their other markets. 

Studart believes Flutter Brazil combines NSX and Betnacional’s local prowess and the Flutter Edge technology stack, bringing scale and local autonomy.

“Flutter Brazil [is] an operation that remains Brazilian at its core, with local leadership and a deep understanding of the consumer,” Studart explains. “At the same time, it operates with the resources, governance and technology of a global group. 

“Through the Flutter Edge, we brought to Brazil state-of-the-art tools, a robust infrastructure, high-level compliance standards and a responsible gaming programme tailored to the country’s reality.

“At the same time, we preserved Betnacional’s essence as a local hero – a brand that represents the Brazilian spirit of football, entertainment and popular culture.”

Brazil’s launch has dominated gaming news in the last couple of years. A huge nation with a population of around 213 million, Brazil has a vibrant sporting culture, and many expected its opening to provide an entry into LatAm’s growing gambling opportunity.  

H2 Gambling Capital ranks Betano, Superbet and Bet365 as its top three players by market share, according to its revenue estimates. International entrants are clearly gaining a strong foothold in the market.

Since the launch, operator revenue figures for Brazil have varied. In Q1 most listed players reported strong numbers as early entrants, but as competition has increased, and KYC pressures remain, some have seen that growth slow slightly.  

In Q3 London-listed Entain warned that iGaming was not performing as well as it could be, due to a slow and arduous certification process, which meant few games were available in the market during the period. Flutter reported revenue of $87 million in Brazil in Q3, marking a 412% uptick on the same period in 2024, prior to regulation.  

Of course, this year the company has included NSX’s revenues within its mix, with Betnacional reportedly achieving record iGaming revenues during the quarter. Excluding NSX’s revenue, Flutter saw a 18% year-on-year revenue drop across its Betfair brand in Brazil.

Group CEO Peter Jackson said this was due to its continued recovery from bottlenecks that occurred during and following the regulatory process.

Ed Birkin, H2 Gambling Capital managing director, estimates Flutter Brazil is currently sitting in fifth position in the market with a 4.5% market share. 

“While it’s still very competitive at the moment, I would imagine Flutter’s strategy will be focused on getting the best product [out],” Birkin explains. “And then as other people start to pull back, which is going to happen at some point because the losses that I’d imagine a lot of companies are making aren’t sustainable, that’s when they will start to leverage their financial firepower, start to lean in as they call it and pick up the slack.” 

A slice of the pie 

The Flutter Edge platform is the core function powering the operator’s “local heroes” strategy, through which it has acquired numerous leading brands in various markets and integrated them into the central platform.

Analysts are bullish on the power of the Edge platform. In December 2024 Macquarie senior gaming analyst Chad Beynon estimated the platform would help Flutter gain up to 25% market share in Brazil by 2030.  

In his December note Beynon said the platform had proven to affect market share gains in new markets quickly. He also said further M&A was on the cards for Flutter in LatAm.  

“Flutter Edge brings to Brazil state-of-the-art resources in infrastructure, data intelligence, innovation and compliance – ensuring that our brands operate with robustness, speed and security,” Studart says. “At the same time, we have the freedom to adapt products, experiences and strategies to local realities, delivering tailored solutions that truly connect with our audience.  

“It is precisely this combination of global structure and local leadership that positions Flutter Brazil among the most prepared companies to lead the sector – with consistency, credibility and a positive impact on the entire ecosystem.” 

Birkin expects Flutter will invest heavily in marketing further down the line, as competition slows and others pull back from the market. This will enable it to capitalise on waning competition, a strategy that worked for Flutter in stunning fashion in the US. 

“My view is the best strategy would be to focus on integrating their very strong technology and know-how into the Betnacional business to improve the product,” Birkin says. “Once they’ve got the product where they want it, then to spend their money on marketing as others pull back on it. 

“What you’d notice in the US is that as people started pulling back on bonusing and marketing, as lots of operators were loss-making, they pull back, then FanDuel starts to lean in and kind of use their scale to take customers.”

Birkin notes Bet365 employed a similar strategy in the US, where the operator avoided spending huge amounts to gain brand awareness. Instead, it operated efficiently in the background, waiting to make market share gains when others pulled back. 

The sheer scale of Flutter Brazil compared to smaller operators is demonstrated by its massive local workforce of over 500. The business operates multiple functions locally, including technology, marketing and customer services. The company also recently changed its corporate structure, with a raft of new C-level appointments to work alongside Studart. 

Flutter Brazil has drawn from other sectors to build out its executive team, while also ensuring a combination of international expertise with a “deep cultural connection” to Brazil.

“The IT team is a great example of this integration, with professionals from Flutter’s international structure working remotely in collaboration with the local team, expanding our capacity for innovation and integration,” Studart adds. 

“The new executives bring extensive experience in their fields, foster local reach and lead highly qualified teams that are already recognised as industry benchmarks, always operating with responsibility and a long-term vision. With Betnacional as part of its brand ecosystem, the goal is to sustain an operation centred on Brazilian talent and local insight.” 

Further M&A 

Tirabassi shares Benyon’s view that Flutter will make other acquisitions in LatAm, in part due to their strong history of successful M&A across its global portfolio and with the company’s sights set on reaching the summit of the regulated Brazil sector.

“Their objective, clearly, is to become number one, and that’s why I think they’re going to make other acquisitions,” Tirabassi says. “Large ones that would allow them to be quickly number one or number two, so something of the same size or similar size. I think that Flutter is actively looking for an [M&A] target. I know that for sure.” 

But Tirabassi knows well that this process isn’t easy.

“We believe the issue [in Brazil] is finding a target which is ready to transact,” Tirabassi adds. “Being on the sell side, the majority of the work we do is prepare the target, because they’re not ready. We understand the priority is business. But then again, very big business, very small corporate. So that’s why we’re trying to kind of help them to realign the size of the corporate together with the size of the business.  

“They need at least a couple of quarters to organise the company. So, we expect that in 2026 you will see some additional M&A in the market, because targets will be in a better position than now to engage in a transaction with a company like Flutter.” 

With Birkin currently ranking Flutter Brazil and its Betnacional and Betfair brands at number five in the market, he has reservations over whether they can scramble to the top spot. H2’s numbers give Betano, Superbet and Bet365 a combined 47% of the market, and Birkin feels that could be a tough trio to crack for Flutter. 

“They want to be in a podium position,” Birkin explains. “On our numbers that would involve them overtaking Sportingbet and Superbet. Is that possible? Yes. Do I see them being able to capture in a year, five years, Betano and Bet365? That would involve a significant change in market structure.” 

Tirabassi, however, is a little more confident and believes in the value of the NSX acquisition. Add to that Flutter’s capability to conduct more M&A, and Flutter could certainly buy its way to the top.  

“I think the difference is that culturally, the Flutter group has been extremely capable in M&A, they have a very strong team and also the guys that come after the deal. Betano has basically no experience in M&A or very little so it’s not really their culture.” 

Ultimately, Studart is confident Flutter Brazil will continue to make strides in the new and exciting Brazil market.

“The Brazilian market is going through a phase of consolidation that brings great opportunities for operators who invest with seriousness, a consumer-first mindset and a commitment to best practices,” Studart concludes.  

“The progress of regulation has laid the foundation for a more balanced ecosystem – one that combines innovation with responsibility. Flutter Brazil sees this new scenario as fertile ground for sustainable growth. By combining global scale with a deep understanding of local specificities, we aim to actively contribute to the sector’s maturation – offering relevant and safe experiences to users while reinforcing the pillars of trust, transparency and Brazilian culture that underpin our brands.” 

From hearings and information demands to renewed pitches for the SAFE Bet Act, members of Congress are using cases involving MLB and NBA figures to argue that state-by-state oversight has left dangerous gaps in consumer protection and game integrity.

But operators and lobbyists counter that regulated books have helped uncover the misconduct now driving the headlines. They also see Washington’s partisan dysfunction as a major obstacle to any serious move toward a national sports betting framework.

“You have a situation where there is interest in the topic and will remain a lot of interest,” said Brandt Iden, vice president of government affairs at Fanatics Betting & Gaming and a former state representative in Michigan.

“Congress will do its job and there will be a committee hearing and air things out. What I hope is this is not a situation where it’s finger-pointing [and is instead] more a collaborative discussion on how it works. The reality is these things are uncovered because of the regulated market, and together it becomes an education process.”

Are more sports betting hearings coming?

In December 2024, the Senate Judiciary Committee held a hearing on sports betting that lasted approximately two hours and ventured off track into partisan arguments. Senator Dick Durbin, committee chairman at the time, said it was just the beginning of discussions on sports betting, but the committee did not hold another hearing.

Following the recent scandals, however, legislators are calling for information from leagues. The US Senate Committee on Commerce, Science and Transportation sent a letter to MLB Commissioner Rob Manfred with six questions. The committee set a 5 December deadline for response.

“MLB has every interest in ensuring baseball is free from influence and manipulation,” the letter reads. “But in light of these recent developments, MLB must clearly demonstrate how it is meeting its responsibility to safeguard America’s pastime.”

The MLB plans to cooperate in the questioning around Cleveland Guardians pitchers Emmanuel Clase and Luis Ortiz, who are accused of manipulating pitches to enable sports betting profits.

The same committee and members of the House Committee on Energy and Commerce also requested answers from NBA Commissioner Adam Silver. NBA staff members were reportedly on Capitol Hill earlier this month.

The House committee is also looking into the NCAA, which has had its own slew of sports betting scandals.

Could discussions highlight benefits of regulated market?

The sports betting scandals have caused lawmakers, as well as the general public, to question the integrity of sports and blame – at least in part – the widespread legalisation of sports betting. Many, including Durbin, have specifically called out the potential for manipulation of prop bets. Recently, major sportsbooks agreed at MLB’s urging to place a $200 cap on pitch-level microbets.

Some state regulatory agencies, including the Michigan Gaming Control Board, are reassessing the market and what bets should be available. MGCB Executive Director Henry Williams said the integrity of the industry requires “proactive safeguards designed to detect and deter misconduct before it occurs”.

Still, Williams stressed his belief that the regulatory system in place “prioritises transparency, accountability and consumer protection”.

Former New Jersey governor Chris Christie, who was the lead plaintiff in the 2018 PASPA case, wrote in an essay for The New York Times that legal sports betting strengthens integrity.

Iden said any discussions with lawmakers will likely be positive, because it will help them understand that the increase in legal sports betting and illegal activity is not the correlation it might appear to be.

“Too many lawmakers don’t understand how it works. It’s not a negative, just a fact,” Iden said, explaining sports betting is not a topic national lawmakers prioritise. “They want to be involved. They see headlines that there might be something there. We’ll see some committee hearings where leagues get up and provide public testimony.

“It’s a regulated system that works and it will likely happen again. If athletes continue to commit crimes, they’ll be uncovered. [Legal] sports betting is something that didn’t exist, and now it exists, and we’re uncovering nefarious activity that already existed.”

National framework unlikely to move

Lawmakers on Capitol Hill have filed numerous gambling-related bills over the past several years, but Congress has shown little interest in taking any up. That includes the SAFE Bet Act, first introduced last year by two Democrats, Paul Tonko in the House and Richard Blumenthal in the Senate. The pair held an event this month highlighting the human impact of sports betting.

“In order to truly address this rising crisis, the federal government must act to establish minimum safety standards. I’ll continue to highlight the importance of this issue to my colleagues and push for this common-sense legislation,” Tonko said in a recent statement to iGB.

State lawmakers and regulators are in a better position to alter existing laws and regulations. Ohio Governor Mike DeWine, who signed the law legalising sports betting in the Buckeye State, recently expressed regret about it to the Associated Press. DeWine also said the recent limits agreed to on MLB microbets do not go far enough. While he knows the votes to repeal sports betting in Ohio do not exist, he said he would sign a bill sent to him to do so. Lawmakers have filed bills in Maryland and Vermont to repeal their laws, but they did not advance.

One reason industry stakeholders are doubtful anything moves at a nationwide level is the divisive partisanship in Washington. When the initial NBA scandal broke last month, Congress was in a record-long shutdown.

“We have to put into perspective that we have a Congress that is basically not functional, and it’s not even functional when they have a government that’s funded,” one industry source told iGB. “There will be some congressional discussions. What that leads to in terms of federal solution, I think it’s unlikely in the near term.”

With Texas lawmakers only convening in odd years, 2025 was a pivotal point in Sands’ expansion efforts. Sands’ controlling shareholder, Miriam Adelson, quadrupled her lobbying spend for this year’s session compared to 2023. Sands’ longtime government relations chief Andy Abboud told iGB in October 2024 that the chances of Texas gambling expansion were “greater than 50%”.

Lawmakers weren’t swayed, however, and any notion of legalising either casinos or sports betting was never considered. Sands’ highest-backed state Senate candidate also failed to even reach a run-off. Additionally, recent lottery scandals in the state have turned some officials further against gaming than before, and upcoming races for attorney general and lieutenant governor don’t look promising for the industry.

All of these developments have yet to deter Sands’ Texas casino dream. The company is again embarking on media campaigns, this time proclaiming that it could replicate its world-class Singapore resort Marina Bay Sands in the heart of the Lone Star State.

At the same time, Sands has this year given up hopes for a New York casino and abandoned its short-lived digital arm. Why, then, is Texas so enduringly attractive despite the lack of progress?

Texas has biggest pool of untapped population

The simplest explanation as to why Sands is still bullish on Texas is population. Its most recent estimates surpass 31 million residents, second only to California. The next most populous states, in order, are Florida, New York and Pennsylvania.

California and Florida are prohibitive to Sands, as both are markets where Indian tribes have exclusivity for Class III gaming. The company deemed New York to be unattractive due to the looming possibility of legalising iGaming, which is already legal in a Pennsylvania market crowded with all forms of gambling plus unregulated skill games.

Texas is both commercially untapped and conservative with gambling expansion, a perfect combination for a retail-only operator willing to make big investments.

“Looking at the US in general, Hawaii, Utah, downstate New York, Georgia and Texas are really the only greenfields left,” said Gene Johnson, executive vice president at consultancy Victor Strategies. “Texas is the biggest plum on the tree because of the lack of alternatives right now for the huge population and economic demographics.”

Johnson suggested that for Sands, the years of toil could be more than repaid by securing any kind of first-mover advantage. He surmised it’s “probably better to get half the pie in Texas” than a small slice of an existing or less attractive market.

Previous analysis from The Innovation Group estimated that the Texas casino market could generate $2.5 billion to $3 billion in annual tax revenue.

Market perhaps not as reliant on international traffic?

Another factor that could work in Sands’ favour is the idea that the Texas market might not be as reliant on international tourism as places like Las Vegas, Singapore and New York. Las Vegas stakeholders in particular have seen the headaches that a dip in international visitation can cause. Texas’ extensive population, which does have wealth pockets in tech and oil but is mostly local, could make for a “super-regional” type of property.

“I think it’ll be a great domestic market,” said Las Vegas-based consultant Brendan Bussmann of B Global Advisors. “Not just from pure population centres like Dallas and Houston, but also what you’re attracting from a regional setting.”

For years, neighbouring gaming states like Oklahoma, Louisiana and New Mexico have profited immensely from Texas’ lack of gambling expansion by welcoming Texans across their borders. If the state were to legalise its own offerings, some of that outbound traffic could stay local.

Bussmann guessed that a Texas casino could see domestic traffic rates of 92%-93%. There are no current comparisons to that sort of scenario, he said, but returns could be “exceptional” if major players like Sands get the green light.

Johnson noted that there are some international opportunities, but overall “the bigger opportunity is for the domestic customer, all this population in the Dallas-Fort Worth area and the Houston area, which you could serve with a very large integrated resort”.

Potential regulatory environment still very unclear

Perhaps the biggest unknown about a potential Texas casino market is the regulatory environment it would operate under.

Given how staunchly state officials have opposed gaming, it seems hard to imagine that the sector would be granted favourable regulatory conditions if it is legalised. But with limited competition, those factors might not be as important for Sands as it would be in other markets.

Johnson surmised that Texas casinos would face a “tolerable” environment, though Sands might be “willing to risk a pretty high tax rate” in exchange for growth opportunities. In Nevada, casinos face a tax rate of 6.75% but there is ample competition. New York has yet to issue licences for its pending downstate casinos, but the three finalists will see tax rates of at least 25% and 10% for slots and tables, respectively.

For Bussmann, the more important issue is crafting a message that resonates with lawmakers to even get the conversation moving in a positive direction, which has yet to happen. It may take more than one voice to get the ball rolling, a concession Sands might be loathe to relinquish.

“There’s a way to get this done, but it has to take a multi-pronged approach, not just a one-solution opportunity,” Bussmann said. “You need multiple operators coming in and saying, ‘Here’s a pitch,’ as opposed to, ‘Here’s one, and we’re gonna do everything we can to get it’. I just think you need multiple parties in the process to give different perspectives.”

However, despite these frequent interventions, breaches persist. The pattern raises a difficult question: why does non-compliance remain so endemic? The answer seems to lie in a complex mix of regulatory evolution, operational shortcomings and commercial tension between growth and governance. 

The numbers give an indication. A conservative estimate is that the total annual fines for regulated non‑compliance in the European gambling sector lie above €150 million per year. Spain is a leader among the European countries, both in number of non‑compliance cases and aggregate fines issued in recent years. The Spanish regulators imposed €142.7 million in fines on gambling and online gaming operators during 2024. 

According to Vixio’s AML Fines Outlook, regulators across Europe imposed more than €36 million in AML-related penalties alone between March 2024 and March 2025, underscoring the sector’s struggle to meet compliance standards that are tightening by the month. 

What’s happening across Europe?

In Britain, the Gambling Commission remains an assertive enforcer. Between April 2023 and March 2024, it issued £7.16 million in fines. Then for the period 1 April 2024-31  March 2025, the commission’s annual report revealed enforcement action against 24 operators led to £4.2 million in fines or regulatory settlements. A new seven-step process to calculate financial penalties was introduced by the Gambling Commission in October. They will now be based on a percentage of the offender’s gross gambling yield.  

In the Netherlands, the Kansspelautoriteit (KSA) introduced a tougher fining matrix for 2025, where Category 5 violations now carry penalties of between €2 million and €4 million. Last year, Malta-based online casino Gammix Limited was fined €19.7 million for unlicensed operations, one of the largest penalties ever imposed by a European regulator. 

Elsewhere – from Malta to Finland and Denmark – regulators are taking similar tough stances against regulatory non-compliance. Belgium’s Gambling Commission, for its part, handed out a record €4.6 million in fines last year. And in Italy, the regulator ADM imposed €1.35 million fines in advertising-rule breaches. 

Some industry stakeholders warn the black market will be the only beneficiary if enforcement becomes disproportionate relative to revenue. Regulators, however, counter that deterrence requires precisely that degree of financial sting. 

Compliance or competition? 

Industry observers note the longstanding compliance dilemma stems from competing imperatives. Regulatory requirements are complex and there is a tension between delivering commercial performance and meeting compliance obligations. 

“It is clearly obvious that the bar has been raised by regulators both in the UK and across Europe. The sharp increase of regulatory action we are witnessing, particularly around AML and social responsibility, paints a picture that all may not be as it should be in the regulated market,” says Victoria Reed, chief executive of Better Change. 

This friction is particularly acute in markets where margins are tightening. Melanie Ellis, a partner at Northridge Law in London, argues that investment in compliance infrastructure often competes with initiatives that promise faster returns. “The cost of compliance has increased massively. Operators are unable to divert sufficient funds to this function. In the UK, this particularly relates to the increased expectations in relation to customer monitoring and action.” 

She explains how it has become difficult to meet the GC’s expectations without significant investment in both software and personnel, particularly to enable immediate responses to indicators of money laundering or harm. 

That challenge is further complicated by demographic shifts – especially the rise of younger, digital-native gamblers – that put further pressure on operators to deliver seamless, instant experiences without breaching consumer-protection thresholds. 

Reactive to predictive

Britain’s Gambling Commission has sought to evolve from reactive enforcement to predictive oversight. Andrew Rhodes, its chief executive, told industry representatives at a briefing in November that nine operators had been suspended in recent weeks for “issues that we have repeatedly warned about – software provision and self-exclusion”. 

The commission’s new approach to non-compliance relies heavily on real-time monitoring through its Regular feed of Operator Core Data (ROCD) “Over 73% of last year’s consumer-protection assessments were rated good or satisfactory,” Rhodes explained. 

He credits the ROCD with allowing regulators to spot behavioural risk clusters – such as younger players who seldom set deposit limits yet reach thresholds of financial harm. The GC hopes this analytical capability will pave the way for “a truly risk-based regime”. 

Signs of progress 

Despite the headlines that non-compliancy makes in mainstream press, not everyone sees an unmitigated compliance crisis. Richard Williams, a specialist gambling, licensing and regulatory lawyer at Keystone Law, believes operators have made tangible progress. “If you go back five years and look at AML and social-responsibility compliance then versus now, the change has been huge – particularly around intervention when people are losing large amounts of money. Operators are far more responsible,” he says. 

The GC’s evolving stance also reflects a wider trend toward collaboration rather than confrontation. “We recognise there will always be tension between regulator and regulated,” Rhodes says. “But it doesn’t have to be adversarial. Working together productively has delivered progress.” 

Williams notes that regulators increasingly prefer structured action plans to outright licence reviews. “If improvement isn’t shown, then suspension or revocation can follow – but that’s becoming rarer,” he says. “It’s now more about raising standards than simply sanctioning operators.”

Non-compliance a fault of global expansion 

Nevertheless, non-compliance remains a concerning issue. Tamsin Blow, a lawyer at CMS London, observes why instances continue to occur: “Enforcement often results from operators grappling to understand and keep on top of multiple differing legal systems across jurisdictions, balancing parallel — and sometimes competing – obligations under AML, social responsibility, data protection and equalities law.” 

Breaches, in most cases, are not deliberate. “I’m sure it happens occasionally,” says Williams, “but I think it’s rare. If you look at the size of fines, which are often in the millions, and when you add legal fees, audits and licence conditions, it’s generally not profitable to be non-compliant. Most responsible operators don’t intend to breach rules.”  

According to Williams, the high number of compliance cases in the UK is a reflection of a particularly vigilant regulatory body. “Regulators in other markets doing only a handful of checks each year will naturally find fewer breaches.” Operators are being squeezed by rising duties, taxes and levies, he points out. “That pressure creates real challenges.” 

The Dutch toddler 

Taking a quick glance across Europe, if Britain represents regulatory maturity, the Netherlands is still finding its footing. Bjorn Fuchs, chairman of the Dutch trade body VNLOK, likens the market, which opened only four years ago, to “a toddler with a steep learning curve”. 

“The speed with which the bar has been raised, combined with multiple possible interpretations, can lead to misunderstandings, loss of oversight and sub-par execution,” he says. Operators, he adds, face heavy fines for responsible gambling lapses, particularly in self-exclusion and deposit-limit enforcement. 

Fuchs worries that “when regulatory burdens grow exponentially fast and become disproportionate, the legal market as a whole is at risk”. Still, he insists that genuine errors should be seen as part of a maturing ecosystem, not disregard of rules: “Operators that knowingly and structurally aren’t compliant should lose their licence to operate.” 

In Norway, where gambling remains a state monopoly, compliance takes a different form. Carl Fredrik Stenstrom, secretary-general of the Norwegian trade body NBO, says that “being the last-standing monopoly means the operator is under intense scrutiny. Even minor deviations are highlighted.” 

That scrutiny intensified after PwC’s 2025 audit of Norsk Tipping found “poor control and unclear leadership”, with excessive emphasis on innovation over quality assurance. For Stenstrom, the episode reveals that even monopolies are vulnerable to governance drift. “It’s very interesting that PwC issued such criticism for a monopoly company, which is supposed to just supply Norwegians with gambling products,” he notes. 

Trade bodies like NBO, he argues, are vital to maintaining accountability by providing a collective voice, engaging with politicians and communicating the industry’s perspective. He adds, too, that skilled regulators are essential. “Competent regulation ensures responsible and attractive markets.” Personal accountability for directors or turnover-linked penalties, he suggests, could complement strong institutional oversight. 

Reputational damage is another risk 

The financial cost of non-compliance is one thing, but reputational damage is another. Ellis warns: “When players, regulators or the public perceive repeated non-compliance, that can affect brand value and long-term profitability.” 

In markets such as the UK, where gambling advertising and social responsibility obligations are under constant political scrutiny, reputational harm can quickly translate into commercial risk, says Reed. “It is a huge reputational risk; we cannot portray the regulated industry as whiter than white and a safe place for people to play if the headlines continue to report huge fines as a result of failings,” she adds.  

The direction of travel, many agree, is toward data-driven, risk-based compliance. The UK’s ROCD system is a case study in how analytics can identify and mitigate risks. Similar approaches are emerging elsewhere: Sweden’s Spelinspektionen now ties fines to turnover, while the KSA in the Netherlands is experimenting with behaviour-based enforcement triggers. 

For operators, the challenge is to move to predictive oversight embedded in everyday operations. As Reed puts it: “The better operators understand the patterns regulators are monitoring, the better they can align their business practices and protect consumers – which benefits the industry as a whole.” 

The long game 

Looking ahead, Williams sees progress hinging on two fronts: “AML and social responsibility failings are often the same in not properly establishing a customer’s means or source of funds. But now there are far more mandatory limits, vulnerability checks and automated monitoring systems. Technology and machine learning have reduced human error, which was often the weak point.” 

He is skeptical about EU-wide harmonisation. “Each regulator wants its own rules. Harmonisation makes sense in principle, but in practice countries approach it differently.” 

Meanwhile, Blow believes enforcement has already peaked in Britain: between 2018 and 2023, annual enforcement cases ranged from 15 to 23; in 2024, they fell to around a dozen. “The market and the clarity of the regulatory regime have matured,” she says. “We may now see similar developments across Europe as other markets evolve.” 

Ellis adds that infrastructure will matter more than ever going forward. “Investment in compliance infrastructure would have the biggest impact on reducing non-compliance,” she says. “Unfortunately, this will be increasingly challenging if tax rates rise. Effective communication of expectations by regulators is also crucial.” 

Bjorn Fuchs argues for better balance: “The most effective lever for reducing recurring fines is a combination of strong accountability for operators and an effective dialogue between legislators, regulators and the industry.” 

After a decade of explosive growth and sporadic governance, Europe’s iGaming sector is learning that compliance must be built into the business model, hoping that compliance will shift from being a recurring headline to a quiet constant. Until then, the penalties – financial, operational, and reputational – will keep the conversation alive. 

Several weeks after Truth Social disclosed plans to launch Truth Predict, a new prediction market platform, a Senate committee grilled Michael Selig on the controversial topic Wednesday. Asked by Senator Elissa Slotkin, D–Michigan, how he will respond if Trump advised him to design a carveout for Truth Predict, Selig indicated that he plans to follow the letter of the law in the applications process.

Selig, who is Trump’s second pick to chair the US Commodity Futures Trading Commission, made the comments at his confirmation hearing before the Senate Committee on Agriculture, Nutrition, and Forestry. Crypto.com, which will partner with Trump Media on the platform, received CFTC approval in September to hold a designated contract market licence.

In response, Selig stated that he will always “uphold and stick to the law”, adding that if President Trump remains in compliance with requisite ethics rules and submits an application, he would go “through the same process as everyone else”.

If confirmed, Selig will become the seventh chairman of the CFTC since 2000. The CFTC was established through the Commodity Exchange Act, a 1936 federal law that regulates commodity and futures trading.

The committee narrowly approved Selig’s nomination on Thursday afternoon. Selig advanced by a 12-11 margin, on a vote along party lines. Brian Quintenz, Trump’s previous nominee, testified before the Senate over the summer, but the nomination did not advance out of committee.

Latest moves by sports betting market leaders

The committee held the confirmation hearing on the heels of announcements by the nation’s two largest sportsbooks that they will roll out sports prediction markets in select states. The impending launches by FanDuel and DraftKings could raise the temperature in a heated battle on states’ rights versus federalism in the regulation of sports event contracts.

Both companies outlined plans to debut prediction markets on recent earnings calls. Following its acquisition of Railbird Exchange, DraftKings said on 8 November that it plans to launch a prediction market offering in the coming months. Days later, Flutter announced that it will offer sports event contracts on its new prediction market site, FanDuel Predicts. The offering will be available through Flutter’s partnership with CME Group.

As traditional sportsbooks prepare for their leap into prediction markets, the operators have cut ties with the nation’s largest lobbying group for the gambling industry. Both companies announced Tuesday that they are leaving the American Gaming Association, a casino trade group that opposes the proliferation of prediction markets.

HoldCrunch founder Tom Johnson discussed the impact of the impending launches this week in a meeting with Truist Securities analyst Barry Jonas. Although the listings in non-sports betting states will put FanDuel and DraftKings on the map, Johnson views the competitive landscape as an “open playing field,” with established companies such as Kalshi.

Also this week, CME Group issued a memo detailing the launch of several sports event contracts. Pending CFTC regulatory review, Chicago Mercantile Exchange, Inc. plans to list contracts on pro football, college football and pro basketball starting 6 December.

CFTC nominee punts to the courts

Selig, who serves as the chief counsel of the SEC’s Crypto Task Force, is in favour of principles-based regulations that will protect consumers from fraud and manipulation. While the committee spent a large portion of the hearing seeking his views on the regulation of crypto spot markets, he fielded several questions on sports event contracts.

The most heated exchange occurred during a line of questioning from Sen. Adam Schiff, D–California. One rule, CFTC Regulation 40.11, prohibits event contracts that violate a so-called public interest test, including those pertaining to war, assassination, terrorism and gaming. However, advocates of sports event contracts have a differing view on the treatment of the contracts.

Josh Sterling, an attorney who has represented Kalshi, has argued that while the activities are enumerated in the act, they are not expressly “illegal”. Speaking at a gambling industry event in July, Sterling stated that the activities are subject to review on whether they are contrary to the public interest.

Schiff criticised the CFTC for its failure to issue guidance on whether sports event contracts violate existing regulations. He also pressed Selig on whether contracts that involve “gaming” are in violation of federal law.

“These are questions for the courts,” Selig replied. “They are really complicated issues of interpretation.”

Further discussion on sports event contracts

Schiff was not the only committee member to address the topic at the hearing. Several others, most notably Democratic Senators Cory Booker of New Jersey and Amy Klobuchar of Minnesota, broached the subject. When asked to expound on the legality of sports event contracts, Selig noted on at least six different occasions that he will defer to the courts on the matter.

Booker, a former football player, spent a portion of his time discussing the sports betting scandals that rocked the industry in the last month. He credited several regulated sportsbooks for detecting suspicious activity that led to a slew of criminal charges. “Given these recent events, it’s all the more concerning that sports event contracts are being offered without the same monitoring,” he said. Kalshi maintains a partnership with integrity monitor IC360.

Klobuchar, the committee’s ranking Democrat, asked Selig if the CFTC has ample resources to regulate the new markets. The nominee replied that if confirmed, he will take a close look at the agency’s resources to ensure that it has enough to fulfill its mission.

Dina Titus, a congresswoman from Nevada who co-chairs the Congressional Gaming Caucus, also weighed in. In a statement posted on X, Titus wrote:

“CFTC regulations clearly prohibit event contracts based on gaming, and as such, the agency must crack down on platforms that improperly offer event contracts on sport outcomes. Failure to enforce these rules not only infringes upon the rights of states and tribes but also undermines market integrity and consumer protection in the games the public enjoys.”

Vote on CFTC nominee Thursday

Truth Social, an alternative social media platform, is owned by Trump Media & Technology Group. Before returning to office for a second term as president, Trump insisted that he would not sell his stake in the company. While Trump initially held a 52% stake estimated to be worth at least $2.3 billion, the company issued new shares that diluted his stake to about 41.5%.

Trump’s refusal to divest his stake has been met with criticism among some leading ethics groups. Citizens For Responsibility & Ethics in Washington urged Trump to divest his shares following his 2024 victory, citing the influence foreign governments could exert through investments in the company. The president disclosed several stock transfers in Trump Media over the summer in a 234-page list of public financial disclosures with the US Office of Government Ethics.

Truth Social is on track to become the first social media platform to launch a predictions market. Trump Media did not respond to a request from iGB for comment.

Brazil has captured much of the gambling sector’s interest this year after regulation launched on 1 January, with a number of international giants entering the market.

One such company was Flutter, which created its new Flutter Brazil business after acquiring a 56% stake in NSX, the parent company of Brazil-facing brand Betnacional.

That deal was concluded in May and, in Q3, Flutter achieved $87 million in revenue from its Brazil venture. This was 412% higher than the $17 million it generated in the same quarter last year prior to the completion of the NSX deal, which largely came from its existing Betfair business.

But while Betnacional achieved record iGaming revenues in Q3, excluding M&A Flutter’s revenue during the quarter was actually down 18%, which Flutter attributed to the fact that Betfair Brazil was still continuing its recovery from the friction derived from the re-registration required at the start of regulation in January.

Despite the Betfair struggles, Flutter CEO Peter Jackson remains confident the company will succeed in Brazil.

“Brazil is an exciting growth opportunity for Flutter and we retain a strong conviction that scale operators with the best products will win the largest share of the market,” Jackson said in the Q3 report.

Entain hampered by poor sports margin

Entain, meanwhile, enjoyed a successful transition to the regulated market with its Sportingbet brand, reporting a 21% year-on-year NGR rise in Brazil during H1.

But Q3 was a different story, with NGR in Brazil down 11% despite 14% volume growth.

Entain deputy CEO and CFO Rob Wood put this down to “genuine bad luck from sports results”, stating the company is still trading on the right side of expectations when it comes to volume.

He expects sports margin to normalise over time, with the volume growth demonstrating why Flutter continues to be enthused about its future in Brazil.

It’s not just sports betting where Entain struggled during Q3, however, with Wood saying slow game authentication has hampered the company’s iGaming efforts in Brazil.

“iGaming is not particularly strong at the moment and all the growth is coming from sports,” Wood said on the earnings call. “We think this is a market-wide phenomenon, not just Entain.

“The good news is we think there’s a lot more growth to come out of gaming as we look forward. But so far in 2025, it’s been slow.”

BetMGM investing heavily in Brazil

Last August, MGM Resorts International struck a partnership with Grupo Globo, LatAm’s largest media group, to introduce the BetMGM brand to the Brazilian market as a joint venture.

The company has stated on a number of occasions that it is aiming to reach 10% market share in Brazil, and it reiterated this target in its Q3 presentation.

MGM achieved “strong growth” in Brazil during Q3 without giving direct figures. The company is focused on efficiently building brand awareness and customer acquisition, powered by its on-the-ground team led by MGM Brazil CEO Almir Ribeiro.

However, MGM Resorts International CFO Jonathan Halkyard said the company’s heavy investment in Brazil will likely lead to MGM Digital reaching an EBITDA loss of close to $100 million for the year.

Halkyard explained the company’s investment is in line with its roughly 50% stake in the JV, which is already showing positive signs.

“The venture has seen encouraging growth quarter-over-quarter throughout the year in active players, deposits and GGR,” Halkyard said on the company’s earnings call.

Record LatAm casino revenue for Betsson in Q3

Betsson continues to make significant efforts in LatAm, launching in Brazil and Paraguay during 2025 to add to its existing markets which include Argentina, Colombia and Peru.

It is proving a successful venture, with Betsson achieving year-on-year revenue growth of 10.2% to €76.5 million in LatAm over Q3.

This was powered by record casino revenue in the region, rising from €46.1 million in Q3 2024 to €56.6 million in the same period this year.

Casino growth helped to offset a year-on-year drop in sportsbook revenue from €23.1 million to €19.8 million. Betsson put this down to tough comparisons with last year’s Q3 which included the European Championship and Copa America football tournaments.

LatAm accounted for 26% of Betsson’s revenue in Q3, down from 28% in Q2.

Betsson CEO Pontus Lindwall pointed to Argentina, Peru and Colombia as key areas of focus, with the former continuing to show strong underlying growth in terms of deposits and turnover.

Codere Online positioned to become a leading player

Codere Online is currently operating in the LatAm markets of Mexico, Colombia and Panama, as well as certain provinces in Argentina.

Its current total addressable market (TAM) is €4.8 billion, although it noted in its Q3 presentation the combined TAM of online expansion markets, which includes Brazil, Peru and Uruguay, could be €8.4 billion by 2029.

In the presentation, the company said: “Codere Online is especially well positioned to become a leading player across the region.”

Mexico continues to be Codere Online’s biggest market, achieving market revenue of €26.8 million in Q3. This is ahead of the €22 million generated in its home market of Spain.

However, with Mexico’s government weighing up increasing the gambling tax rate from 30% to 50%, Codere Online said it may have to reconsider its investment into the market.

Outgoing CFO Oscar Iglesias, who will shortly be replaced by Marcus Arildsson, expects the tax to come in from 1 January.

“The discussions around capital allocation, I think, is a broader one, and it’s in the context of the discussions we’re having at the board level,” Iglesias told analysts.

“The tax obviously factors into … our appetite and willingness to invest into the market because it has an impact on the unit economics, the flow-through of every dollar of NGR to EBITDA in the business.  

“It’s still a little bit early to say what that means in terms of our plans for next year to invest in Mexico.” 

Codere Online is also working under the assumption that the 19% VAT in Colombia, which is set to end from the start of 2026, will be renewed.

Codere Online Executive Vice Chairman Moshe Edree explained the operator’s short- to mid-term strategy “does not include Colombia”, echoing CEO Aviv Sher’s post-Q2 comments that the company was pulling back in the market.

RSI confident Colombia VAT won’t be renewed

But while Codere Online is expecting the VAT to be renewed, Rush Street Interactive CEO Richard Schwartz said on the company’s post-Q3 earnings call that the business is predicting the tax will be scrapped.

Rush Street Interactive followed many other operators in absorbing the tax through player bonusing. This meant in Q3, while GGR from Colombia grew over 50%, net revenue was down 27%. Revenue across LatAm fell 11%.

Despite this, Rush Street Interactive believes it holds second place in Colombia, while it also claims to be among the top seven operators in Mexico.

Monthly active users in LatAm during Q3 were up 30% year-on-year to around 415,000.

Rush Street Interactive listed Brazil, Ecuador, Argentina and Chile as potential expansion opportunities.

When asked on the earnings call whether the situation in Colombia may dampen the company’s interest in further LatAm expansion, Schwartz responded by saying the company was still excited by the region.

“We believe those markets are at the infancy of growth,” Schwartz said. “And as we see in our growth ourselves, there’s lots of opportunity there, and it’s a very large population across Latin America that are in the process of or will be legalising online gaming in the future. So we certainly remain very excited for it.”

Kambi lowers FY2025 guidance due to slow Brazil progress

In its Q3 report, Kambi announced it was lowering its full-year 2025 guidance from an adjusted EBITDA of €20 million-€25 million to approximately €17 million.

The company said this was in part down to the Brazilian market developing more slowly than expected, with CFO David Kenyon stating the company isn’t seeing the growth in Brazil it had “hoped for”.

Kambi CEO Werner Becher said on the earnings call that while the Brazil market is continuously growing, he believes the overall pre-regulation market size was overstated.

“There’s a little bit of disappointment, I would say, in the entire industry about the Brazilian market,” Becher claimed.

“The legalised regulated market grew slower than expected because the black market is still very big there.”

Estimates suggest global annual esports betting revenue will have reached $2.8bn by the end of this year – a 12% year-on-year increase and more than double the figure of just four years ago. Next year, the total is projected to surpass $3bn.

This sharp growth in the 2020s has led to an inevitable increase in regulatory scrutiny. However, the relatively nascent nature of the vertical has left many watchdogs playing catch-up. 

In many jurisdictions, there is a lack of regulatory clarity that appears to be borne out of an intrinsic lack of understanding of esports, as well as esports betting. Nowhere is this more apparent than in the US. Despite the growing popularity of esports, traditional sports wagering is still legal in more than twice as many states as esports betting, and 19 states are considered grey states, meaning they lack specific legislation related to esports betting.

Building understanding and trust

Across the world, regulatory oversight of the vertical is still in its infancy in many territories. For esports betting solutions supplier Oddin.gg, the challenge is to work with policymakers in different regions to build understanding and ultimately trust.

“We are trying to educate regulators about what esports actually is,” Oddin.gg co-founder and managing director Marek Suchar says. “We are locally present [in different markets] so essentially our staff are on hand to address concerns in native languages. 

“The goals are different for different regulators, so we are trying to have open discussions and do the educational part at the same time as building relationships with regulators. Many times it is about addressing the mainstream perception of esports betting.”

One of the key misconceptions regarding esports is that the activity engages those under the legal age to bet. 

“There have been a lot of misconceptions around esports betting. Many of those are tied to mass media messaging.”

Whilst it is true that esports has long been touted as a vehicle to engage a younger audience, with the 18- to 43-year-old age group accounting for 87% of the activity’s betting audience, the average age of an esports bettor is comfortably above the lower threshold in regulated markets. 

For instance, the average age of an esports punter hovers between 29 years old for League of Legends and 31 for Counter-Strike – two of esports’ most popular titles. 

“There have been a lot of misconceptions around esports betting,” Suchar says. “Many of those are tied to mass media messaging – the assumption is that there is underage betting because the players themselves are underage. That is not true.

“We have run our own analysis and found that, out of the top 100 esports teams, only one would have been classified as underage. Furthermore, when it comes to underage bettors, the operators require proof of age.”

Worldwide experience

Oddin.gg provides a range of esports betting solutions spanning odds feeds, risk management, iFrame solutions, marketing and more for leading iGaming operators like Betway, Yolo Group and Aspire Global in a range of markets. This worldwide experience allows them to draw upon substantial know-how and share their learnings with operators and regulators in different jurisdictions.

“Each region has a different perception about esports betting, but the concerns are often similar,” Suchar adds. “We can usually tell regulators how we have already answered these questions in other markets, so we have the narrative prepared. 

“At Oddin.gg, we hold multiple licences across the world. In North America, for example, we are licensed in Arizona, New Jersey, Colorado, West Virginia, Ohio, and Ontario – and that gives us credibility if we start speaking to regulators in other states.

“We are basically saying, ‘look, we are already regulated across multiple jurisdictions and we work with reputable brands’. When it comes to betting, we understand the trends and we understand how the industry works.”

That understanding extends to the nuances of the esports sector, which, unlike traditional sports, does not have a universally recognised international governing body to provide ultimate oversight. 

Given the growth of esports, regulators in this vertical will likely need to move fast to keep pace with the industry. According to Oddin.gg’s Esports 2024 report, betting volume climbed sharply year-on-year, with one major title recording up to a 175% increase and average bet count rising by 131%. Total wagered amounts and average stakes also climbed across major tournaments compared to 2023, underlining the strength of the game publisher-dominated landscape.

The broader esports umbrella goes beyond games like Counter-Strike 2 and League of Legends to include fast-bet e-simulator games, which offer a completely different proposition. Understanding these distinctions is crucial not only for operators, but also for regulators seeking to design effective frameworks.

“The core esports audience for the likes of Dota 2, Counter-Strike and League of Legends is different as they have been playing and watching these games for years and are heavily invested in the games and what they bet on,” Suchar says. “Then you have a separate audience which bets on electronic simulators such as e-football and e-basketball where it is essentially these sports being played in a studio on a console.”

What’s important for operators and regulators to understand is that esports fans represent an attractive segment of the market. They are more likely to be in full-time employment and have a university degree than the general public, and nearly half earn more than $100,000 per year, according to an executive at a prominent esports team.

The importance of education

However, there is still work to be done on educating esports followers, as well as gambling regulators. It is noteworthy, for example, that one in three esports fans who do not wager on the action say they are ‘unsure how betting works’, according to iGB’s Esports Betting Report 2024.  

A step in the right direction can be taken by considering the consumption habits of younger adults, who represent the primary market for esports betting.

“When we are looking at millennials and Gen Z bettors, what is critical for them is having content on demand,” Suchar says. “If they want to watch a movie, they just go to Netflix. If they want to listen to music, they go to Spotify. If they want to consume a certain type of content, they go to YouTube.”

This ‘always on’ element is one of esports’ biggest advantages over traditional sports, which have natural breaks in the schedule and calendar throughout the day, week and year.

“With esports, they can bet almost all the time, and we have more than 15 live markets for the titles that we trade,” Suchar explains. “There are multiple opportunities to bet within each game.”

In the final quarter of last year, nearly half of all Counter-Strike bets were placed during contests, while the proportion of wagers that were props increased to 13%, showing a growing interest in the players at the heart of the competitive action.

“In sport, many of the players have a bigger following and fan base now than the teams themselves – and this trend is even greater in esports,” Suchar says. “So there are lots of reasons why bettors can come and stay engaged.”

A question of integrity

Collaboration with partners and regulators alike is a vital element of Oddin.gg’s strategic approach. With this in mind, the integrity question is one that has to be addressed openly and honestly from the outset, with the provider working closely with organisations like the International Betting Integrity Association (IBIA).

“In terms of match-fixing, robust risk management systems are in place with the right algorithms and the right personnel, so we are able to identify in real time any suspicious activity and inform our partners,” Suchar says. “On an annual basis, we see perhaps a couple of billion euros bet on our lines – and the question is, are we able to identify suspicious patterns when we look at the gameplay, like with traditional sports?

“What we see in esports is that we are able to identify those patterns, because we can analyse data from our traffic and our partners and compare it with previous events. If something is potentially suspicious, our title experts will then look into the gameplay and provide feedback to our partners on whether anything has happened that requires further investigation.

“With the tournament organisers and the integrity bodies, this is how we are trying to build confidence in the ecosystem – by showing that we are taking care and can produce a paper trail of evidence if something happens.”

“It is vital to educate regulators about how esports betting should be regulated, because they do not want it to go underground.”

Suchar is adamant that nurturing a “three-pronged partnership in terms of regulator, bookmaker and provider” is essential for success.

“Especially in a highly regulated market, this kind of collaboration is a critical element,” he adds, citing Oddin.gg’s recent work with its partners in Brazil.

“It is vital to educate regulators about how esports betting should be regulated, because they do not want it to go underground.”

Ultimately, Oddin.gg’s mission is about more than compliance. By combining technological sophistication with advocacy and collaboration, the company is helping to shape a safer and more sustainable future for esports betting.

Marek Suchar, co-founder and managing director, Oddin.gg

The campaign is crammed with evocative imagery: coin-pushers on sea promenades, bookies wedged between the chip shop and the newsagent, fruit machines with glowing buttons that evoke the warm memory of holidays. The Sun’s 8.7 million daily readers are told this is not actually about taxation, but an attack on “our way of life”. 

It is safe to say that what began as a technical fiscal recalibration has become a noisy public brawl about British culture, high-street decline and, not least, the right to personal choice and a harmless flutter. 

As Matt Chapman, The Sun’s racing columnist, writes: “By slamming the betting industry government will indirectly be telling you how you can – or in this case can’t – spend your money.” 

Farage enters culture war 

For a long time, arguments over gambling regulations and taxation have been contained among think-tanks, industry consultants and the occasional treasury committee hearing. But now the Labour government’s plan to overhaul gambling duties and increase taxes on remote gambling duties – with proposals reaching as high as 50% of gross gaming revenue (GGR) – is drawing strong reactions. 

Part harm-reduction exercise, part revenue-raising manoeuvre has collided with national nostalgia and The Sun, never shy about riding a political wave – as seen in its successful pro-Brexit campaigning in the run-up to the 2016 referendum – is very much pushing the debate. 

Protecting high-street livelihoods

The newspaper has said its campaign is a defence of punters and high-street livelihoods. This is an argument in line with that of gambling industry bodies such as the Betting and Gaming Council (BGC) who have warned of job losses of up to 40,000 and a £3 billion blow to the economy if the proposed tax hikes come into force. The sector has also been extremely vocal about high-street bookmakers facing an existential threat if a higher Remote Gaming Duty is enforced.

The Sun’s ‘Save our Bets’ activism has immediately attracted support from the right of the political spectrum, most notably from Nigel Farage, whose Reform UK party is currently the most popular party in the UK. More than a third of voters have said they would vote Reform UK if there were elections today, according to polling data.  

Farage’s constituency of Clacton-on-Sea in Essex is a seaside town that very much thrives on summer tourism – ripe with bingo halls, slot machines and gambling opportunities that play an integral part of the town’s entertainment offerings. Farage has called Labour’s tax plans an assault on British culture. He believes a betting tax hike will do nothing to help problem gamblers. 

Leader of the Conservative Party Kemi Badenoch has also spoken out against Chancellor Rachel Reeves’ plans designed to help fill a financial black hole. Badenoch accuses Labour’s “fun police” of taking a “nanny state approach” to betting, which she said could kill off the industry. 

Sun’s campaign evokes mixed feelings 

But the campaign has not been received entirely well by some within the gambling industry. “I’m uneasy about how the debate has been positioned,” says Dan Waugh of Regulus Partners, one of the sector’s most respected analysts. “This childish idea that gambling is a battle between good and evil has taken hold.”  

But Farage’s involvement, he concedes, is legitimate – he leads the most popular party in the polls after all. And as Waugh points out: “The Liberal Democrats and the Greens, for example, have developed positions that are explicitly anti-gambling. It would be worrying if none of the political parties were prepared to stand up for people who enjoy betting, bingo and horse racing.” 

Waugh does not approve of the spectacle into which policy has been conscripted. “The issues are complex,” he says. “We’re not helped by the noise.” With The Sun’s campaign and the public debate growing louder, the situation could perhaps offer a chance to improve transparency and push for more evidence-based policy. It may also give the gambling industry an opening to publicly challenge the government’s tax proposals. 

Operator support for Sun’s ‘Save our Bets’

Neal Luke, a gambling compliance consultant, says the issue is twofold. While the Gambling Commission is investing heavily in data and research, most people will never read it. What matters is how that information shapes regulation – and how clearly the public can understand what’s been considered. 

“The public will only see headlines. It’s about making sure they know what’s been considered, in plain English, from a neutral place – not a political one.” Asked what a neutral source would look like, Luke argues that today’s opinions are shaped by short-form online content, making balanced communication more important than ever. 

Among operators there is a positive acceptance of The Sun’s war on the government’s plans and of Nigel Farage’s outbursts. For Betfred’s Head of Communications Mark Pearson, the message should be about one thing only. 

“For me this is not about media framing but getting the message across that the country’s betting shops are already in a very, very fragile position. Any hit on the high street is going to close betting shops with job losses and less money going to racing and the treasury. Once betting shops close, they are not coming back,” Pearson says.  

A spokesperson for Flutter UK&I also backs the media campaign. Putting taxes up for any business is not a free hit; it has consequences, he stresses. “It’s great to see The Sun’s ‘Save Our Bets’ campaign as it gives a voice to the customer – and customers have been overlooked in the debate driven by anti-gambling groups so far this year.” 

Think tanks push back industry claims 

The “anti-gambling groups” that Flutter UK&I refers to are primarily the think tanks The Institute for Public Policy Research (IPPR) and Social Market Foundation. Both are pushing hard for a higher gambling tax. And both are heavily supported by several influential political voices, such as former Labour prime minister and chancellor Gordon Brown, who believes that the tax hike could help end child poverty in the UK, making the tax hike not merely a regulatory tool but a moral undertaking.  

“We tax cigarettes at 80%, we tax alcohol at 70%, but the online gambling tax is 21%. So there’s a big case for change. I think the gambling companies could well afford to pay a tax – and I want that money to go to child poverty,” he told Sky News. 

Dan Waugh of Regulus Partners worries that the entire debate, including the industry’s approach, has lost its anchor in evidence. And, in the end, a campaign led by a tabloid newspaper may not make things clearer. “Public debate is chaotic,” he says. “Statistics are misused across the board.” 

The most talked-about levy 

Grainne Hurst, the BGC’s CEO, attended the Reform UK conference earlier this year and was photographed alongside Farage, who in spite of popularity remains a divisive political figure. 

“It was a pleasure to lead the Betting and Gaming Council team at the Reform UK Conference this week. We had constructive discussions with senior figures in the party about the importance of a strong, sustainable and well-regulated betting and gaming sector,” Hurst wrote in a post on her LinkedIn page.  

Explaining the reason for her presence she added: “I will always stand up for our industry – one that supports 109,000 jobs, generates £6.8 billion for the economy, contributes £4 billion in tax and serves the millions of people who enjoy a bet responsibly.” 

‘Necessary lobbying’ for the sector

Waugh sees Grainne Hurst’s presence at Reform UK´s conference as a necessary part of the trade body’s lobbying efforts. “Operators should engage with a wide range of stakeholders, in my view. If anything, the industry has been far too passive in recent years in the face of an orchestrated campaign to close it down.” 

Others, who prefer not to speak on record, are less cheerful, noting that any perception of ideological capture could backfire while Labour is weighing its final tax design. What happens next will depend on whether Chancellor Rachel Reeves allows public clamour to overshadow the data on her desk.  

The government knows the gambling sector billions in tax revenue; it also knows online gambling has grown rapidly and that harms persist. It must weigh those realities against the possibility of shuttered shops, reduced racing revenue and a migration to offshore operators. 

For now, the noise grows as The Sun has succeeded in making gambling tax the most talked-about levy in Britain. Whether this results in better policy in the eyes of the industry – or simply more polarisation – remains to be seen. 

Christie, a former New Jersey governor, served as the lead plaintiff in the 2018 PASPA case, one that led to the largest expansion of legalised sports betting in US history. Following 2017 oral arguments before the Supreme Court, Christie argued on the famed steps that the federal government overstepped the Constitution with its 1992 ban of sports gambling.

Now, as players from the NBA and MLB are facing a slew of criminal charges in connection with match manipulation, Christie contends that the system is working. The players are among more than three dozen defendants charged by the US Attorney’s Office of the Eastern District of New York in a sweeping illegal poker-sports betting case. Last week, Christie went on a media blitz to double down on his position.

In stating his claims, Christie wrote in a guest essay for The New York Times that when it comes to “ensuring the integrity of sports”, legal betting has achieved more in seven years than “prohibition did for decades before”.

Concerns about sports betting integrity

Last month, two days after the start of the NBA regular season, prosecutors from the Eastern District named 38 defendants in the comprehensive case, including three figures from the NBA. Among them are Miami Heat guard Terry Rozier, who is accused of deliberately underperforming in several statistical categories to ensure the outcome of a prop bet. Interim US Attorney Joseph Nocella Jr. described the case as the largest investigation of the sports betting market since the PASPA decision.

The Rozier case and others are not signs of a “system in crisis”, Christie wrote, but rather confirmation that proper mechanisms are in place to “catch the cheating”.

In response to the indictments, the US House Committee on Energy and Commerce wrote a letter to NBA Commissioner Adam Silver seeking information on the actions the league plans to take to limit the “disclosure of non-public information” for betting purposes. The committee is examining allegations of illegal gambling and sports rigging that resulted in “tens of millions of dollars in fraud, theft and robbery”, according to the letter.

The allegations raise “serious concerns about sports betting and the integrity of sport in the NBA, which harms fans and legal sports bettors”, stated the letter from congressmen Brett Guthrie of Kentucky and Frank Pallone Jr of New Jersey.

Tonko: Voluntary self-policing has failed

Since PASPA’s repeal, leading proponents of the regulated markets have called on the US Justice Department to crack down on betting in the offshore black market, where Americans still wager billions per year. Still, some argue that offshore sites maintain guardrails on betting that legal apps do not offer.

One insider, who spoke with iGB on Monday, said the limits for player props, if offered at all, are very low on the offshore sites. By comparison, the defendants in the current case allegedly placed five-figure wagers on a litany of props.

Representative Paul Tonko of New York has also contacted the NBA to express his discontent with the uptick in criminal allegations. Tonko, co-author of the Supporting Affordability and Fairness with Every Bet (SAFE Bet) Act, has sought to establish a federal framework for the legal sports wagering market. Alarmed by the criminal accusations, Tonko contends that professional sports leagues have prioritised commercial partnerships with gambling operators over integrity.

“Claims of prioritising integrity ring hollow when leagues have sold credibility to gambling operators, integrated betting content into broadcasts, normalised wagering for teenagers, glorified it in advertising, and then failed to prevent criminal conduct from taking hold within the sport,” Tonko wrote in a series of letters to Silver and six other commissioners.

Tonko took it one step further, contending that the reliance on “voluntary self-policing” in the legal sports betting industry has failed. If the integrity of professional sports depends on federal law enforcement alone, the current system is already broken, Tonko mused.

“The choice before you is now explicit. Either engage directly with Congress to establish mandatory federal guardrails that restore integrity and protect the public, or stand in opposition and accept responsibility when the next scandal breaks and more families and lives are destroyed,” he wrote.

Pitch-by-pitch wagering

However, Christie countered concerns about integrity in his pointed op-ed piece, as he enumerated the detection capabilities at the disposal of sportsbook operators. In using sophisticated high-tech software, several sportsbooks detected unusual betting patterns in recent cases and flagged them to regulators, Christie wrote.

The former New Jersey governor also discussed the transparency of the regulated market in an interview on ESPN with Stephen A Smith. In the poker matter, three New York mob families backed the rigged games, then took a cut of the action, prosecutors allege. If an organised crime family detects illegal sports betting activity, it is foolish to believe that they will “pick up the phone” and call NFL Commissioner Roger Goodell, or his counterparts at the NBA and MLB, Christie argued.

After the NBA case broke, a judge unsealed further indictments that resulted in the arrests of two pitchers from the Cleveland Guardians. The MLB pitchers, Emmanuel Clase and Luis Ortiz, are accused of conspiring with gamblers to rig the outcomes of pitch-by-pitch betting props. The bettors won approximately $450,000 on the wagers in question, including roughly $38,000 on a single pitch from Clase, according to prosecutors.

“Regulated betting didn’t create these integrity issues, it has revealed them,” Christie stated.

NBA launches internal investigation

One defendant in the recent NBA sports betting case, former guard Damon Jones, has ties to the Los Angeles Lakers. A close friend of LeBron James, Jones served as an unofficial assistant on the Lakers’ bench in 2022-23. Jones is accused of disseminating non-public information of a James injury to a bettor, who capitalised on the inside info. Jones has pleaded not guilty to several felony charges related to the gambling probe.

The NBA has hired an independent law firm to investigate the allegations in the indictment. Multiple teams have been approached by investigators, including the Lakers, ESPN reported. In addition, a Lakers assistant trainer and an executive administrator voluntarily gave up their phones to investigators, according to The Athletic.

“As is standard in these kinds of investigations, a number of different individuals and organisations were asked to preserve documents and records,” the NBA wrote in a statement. “Everyone has been fully cooperative.”

Former college player admits to point shaving

On Monday, former University of New Orleans guard Cedquavious “Dae Dae” Hunter admitted that he manipulated the outcome of several games in the 2024-25 season. Appearing on ABC’s “Good Morning America”, Hunter explained that he devised code words with a teammate to indicate that they planned to shave points.

Hunter also admitted that he previously lied to NCAA investigators about his participation in the scheme. Investigators from the NCAA also determined that players from Arizona State and Mississippi Valley State allegedly took part in separate point-shaving schemes.

“I just had a child, and the school wasn’t paying me money,” Hunter said. “ I was trying to get money to actually take care of my child.”

While several defendants from the federal case based in Brooklyn have reportedly been tied to the college point-shaving scandal, Nocella said his office is not investigating the college probe.

Christie, meanwhile, appears to discourage the federal government from intervening in the legal sports betting market.

“New Jersey has built a system that doesn’t just collect taxes, it builds trust,” he wrote. “There’s no denying that sports betting is more visible than it was a decade ago – that’s by design. Legal markets bring sunlight, they create standards and they bring better accountability.”

Rival supplier Playtech was, in October, unmasked in US court filings as the client behind a covert campaign that had employed the Israeli intelligence firm Black Cube to produce and circulate a defamatory report accusing Evolution of trading within black markets.

The dispute has all the ingredients of a boardroom thriller: disguises, fake identities, hidden cameras and dossiers couriered to regulators. Yet beneath the surface lies a more immediate concern for investors: what do the claims and some of the report’s findings mean for Evolution’s valuation, reputation and ability to sustain shareholder confidence? 

Immediate impact

The case traces back to December 2020, when Playtech contracted Black Cube to craft a report designed to damage Evolution’s standing in the US and European markets. Black Cube’s findings came to a close in November 2021 in a complaint filed with the New Jersey Division of Gaming Enforcement, which alleged that Evolution’s games had been deliberately supplied in jurisdictions under US sanctions, such as Syria and Iran.  

However, according to court filings, Black Cube’s methods were elaborate and ethically dubious as agents posed under false pretences, secretly recorded current and former employees of Evolution and cherry-picked evidence. Depositions revealed that Black Cube’s co-founder, Avi Yanus, was promised a six-figure success fee for achieving specific outcomes.

Evolution’s statement claimed that the New Jersey Superior Court deemed Black Cube’s report “objectively false”, however the court’s February 2025 ruling said, “this court is not making any dispositive finding with regard to the merits of Plaintiffs’ case.” It therefore deemed the case to still be in its infancy. 

Evolution’s public release, which broke the news on 21 October, portrayed Playtech in a particularly nefarious light. The release described Playtech’s actions as a “smear campaign” and “a defamatory scheme”. The statement also described the Playtech-commissioned report as “highly inflammatory”, intended to “substantially harm” Evolution. The immediate market impact was felt by Playtech as its share price plummeted between 25% and 38%, reflecting investor concern over its role in commissioning the investigation.

The gaming giant’s share price bounced back in the couple of days following Playtech’s public response to Evolution, also released on 21 October.

Short-term PR bruise or long-term credibility at risk?

Evolution’s share price, by contrast, held steady or even rose slightly upon the release of its statement, signalling the market’s initial support for the Swedish company.

Ben Robinson, managing partner at Corfai Capital, interprets the market response as a reflection of the companies’ different roles, as portrayed in the court filings. He also highlights Evolution’s image within the media coverage, compared to Playtech.  

“The market punished Playtech, while Evolution held steady or rose slightly. The street clearly saw Evolution as the target, not the culprit,” he notes. “The 2021 dossier probes closed in February 2024 with no action, blunting the claims and capping further downside unless new facts emerge. Headlines could still sting, but this looks priced in, a short-term PR bruise rather than a lasting rerating.” 

Reputational risk

Despite the apparent resilience of Evolution’s share price, the litigation and public disclosure of internal filings carry reputational risks. Robinson cautions that even if Evolution wins the final dispute, filings and findings could stir old concerns over grey market exposure. Evolution has said its long-standing complaint against Black Cube will be updated to include Playtech.

An affidavit made by Yanus, and shared during court proceedings, suggested Evolution was supplying games in Iran, Sudan and Syria – countries designated as state sponsors of terrorism. Evolution, in its most recent case filing disputing claims made by Black Cube, has insisted these were “material false statements”.

But court documents relating to Evolution’s case include comments that suggest Evolution does maintain some presence in black markets. The document cites a recording made by Black Cube of a conversation with Kfir Kugler, the founder and CEO of developer Ezugi, a live casino developer Evolution acquired in 2018. It quotes Kugler as saying: “[W]hat we do is that we supply products. This is, you know, unofficial. So, we do have games for Kurdistan and Iraq.”

Separately, Evolution remains embroiled in a UK Gambling Commission investigation for providing its games to black market operators. An update on this is expected before the end of the year. “I’d expect pointed questions from investors, but no break in confidence. The risk now sits in perception, not fundamentals,” Robinson says of the review.

Asia cyber attacks and RNG performance impacts Evolution valuation

Evolution claims the 2021 report has caused “multi‑billion‑dollar damage” to its business and share value. Reports have previously said that when the report first came to light, Evolution’s share price “plummeted by more than 30% over the week, wiping approximately $10 billion off its market capitalisation”.  Current data show Evolution’s market cap at around €11.6 billion (at the end of October 2025), which is a drop from about €26.9 billion in December 2021.

But beyond its long-claimed links to grey or black markets the supplier has faced increased valuation damage from continued cyber attacks across Asia and internal restructuring following a number of acquisitions. Its RNG business has been on a slow recovery journey for the last few quarters.

As the dispute progresses, the case could continue to impact share prices for both Evolution and Playtech, Robinson says. “From a share value perspective, both sides appear to have little to gain from letting this escalate.”

With regards to access to operators in unregulated jurisdictions, the complex web of aggregator networks and VPN usage makes complete prevention virtually impossible. 

“Content from major suppliers, including both Evolution and Playtech, often appears through third-party aggregators. That doesn’t prove direct involvement; it reflects the increasingly fragmented nature of distribution,” he adds.

Evolution must abide by Market Abuse Regulation

An equity analyst speaking to iGB under condition of anonymity, believes both Playtech and Evolution are aware their products seep into unregulated territories, and they should also be aware how bringing attention to this will eventually damage them both.

“It’s common knowledge that content leaks into grey or even black markets through intermediaries or cloned instances. Everyone in the sector understands this, and both sides must recognise that escalation could harm them equally,” they add.

Evolution, listed on the Nasdaq Stockholm exchange, faces particular scrutiny under the EU Market Abuse Regulation (MAR). When court proceedings reveal information that could affect a company’s valuation, that data may qualify as inside information – requiring prompt public disclosure. Failure to do so can invite regulatory investigation or sanctions. 

A Nasdaq spokesperson declined to comment on the specific case but told iGB: “It is the company’s responsibility to assess whether information constitutes inside information and to indicate this in the press release with reference to MAR.

“We continuously review that issuers comply with the Exchange’s rules and may initiate an investigation against an issuer if there are suspicions of rule violations.” 

Evolution’s balance sheet looks strong 

The saga underscores the growing struggles of corporate rivalry in the online gambling industry. Black Cube, known for its work in geopolitical and corporate espionage, was contracted to explore potential misconduct against a competitor.

Yet the path to accountability has been slow, with Black Cube repeatedly resisting court orders and Playtech striving to remain anonymous for some time. The litigation comes at a moment when the regulatory environment for B2B gaming suppliers is tightening, particularly in Europe.

Richard Williams, a lawyer at Keystone Law, notes that the issues raised in Evolution’s case are far from isolated. “The CEO of the Gambling Commission [Andrew Rhodes] said at his briefing in London on 7 November, that there will be a lot more to come in relation to games suppliers providing games to black market operators serving the UK,” he notes.

“I do not therefore think that Evolution is a special case. We are likely to see a lot more enforcement activity against licensed B2B software developers over the course of the next 12 months.” 

Broader implications on competitive ethics?

Investors will be watching not only the legal outcomes but also the broader implications for governance, compliance and competition ethics. Robinson suggests that the case may reshape investor thinking around reputation and ethics within the sector. “The case paints Playtech as the instigator and that plays in Evolution’s favour.

“The market split confirms it, positioning Evolution as the one smeared, not at fault. Regulators are likely to stay on the sidelines, but sentiment clearly leans against Playtech. In the B2B igaming space, investors may start scoring ethics and rivalry conduct alongside compliance, raising scrutiny on intel tactics.” 

Financially, the litigation and reputational fallout have not materially destabilised Evolution, which has historically had a strong balance sheet and substantial liquidity. “I’d expect a small risk premium to linger until the case closes, probably into 2026. Evolution’s balance sheet looks strong enough to support ongoing dividends and buybacks, and legal costs appear contained. Unless those costs escalate meaningfully, there’s no clear reason for capital policy to change,” Robinson observes. 

Nonetheless, the firm’s leadership is conscious of the need to maintain investor trust and demonstrate transparency. Adrian Westman, Evolution’s head of communications, underscores the company’s ongoing commitment to compliance and responsibility.

“Compliance is everyone’s responsibility and Evolution takes it with the utmost seriousness. Evolution invests significantly in systems and technology and uses all tools at our disposal to ensure compliance with all applicable laws, regulations and industry standards,” he tells iGB.

Playtech has also indicated it is committed to overall sector compliance and, in its 21 October statement, said it was “confident that these proceedings will confirm the credibility and legitimacy of the investigation and the importance of the issues it seeks to address”.

“Playtech welcomes court examination of the report and its findings,” it added.

More than a legal scuffle

The case illustrates the tangible costs of reputational warfare. The initial report did not only provoke regulatory scrutiny but resulted in significant financial damage to Evolution. Despite the eventual vindication, being targeted by a well-known competitor using private investigators can quietly hurt the company’s reputation and make investors less confident. 

Robinson reflects: “This dispute highlights ‘reputational warfare’ as a tangible cost of doing business. It echoes Evolution’s 2022 short-seller hit and other recent intelligence skirmishes across the sector. Boards will now tighten oversight of vendor conduct and due diligence, while ESG investors scrutinise governance around reputation management.” 

In January 2022 the company was hit by a short report that claimed the company’s unregulated revenue should have been valued differently from its regulated revenue.

Playtech, meanwhile, is left to contend with the fallout from being publicly identified as the orchestrator of the campaign against Evolution. The £1.8 million paid to Black Cube, while significant, pales in comparison to the reputational and financial costs of a collapsed share price and regulatory attention. For a publicly traded company, a shock of this scale can translate into lasting scrutiny from investors, regulators and analysts, even after the immediate financial penalties are absorbed. 

The Evolution saga is therefore more than a legal scuffle: it is a reminder that in the digital, highly regulated world of online gaming, the boundaries between competition and deception can blur, and the consequences are measured not only in pounds or euros, but in trust and market confidence. 

Evolution continuously denies black market links

As the case progresses through 2026, it will continue to command attention from investors, competitors and regulators alike. However, Evolution is confident in its legal footing. Westman insists the company’s focus is on accountability rather than damage control. “Evolution’s current defamation litigation is the company’s effort to hold Playtech and Black Cube accountable for its wrongdoing and protect shareholder value,” he said. 

But Playtech is also confident of its position. In its public statement it said its subsidiary approached Black Cube as an independent investigator to look into “credible and repeated concerns” from operators, suppliers and regulators about Evolution’s activities in prohibited and sanctioned markets. 

When asked by iGB, Westman insists the findings in the Playtech-commissioned report were false. Indeed, Evolution has for several years firmly denied it has had any involvement in illegal activities.

The next legal steps for Evolution will be to prepare its defamation case against Playtech and Black Cube case for trial, which is expected to run through 2026. “We are confident that the law and facts are on our side and look forward to presenting our case,” Westman adds. 

The charges against Emmanuel Clase and Luis Ortiz arguably represent the most serious gambling infractions against any Major League Baseball players since the historic PASPA decision in 2018. As set forth in the indictment, the defendants rigged specific pitches in advance of their appearances on the mound. According to prosecutors, the pitchers then provided non-public information to their co-conspirators, who used the information to place hundreds of fraudulent bets on the pitches.

On at least five occasions dating back to May 2023, Clase provided information to co-conspirators that was used to place thousands of dollars in bets. The bettors won approximately $450,000 on the wagers in question, with about $400,000 from information provided by Clase, prosecutors allege.

“When corruption infiltrates the sport, it brings disgrace not only to the participants but damages the public trust in an institution that is vital and dear to all of us,” said Joseph Nocella Jr, who serves as interim US Attorney for the Eastern District of New York. “Today’s charges make clear that our office will continue to vigorously prosecute those who corrupt sports through illegal means.”

Allegations of rigged microbets

Clase, a three-time MLB All Star, received American League Relief Pitcher of the Year honours in 2022, a season in which he led MLB in saves. Prior to that season, he agreed to a five-year, $20 million extension that included a $2 million signing bonus. It did not deter him from allegedly conspiring with a bettor as early as 2023.

In furtherance of the conspiracy, Clase informed an individual identified as “Bettor 1” of the type of pitches he planned on throwing at certain points of a sequence. In most cases, they agreed that Clase would miss the strike zone, usually on the first pitch when he entered a game. Before a Guardians game against the Mets on 19 May 2023, Clase provided advanced information to a bettor on a specific pitch that he intended to throw.

In many instances, Clase informed his co-conspirators of the type of pitch he intended to throw, enabling the bettors to win large wagers on a pitch speed prop. Against the Mets, “Bettor 1” and several other bettors won $27,000 by wagering that a pitch by Clase would exceed 94.95 miles per hour.

Deliberately hurling pitches into the dirt

According to the indictment:

– On  3 June 2023, Clase faced the Twins, the Guardians’ AL Central rival. The bettor and several co-conspirators won $38,000 on multiple parlays that Clase would throw a ball and his pitch would be clocked at under 94.95 mph. Federal authorities captured screenshots of the pitch that landed low and in the dirt.

– Nearly two years later, Clase “requested and received” a kickback payment in exchange for agreeing to throw certain pitches. On 12 April 2025, several bettors won $15,000 on a parlay that Clase’s pitch would be a ball and would be clocked at under 98.45 mph. Clase threw the pitch into the grass well before home plate. On the following day, Clase directed the bettor to send some of the winnings to the Dominican Republic.

– On 15 June 2025, Clase and Ortiz conspired to rig a pitch from Ortiz. Before the game, Ortiz agreed to throw a ball on his first pitch in the second inning. In exchange, Ortiz received $5,000, prosecutors allege. Under the arrangement, Clase also received $5,000. The bettors wagered approximately $13,000 on the microbet for a payout of $26,000.

A push to ban microbetting

The indictments were unsealed in the Eastern District of New York, which has become an epicentre for cracking down on illegal sports betting. Last week, the first of three NBA figures were arraigned in a dual sports betting-poker scheme that has rocked basketball. In light of the historic indictments, multiple federal lawmakers have called for a ban on prop bets.

Also this month, Ohio Governor Mike DeWine has resumed calls to prohibit microbetting on baseball. Over the summer, DeWine wrote a bulletin to the Ohio Casino Control Commission urging the regulatory agency to remove prop bets on “highly specific events” within games that are “completely controlled by one player”. During the MLB All-Star break, MLB Commissioner Rob Manfred remarked that certain microbets, specifically ones on pitches, are “particularly vulnerable” to manipulation.

MLB released a statement on Sunday that said: “MLB contacted federal law enforcement at the outset of its investigation and has fully cooperated throughout the process. We are aware of the indictment and today’s arrest, and our investigation is ongoing.”

The indictments represent the fourth integrity case against a major US sport over the last month, following stories involving the NBA, college basketball and the UFC.

A lengthy prison sentence

Both pitchers are facing several charges – including wire fraud conspiracy, honest services wire fraud conspiracy, conspiracy to influence sporting contests by bribery and money laundering conspiracy – for their roles in the alleged schemes. Ortiz, 26, was arrested on Sunday at Logan International Airport in Boston. The Guardians pitcher was scheduled to appear in federal court in Boston on Monday.

In a statement provided to ESPN, an attorney for Ortiz said that the pitcher is innocent of the charges and that he “would never improperly influence a game”. Chris Georgalis, an attorney for Ortiz, wrote that the charges relate to only two pitches thrown by his client.

MLB suspended both pitchers over the summer, pending further investigation. If convicted, the pitchers each face up to 65 years in prison. As of Sunday afternoon, Clase was not in US custody, according to a press release from prosecutors.

The combination will, on paper, create a €6.4 billion-revenue European champion, according to Banijay’s own pro forma figures. But the significance of the transaction lies less in its scale than in what it reveals about the industry’s direction of travel.  

“This deal represents a significant convergence of the media and gambling industries. It combines entertainment content with sports betting,” says Gabriele Stark-Lütke Schwienhorst, senior associate at CMS Germany.   

The deal, he says, also reflects the trend of vertical integration, whereby content producers leverage their media assets to boost customer engagement and stand out in highly competitive betting markets. 

It signals a shift towards cross-media ecosystems in the European gambling industry and a clear strategy for Tier 1 operators towards continued consolidation in heavily regulated European markets.

Banijay-Tipico’s combination proves entertainment, data and gaming are beginning to interact and integrated digital experiences could become more common.

Last week on Banijay’s Q3 earnings call, CEO François Riahi dismissed analyst suggestions the group could go all-in on gaming and look to wind down its media business. “The Tipico acquisition was a very major event for us and we stick to our strategy here for growth in gaming,” he told analysts.

“However, we also believe that we have very positive opportunities on the content side. So no, we don’t have any plans to sell this division.”

Banijay-Tipico: A strategic marriage 

Banijay’s €3 billion financing package will buy out CVC Capital Partners’ majority stake in Tipico, uniting two complementary businesses: Betclic, a digital specialist with leading positions in France, Portugal and Poland; and Tipico, a dominant omnichannel operator across Germany and Austria. The result is a combined force in six regulated markets, serving 6.5 million customers and operating over 1,200 betting shops. 

For Banijay the rationale is diversification. Long known for producing shows such as “Survivor” and “Big Brother”, the Paris-based group has been edging steadily into gaming. With Tipico, gaming becomes the majority of Banijay’s revenues.

Vaughan Lewis, a veteran gambling strategist, calls it a “transformational deal, creating a leading betting and gaming operator across key European countries, and one of the largest in the world”. The logic, he says, is “further evidence of the ‘local hero’ consolidation strategy, combining market-leading brands while benefiting from group economies of scale”. 

Risks and legal challenges 

The transaction’s stakeholders all emerge with distinct advantages. Betclic gains access to new markets in Germany and Austria, while Tipico inherits a continental platform and capital backing for expansion.

“Big tech synergies should drive better operating margins for the buyer group,” notes Paul Richardson, managing partner at Partis Capital. For CVC, the deal is a well-timed exit after a recent refinancing of Tipico. “This is a great result for them and shows it’s somewhat opportune versus planned.” 

For Banijay’s shareholders, the financial story is equally compelling. The company expects to generate around €100 million in annual synergies in the medium term, while raising profitability from 18.7% to 21.6%.

“Banijay’s gaming division doubles to become the majority of the group,” Lewis adds, suggesting that “there is potential for an IPO or spin-off of the gaming or media unit to unlock further value”. 

The Banijay-Tipico deal will impact the broader gaming landscape for the European sector, remarks Paul Richardson, as “it stops Flutter moving into Germany, as there is very little else to buy of scale in the market”. 

For all the enthusiasm, integration risks remain. Banijay will have to harmonise corporate governance across two highly regulated jurisdictions, reconcile technology stacks and manage cultural integration between a French tech-driven operator and a German retail-anchored one. As Stark-Lütke Schwienhorst points out, “aligning licensing and compliance could be complicated”, since Tipico operates under a German licence.  

And cross-border fiscal implications may also give rise to further legal issues for the Banijay-Tipico transaction, warns Stark-Lütke Schwienhorst. “Chief among these are regulatory and competition law issues, given that the deal is likely to be scrutinised under the EU Merger Regulation and potentially by national competition authorities.” 

Banijay will need to navigate Germany’s Joint Gambling Authority, one of Europe’s strictest regulators, as well as obtain approval from EU competition authorities. Completion, expected in mid-2026, hinges on those approvals — and on Banijay’s ability to integrate entities with very different operating cultures, experts point out. 

Consolidation will continue to drive the sector 

The Banijay-Tipico union is the latest chapter in an accelerating wave of European gambling consolidation – following on from Allwyn´s takeover of OPAP only a few weeks ago. Operators are racing to gain scale as taxes rise, margins narrow and regulation tightens across the continent. “Consolidation will continue to drive the sector, driven by margin pressure from regulation and operating costs,” says Richardson.  

The logic is simple: compliance costs and marketing restrictions are squeezing smaller firms, while established players look to spread fixed costs across wider revenue bases. As in other industries, bigger increasingly means safer. “Scale and resilience to regulatory shocks is key to long-term success,” Richardson observes. 

Lewis agrees, describing the Banijay move as a new template for consolidation across regulated European markets.

The shift, he argues, is away from chasing high-risk grey markets and towards mastering complex regulated ones. “This demonstrates that significant value creation is being driven by regulated markets,” he says. “Regulatory challenges create barriers to entry, which tends to increase the value and sustainability of the leading operators.” 

The French paradox 

That dynamic explains an irony not lost on observers: with Banijay’s gaming division and FDJ United’s acquisition of Kindred Group earlier this year, Europe’s two largest gaming empires are now based in France — a country with punishing tax rates and no legal online casino sector.  

“France’s market is indeed highly regulated and heavily taxed, yet certain operators demonstrate a sophisticated regulatory resilience,” says Stark-Lütke Schwienhorst. 

Their compliance expertise, financial strength and institutional relationships provide a competitive edge as other jurisdictions tighten controls. “Ironically, being forged in a tough market like France or Germany could become a strength when expanding across Europe,” he adds.

Lewis goes further. “France as a hub for Tier 1 operators despite regulatory challenges shows that domestic-based companies are proving operational excellence in challenging environments,” he notes. Any expansion of regulation of online casino in France could significantly grow the total potential market size, he points out.  

For investors, this resilience carries appeal. France’s high tax environment might deter weaker players, but for those that master it, it creates defensible, sustainable competitive advantage. The same logic underpins the position of the state-linked FDJ United, which completed its purchase of Kindred in 2024, adding Unibet’s pan-European presence to its lottery backbone. 

Continental realignment 

The broader picture is of a sector reorganising across the whole continent. The UK – once Europe’s undisputed iGaming powerhouse – is increasingly constrained by a tightening regulatory regime, rising tax burdens and curbs on cross-vertical marketing.

The Netherlands and Sweden are following suit. And last month Denmark announced new tightened rules regarding advertising. In contrast, continental European groups are quietly consolidating strength in markets with stable, albeit strict, regulatory frameworks. The sector is entering a phase of regulatory convergence and market cleansing, suggests Stark-Lütke Schwienhorst.  

“Smaller operators will struggle with rising taxes and compliance costs, leading to further consolidation. Larger, well-capitalised groups with diversified portfolios are best positioned to adapt. There is a good chance that the future European landscape will favour integrated entertainment ecosystems, not pure betting operators.” 

Banijay’s move follows a pattern seen before. Richardson compares it to Flutter’s acquisitions of Sisal and Snai. “A large multinational buying market leader in a local market. In both cases, the buyer had bought into an omnichannel operation and is now exposed to retail,” he says.

Lewis draws parallels with the Sky Betting & Gaming sale to The Stars Group, where CVC also exited.  “That was also CVC selling a market-leading position in a key country to a more diversified leader,” he notes. “FDJ and Kindred had some similarities too. So did the Allwyn/OPAP merger and the Intralot/Bally’s deal.”

Such comparisons underscore how Europe’s betting landscape is becoming a handful of regionally diversified conglomerates — Flutter, Entain, FDJ United, Banijay Gaming and Allwyn are among those.

The road ahead 

Analysts see the Banijay-Tipico deal as an early sign that additional similar deals are coming. 

“This is likely to be a trigger for further M&A across regulated markets,” predicts Lewis. “The industry remains fragmented and relatively immature. Scale is critical, as demonstrated by the €100 million synergies here.” 

Richardson foresees “other private-equity or former PE single-market operators like Lottomatica needing to buy international diversification at scale and get more ‘baskets for their eggs’”.  

Stark-Lütke Schwienhorst, meanwhile, expects a wave of smaller acquisitions: “We can expect continued consolidation, especially targeting small- to mid-sized operators in Europe.”

Acquisitions in RegTech and FinTech will likely also rise, driven by the need to automate compliance and improve efficiency. The broader trend also points toward media-gaming convergence where entertainment companies seek audience monetisation through gaming and betting firms seek audience engagement through content, Stark-Lütke Schwienhorst points out. 

The consensus among experts is that the next phase of European gaming growth will not come from regulatory arbitrage or from unregulated grey zones, but from disciplined execution in challenging jurisdictions.  

Therefore, future growth in Europe’s iGaming industry won’t come from taking advantage of loopholes or operating in loosely regulated markets, but instead from doing business well in countries with strict rules. 

“Operators that thrive under strict regimes such as Germany or France develop advanced compliance frameworks, responsible gambling systems and scalable tech infrastructures,” says Stark-Lütke Schwienhorst. “These conditions foster innovation and credibility, enabling them to outperform less mature competitors. In short, regulatory maturity breeds operational excellence.” 

Lewis concurs: “Betclic and Tipico have shown that operators with strong brands, effective operations and a clear strategy can build a highly profitable and sustainable business in mature, regulated markets.” 

The outcome, if Banijay’s bet pays off, could be a new European order in gaming – one where stability and compliance, not aggression and opportunism, define leadership. The entertainment conglomerate from Paris will need to prove that it can integrate Tipico smoothly. But if it succeeds, the combination of storytelling, data and betting could reshape not only Europe’s gaming industry but its entire digital entertainment economy. 

What was once a familiar fixture of local life and working-class leisure could soon become a casualty of what the gambling industry has called a shortsighted fiscal ambition. 

Even before the threat of new levies, the retail segment was faltering as the nation’s gambling habits migrated largely online. Quarterly updates from Entain – with over 2,000 stores across its Ladbrokes and Coral brands – have repeatedly described retail as a “stable” but low-growth segment, although the group insists it “treasures” its shops as the backbone of its brand.

Major operators have issued stark warnings against a hike, insisting the impact could wipe out retail betting in the country, with thousands of jobs and hundreds of shops at stake. Aside from Flutter’s recent closures, Evoke, which operates 1,300 William Hill outlets, has also threatened to close as many as 200 shops – 15% of its estate – if taxes rise. As have Entain and Betfred.

“If [the tax rate] went up to anywhere like 40% or even 35% there is no profit in the business,” Betfred founder Fred Done said in an interview with the BBC on 19 October. “We would have to close it down … probably 7,500 job losses.”

Speaking to iGB, a spokesperson for Flutter UK & Ireland reiterates the impact a rise could have on its retail business, noting it has already had to close shops even before any tax increase. “We unfortunately had to close 57 Paddy Power shops last month – and that’s before any increase in gambling duty. Any tax increase on business isn’t a free hit, it comes with consequences,” they warn.

Tax hike will ‘devastate’ UK high street bookmaker jobs

A rise in gambling duty will have a significant effect on jobs and sports sponsorships, as well as offering a huge boost to an illegal black market that has almost tripled in size in the UK in the past three years. 

A report commissioned by the UK’s Betting and Gaming Council (BGC) in October claimed such a “tax raid” could wipe out £3.1 billion from the UK’s economic output and threaten more than 40,000 jobs.

The analysis by EY found that once lost employment, reduced corporation tax and lower National Insurance contributions are considered, the Treasury’s net gain from the proposed UK gambling tax hikes could fall below £500 million.

“Further tax hikes would devastate jobs, reduce Treasury revenues and drive billions into the hands of the black market,” the BGC tells iGB.

The impact of a possible UK gambling tax rise on the already suffering retail sector has been clearly outlined by stakeholders, but some parliamentarians appear skeptical of the sector’s warnings.

Treasury committee doubts impact of remote tax hike on retail

During a Treasury committee session held in Parliament on 28 October, committee members probed BGC CEO Grainne Hurst and the trade body’s tax policy advisor, Stephen Hodgson, on the issue, seemingly expressing doubts over the sector’s threats that retail would take a hit even if remote taxes were to increase.

Hurst confirmed that UK gambling companies operated a “circular economy” and a single profit-and-loss model, meaning any impact to one side of the business would inherently be felt across the group.

“They will be reinvesting money they make in one part of their business into another. And so if we see any additional further tax increases on any part of the sector, it is likely to have an effect on the retail side of the business,” Hurst told the panel.

“These are businesses that operate in an integrated manner. So if you were to increase remote taxes and leave land-based taxes untouched, you would still see a consequence on the overall ecosystem,” Hodgson added.

“If you look at some of the larger businesses the BGC represents, they are quite integrated. That’s how they manage to achieve economies of scale and become the large, successful businesses they are. And they will look at costs across the board.”

Could the retail sector be shielded from the impact?

Elsewhere, the panel discussed the potential of specifically shielding the retail sector from any tax increase by establishing a separate rate for online and retail betting activities.

Currently the sector pays a flat 15% General Betting Duty across profits made from bets made both online and in-person. But during the meeting Paddy Power co-founder Stewart Kenny proposed a separate lower rate for retail activities to help protect high street bookies from extinction.

“I believe there should be provisions in any taxation [model] that betting shops will be lower, because I think they can be a real social [hub] for people who don’t drink, to have fun. Betting shops do have a future, but obviously like [everything] on the high street they are going to suffer,” he said.

A social institution under threat 

Operators have equally raised concerns over the human impact of shop closures. In an interview with The Times, Entain CEO Stella David said closures would be a blow to community identity. “We don’t want to close shops,” she said. “These are part of Britain’s cultural fabric – not just places to bet, but places where people come together.” 

The sense of loss is echoed across the industry, says Bethan Lloyd, senior associate at Wiggin LLP who previously worked in William Hill’s legal team. She points to the special place the high street bookmakers hold in the lives of punters.  

“Many of these bookies serve as something of a social base for their regular customers; it is sad that this will be taken away,” she notes.

“Many of our shops play a central role in communities and we are committed to our retail estate, but clearly any duty rise in the upcoming budget could impact our plans,” the Flutter spokesperson adds.

Dan Waugh, a partner at Regulus Partners, believes the disappearance of the betting shop will have real social consequences. “Millions of people choose to bet and watch racing in shops despite the fact they can do both at home. A meaningful number of consumers will find their lives negatively impacted by the withdrawal of an activity that brings them pleasure,” he says. 

Impact on mental health 

Mark Pearson, Betfred’s head of corporate affairs and communications, stresses there is a lot more at stake than just a line on a balance sheet. “Retail is the very heartbeat of our business,” he says. “Fred [Done] started with just one shop in 1967. Betting shops are a massive part of communities and high streets.”

He also warns the knock-on effects would be profound. An impacted retail sector would mean reduced investment in horse racing and sport, and not least “a free pass for the black market that offers no protection for vulnerable players.” 

The BGC estimates that 1.5 million Britons stake up to £4.3bn annually with unlicensed operators in a growing black market.

Dan Waugh at Regulus Partners also adds a sobering warning that funding for treatment of gambling disorders, as well as harm prevention initiatives and research, is at risk of falling too. Under the new statutory levy, around 90% of funding comes from betting shops, online betting and online gaming.  

“If consumer spending in these channels falls as a result of tax increases, then we may see essential mental health treatment services collapse.”

The human cost 

The threat to the UK land-based gambling sector is not just about betting shops. The proposed UK gambling tax structures from think tanks such as the IPPR and Social Market Foundation (SMF) would hit all land-based gambling venues – from casinos and bingo clubs to seaside arcades.

Dan Waugh believes the SMF and IPPR reports which propose more than doubling current UK gambling tax rates are of “extremely poor quality”.

“Neither think tank appears to have considered the impact of shutting down large swathes of the land-based industry,” he laments. “Clearly, omnichannel incentives will be far less relevant if there are far fewer shops,” he says of crucial player retention strategies that operators have built over years.

But Lloyd acknowledges that successfully converting customers between online and retail has been a challenge for all the major operators. She says many retail clients don’t regularly bet online and stricter marketing rules have added a layer of complexity to omnichannel approaches.

Behind UK high street bookmakers lie thousands of British employees, many of whom have spent decades in the same communities and companies. Lloyd notes the personal cost is that these staffers will unlikely be redeployed as the industry is tightening its belt across the board.  

UK high street bookmaker employees won’t be redeployed

This will also negatively impact the consumer experience, Lloyd says: “This route will be minimised or removed, and with it, the grassroots knowledge of the punter and the product.”  

Waugh agrees that political advocates of the tax hike underestimate this disruption. “It is easy for people in Westminster think tanks to say that betting shop employees can easily find work elsewhere,” he says. “This ignores the fact that unemployment is rising, that in some parts of the country jobs simply aren’t there.”  

The industry’s geography aggravates the issue. “Online gambling – as with ecommerce in general – tends to concentrate employment in a small number of locations,” Waugh notes. “There might be some opportunities for shop workers in places like Stoke-on-Trent and Leeds, but these are exceptions.” 

The end of an era? 

Retail betting shop closures could have a ripple effect across British racing and related industries. A quarter of racing turnover occurs in betting shops, meaning their disappearance would erode media rights revenues and levy receipts.

“Racing will be the most impacted,” says Lloyd. “Given the demographic of the shops’ customers and their betting patterns.” 

As the chancellor’s autumn budget approaches, the industry’s lobbying has reached fever pitch. Entain’s David has urged policymakers to look beyond short-term revenue. “When you start damaging the regulated market, you don’t get less gambling, you just get less safe gambling,” she has told the media.

The image of the British bookmaker has endured for decades. But it now stands at a crossroads. Taxation that aims to boost public finances could instead hollow out the very communities it is meant to serve and, if the environment becomes unsustainable for the operators, policymakers may soon witness the disappearance of one of Britain’s last surviving high street institutions.  

Apprehension started to mount in February over the possibility of Ohio Republican Brian Quintenz becoming the next chair of the CFTC. Quintenz, a former CFTC commissioner nominated that month by US President Donald Trump, had direct ties to prediction markets as a sitting board member for Kalshi. Additionally, Quintenz publicly advocated for another exchange, ErisX, in its failed attempt to offer sports contracts in 2021.

Now, Quintenz’s nomination has been pulled after multiple hiccups, and Trump this week announced a new nominee: Michael Selig. Selig’s expertise is cryptocurrency, from both a regulatory and legal perspective.

While the gaming industry has been focused primarily on prediction markets, the Quintenz-Selig shuffle could signify that crypto is the real prize at stake. Yet with Quintenz also heavily involved in crypto himself, it could also just be more of the same.

Who is Michael Selig, the new CFTC chair nominee?

Selig currently serves as chief counsel of the Securities and Exchange Commission’s Crypto Task Force and as a senior advisor to SEC Chair Paul Atkins. Back in 2014-15, Selig also worked in the office of former CFTC commissioner J Christopher Giancarlo, per LinkedIn.

Giancarlo was a commissioner at the time Selig worked for him, but he went on to become CFTC chair in 2017 during Trump’s first term. He has since adopted the nickname “Crypto Dad” for his support of digital assets and published a book under that title in 2021.

David Sacks, Trump’s so-called “AI and Crypto Czar”, said in an X post that Selig has “been instrumental in driving forward the President’s crypto agenda” at the SEC, adding that he and Selig will “deliver on President Trump’s promise to make the US the crypto capital of the planet”.

In response, Selig posted that he would “work tirelessly to facilitate Well-Functioning Commodity Markets, promote Freedom, Competition and Innovation and help the President make the United States the Crypto Capital of the World”.

Quintenz nomination lost early momentum

Quintenz’s candidacy, if charted on a prediction market, might look like something of a bad beat. It started strong, but the longer his nomination dragged on without confirmation, the more things started to unravel.

Quintenz faced questioning during a Senate hearing in June and his confirmation vote was twice delayed afterward, both times abruptly and at the last minute. In July, the release of internal CFTC emails through a FOIA request from The Closing Line newsletter suggested undue access for the yet-unconfirmed Quintenz.

Then, billionaire crypto twins Tyler and Cameron Winklevoss got involved, leading Quintenz to distance himself in September by posting threatening messages he had received from Tyler. The messages claimed the CFTC “abused” its power in previous legal action against Gemini, the twins’ crypto trading platform.

“It’s my understanding that after this exchange they contacted the president and asked that my confirmation be paused for reasons other than what is reflected in these texts,” Quintenz posted on X.

The White House pulled his nomination on 30 September before nominating Selig weeks later.

CFTC chair candidates share multiple similarities

Between the two nominees, Selig has fewer direct connections to prediction markets than Quintenz. But there are some connections, and Quintenz’s crypto experience ultimately could make the two more similar than not.

According to InGame, Selig’s name appears on a July 2024 letter submitted by venture capital firm Paradigm Operations to the CFTC in support of Kalshi’s legitimacy as a prediction market.

Kalshi had not begun offering sports contracts at the time, but Paradigm argued that “the CFTC’s characterisation of political contests, awards contests and sporting events as forms of ‘gaming’ is arbitrary and capricious”. Selig was among three attorneys from the firm Willkie Farr & Gallagher LLP representing Paradigm. The VC firm would go on to invest in Kalshi this year.

Quintenz, for his part, is also heavily involved in crypto. He became an advisor to Crypto.com months after leaving the CFTC in late 2021, and he spent the past four years at Andressen Horowitz (or a16z), a crypto-focused VC firm. Since late 2022, Quintenz has served as its head of policy for crypto. His tenure as a CFTC commissioner also aligned with Giancarlo’s tenure as chair.

Based on these points, it remains to be seen whether gaming stakeholders would view Selig as a more favourable candidate by comparison.

Regulatory questions at play for CFTC, SEC

Since Trump took office for his second term in January, crypto advancement has been a key goal for the administration. The GENIUS Act, the most significant regulatory bill for digital assets introduced in the US to date, was signed into law in July. Another similar bill, the CLARITY Act, passed the House in July but has been sitting in the Senate since September.

Prediction markets have not seen the same level of legislative or regulatory clarity. Acting CFTC Chair Caroline Pham hosted a meeting with tribal gaming stakeholders earlier this year but did little to assuage their concerns. In an advisory issued in late September, the CFTC gave no concrete guidance and essentially said it has yet to determine the validity of sports contracts.

In the meantime, the influx of new crypto rules could put the SEC and CFTC in tough spots with regard to oversight and delineation. The agencies have historically been independent of one another. As their names suggest, the SEC primarily oversees securities like stocks and bonds, while the CFTC oversees commodities and derivatives.

Various forms of digital assets like crypto might not fall neatly within one box or another. Notably, Selig has had intimate dealings with both agencies in his career thus far.

The two agencies in September held a unique roundtable discussing possible regulatory synergies. Among the panellists were Kalshi’s Tarek Mansour and Polymarket’s Shayne Coplan, although neither participated much. Crypto interests were also well-represented by officials from Crypto.com, Robinhood and Kraken.

Before Selig’s nomination, a sense emerged among observers that the SEC’s Atkins was gaining momentum as a potential CFTC chair candidate as well. Such a consolidation would have been unprecedented, but the subsequent roundtable was perhaps an indication that their relationship is aligning closer.

Crypto interests dwarf prediction markets

The true breadth of the CFTC’s remit was perhaps best shown in Quintenz’s Senate hearing. For almost two hours, lawmakers presented questions about agriculture, ranching, commodities, crypto and, to a much lesser degree, event contracts on prediction markets.

That divide in priorities seems to be more apparent as the saga plays out. It was the crypto-focused Winklevosses, not the collective furor of the regulated gaming industry, that proved to be Quintenz’s downfall, and perhaps for good reason: the crypto market this summer eclipsed a total market value of $4 trillion.

By comparison, nationwide gross revenue this year from casinos, sports betting and iGaming combined was $51.1 billion through August, per the American Gaming Association. Sports betting, the vertical most closely associated with prediction markets, accounted for $10 billion of that.

Prediction markets are also small in scope when compared to crypto’s trillions. Leading exchanges Kalshi and Polymarket are garnering multibillion-dollar valuations but there are few other significant players as of yet. Additionally, gaming companies like FanDuel, DraftKings and Robinhood have already launched or are planning to launch prediction markets, which could saturate the market.

Prediction markets make money off trading commissions and other transaction fees. As such, the exchanges often see billions in weekly trading volume (not directly equivalent to sportsbook handle) but their revenue is only a small fraction of that.

Notably, though, prediction markets do not have to pay state gaming or federal excise taxes, nor do they have responsible gaming obligations to answer for.

Trump administration connected to both sides

The connections to both crypto and prediction markets are everywhere in Trump’s administration. Donald Trump Jr is an advisor to both Kalshi and Polymarket, having endorsed them after they correctly predicted his father’s election victory last November. 1789 Capital, a firm backed by Trump Jr, invested in Polymarket this year.

Things went a step further this month with the announcement that Trump’s media arm will offer prediction markets through a partnership with Crypto.com. The contracts will be available to users directly through Trump’s Truth Social platform.

Trump is constructing a $300 million ballroom at the White House that was privately funded by 37 donors. The donor list featured some traditional gaming stakeholders but is littered with crypto connections, including:

• The Winklevoss twins
• Coinbase, a crypto exchange platform
• Ripple, a blockchain payments network
• Tether America, a blockchain payments network
• Charles Cascarilla, co-founder of blockchain payments network Paxos

If you can’t beat ’em, join ’em?

An ironic part of the prediction market-crypto discussion is that the regulated industry would likely pursue both verticals if their licences would not be at risk by doing so. The push by some companies to enter the prediction market space is evidence of that, and those that have not have largely blamed regulatory uncertainty.

Caesars Entertainment CEO Tom Reeg said this week his company won’t put “any licences” at risk to pursue prediction market deals. He also asserted Caesars “is preparing and would be prepared to go down that path” if clarity comes.

Mike Dreitzer, chairman of the Nevada Gaming Control Board, indicated earlier this month he would be open to bringing prediction market technology under state law if able.

There are similar feelings for crypto, which is a popular payment method for younger players. At the ICE Barcelona conference in January, a panel of three international CEOs – Per Widerstrom (Evoke), Gavin Isaacs (Entain) and Fabio Schiavolin (Snaitech) – all lamented that unregulated platforms can utilise crypto while they cannot.

“All three of us would dream to be in the unregulated market just for a day,” Schiavolin joked at the time.

FanDuel founder now leaning into crypto

Those who are venturing into crypto despite the regulatory gruff are seeing the benefits. Nigel Eccles, co-founder and former CEO of FanDuel, has started a new crypto-based iGaming venture called BetHog.

The platform is not licensed or available in the US, but Eccles has embraced crypto as the new frontier, much like he did with daily fantasy sports in the early-to-mid 2010s. DFS is where FanDuel and DraftKings got their start, which at the time was also unregulated. Both have since grown to become the biggest regulated sports betting and iGaming companies in the US.

“We’ve got a very clear signal from the federal government that [crypto] is a technology we should embrace,” Eccles told iGB. “We’ve got really clear operator interest. And so I do feel at a state level, a state regulator level, it is only a matter of time” before the benefits outweigh the risks.

Eccles said security and anti-money laundering risks are the biggest barriers holding crypto back from gaming. But he argued the traceability of crypto makes it more secure than fiat currency, and individualised wallets help protect against fraud and chargebacks.

From a functional standpoint, Eccles contends that operators would save tremendously on money-moving fees, which eat away at margins. This, in turn, could allow for more bonusing to players or other similar benefits.

“Instead of giving 15% of our revenue straight out the door to Visa and MasterCard, we can actually give a chunk of that back to the player and say, ‘Look, you can have a better experience’,” Eccles said.

At the heart of the debate is Morten Rønde, director of the Danish trade body Spillebranchen and managing partner at Nordic Legal. Speaking to iGB on the immediate impact of the changes, Rønde did not mince his words.  

“I am shell shocked to say the least,” he says, capturing the uncertainty and frustration spreading through the sector.  

For more than a decade Denmark has been viewed as a model for balanced gambling regulation – strict enough to protect consumers yet flexible enough to sustain a competitive licensed market. That balance, according to Rønde, has been the key to its success.  

Regulator’s relationship with the sector

In August, Denmark achieved gambling revenue of DKK 714 million – both a year-on-year and month-on-month increase. Sports betting and iGaming markets posted double-digit growth compared to the same month last year. 

“I think the key is that Denmark has struck a balance where you have strict consumer protection and kind of strict, but still pragmatic, rules that are possible to comply with for the operators,” Rønde says. The model, he added, maintained a structure where the regulator has been working “in a very open-minded way”. 

This dialogue-based relationship between the regulator and licensees – praised in a recent comparative report between Sweden and Denmark, ordered by the Swedish trade body BOS – has long been a cornerstone of Denmark’s success.  

Rønde insists the Danish Gambling Authority operates as “the glue in the system”, maintaining trust through direct, transparent communication. “Each operator has two contact persons assigned,” he adds, “a legal contact and a technical contact. So that creates a more personal approach in dialogue with the regulator.” 

A turning point for Denmark’s gambling model 

But that finely tuned balance has come under strain. The government’s new gambling agreement marks a decisive shift. Minister for Taxation Ane Halsboe-Jørgensen of the Social Democrats said it marked the beginning of a reckoning with a gambling industry “that has, for far too long, taken up too much space”.  

She said the new measures were to prevent entertainment “from turning into addiction. It requires both responsible operators, stronger regulations and a sustained political effort.” 

The government claimed nearly 500,000 Danish adults experienced some extent of gambling problem in 2021 – a figure that has doubled since 2016 – with almost 30,000 experiencing serious gambling problems. Twenty-five thousand Danish children and young people have experienced some degree of gambling harm, according to government data. 

“I’m really pleased that we’ve reached a broad agreement that, above all, ensures we can now protect our children and young people much better from advertising for gaming and gambling,” Jan E Jørgensen of the Liberal Party, Venstre, said. 

Denmark gambling addiction debate intensified

As public debate around gambling addiction intensifies in Denmark – fuelled by high-profile media stories about widespread gambling addiction among younger men and political pressure – Rønde argues that the measures being implemented are not evidence-based. 

“There’s been a rise in gambling addiction,” he acknowledges, “but based on a study that is now three years old and had quite inconclusive findings.” The government, he said, is acting largely because “people are just sick of all the gambling adverts, which we agree with – there are too many of them. They are overexposed in the market.” 

Rønde is certain the arguments put forward in the political decision-making process were not supported by meaningful evidence. “In all the proposals that are made, there’s no link to any evidence that this is something that will help gambling addiction. And I am pretty sure that it won’t,” he says. 

In his view, the only sustainable path forward is to manage the balance between consumer protection and an attractive regulated offer. “Advertising in Danish media is the only advantage that a licensed operator has. Because otherwise it’s just restrictions and taxation. When you are [no longer] allowed to advertise, you lose that competitive advantage,” Rønde explains.  

If those advantages continue to erode, he warns, “there’s nothing left other than the branding you can put on your website that says you’re regulated by the Danish authorities.” Outlining the broader risks, he insists restricting the legal market too heavily will tip the balance. 

“And it becomes unviable for the operators, but also for the consumers in Denmark. That leads to leakage in the market and consumers going to the black market. And again, in turn, it would lead to more addiction and more gamblers who get in trouble.” 

Total ad ban threat and the risk of market leakage 

The new rules, agreed to by a broad coalition of political parties, will prohibit betting advertising during live sports broadcasts, restrict outdoor advertising within 200 metres of schools and impose new limitations on bonuses. This could indicate the end of outdoor advertising in Denmark’s major cities.  

Still, Rønde warns the outcome could have been worse: “It looked worse at one point; a complete advert ban was discussed, but it’s still not great where we’ve landed.” The political appetite for stricter measures remains strong. “There are several political parties in Denmark who are in favour of a full advertisement ban,” he notes.  

“What happens if you do impose a ban? Those countries who have tried like Italy and now the Netherlands have seen an explosion in illegal gambling offerings.” He points out the Italian government is now rolling back part of its advertising ban because it was creating too many illegal gambling offers for Italian players. 

Denmark could follow the same path – undermining its once-enviable rate of channelisation. “It’s impossible to block operators from the market,” he says of illegal offerings. Black market presence in the market is heightened by a lack of popular products like crash games and virtual betting, as well as various casino games that are banned.  

H2 Gambling Capital data shows Denmark’s channelisation rate has fallen to 72%, the same as Sweden. It was historically among the highest in Europe, sitting at around 90% in 2022. Rønde attributes much of the decline to player interest in the aforementioned banned verticals.  

Mounting economic consequences 

In terms of economic consequences for the sector, Rønde can’t put a figure on it, but insists the sum of the 20 or more new measures will have a big impact. The trade body is considering what these changes will mean for the industry. Most concerning is the likelihood that operators will exit the market in response. “It will severely impact the market and the whole business of being in Denmark,” he laments.  

TV2, the biggest commercial TV channel in Denmark, which holds the licence to show matches in the Danish football Superliga, said it expects revenue to drop due to the gambling ad ban – potentially up to €12 million per year. “It should be no secret that the regulation comes with significant financial consequences,” TV2’s commercial director, Stig Møller Christensen, said of the impact. Previous government calculations pointed towards a loss in tax revenue in the hundreds of millions in Danish Kroner for the state.  

Denmark was the industry’s ‘beacon of light’ 

In neighbouring Sweden, gambling trade body BOS has been watching Denmark’s developments closely. Gustaf Hoffstedt, BOS’ secretary general, voiced concerns that the new Danish direction could undermine a system long seen as a model for Europe. 

“It concerns me,” he says, “because Denmark, together with the United Kingdom, have been the two beacons of light in Europe when it comes to safeguarding the licensing market.” According to Hoffstedt, H2’s revised estimate of 72% channelisation for Denmark is “totally dissatisfactory”.  

Like Rønde, he warns against measures that risk driving consumers toward unlicensed gambling: “Denmark should pay more attention to how to create an attractive legal licensed market than to implement measures that will scare away more consumers. After all, that’s the number one consumer protection measure that you can take.” 

Hoffstedt cautions that Denmark’s reputation as a regulatory role model is now in question. “Denmark has at least up to this moment been possibly the best example in Europe,” he notes. “Yes, I’m afraid it will change – that Denmark is also choosing a path that in the long run may lead to them crawling in the mud, just as so many other European jurisdictions.” 

The message is clear: tightening regulations without maintaining a viable, competitive legal market risks undoing years of progress in consumer protection and channelisation.

As Denmark’s gambling restrictions move toward implementation in January 2027, time will tell whether one of Europe’s most admired regulatory systems can preserve its balance – or whether it will become, as Rønde fears, another example of good intentions gone awry. 

Jones, a former teammate of the NBA’s career leader in points, allegedly disseminated non-public inside information on an injured player to a betting syndicate in February 2023. While the Lakers forward is not named in the indictment, the unnamed player fits the profile of James based on the fact pattern enumerated in court filings. Hours after Jones’ arrest on 23 October, a federal prosecutor urged a Nevada judge to impose restrictive conditions on his pre-trial release. The strict conditions stem from the ex-NBA player’s “serious gambling problem”, noted Clay Plummer, an assistant US attorney, at last week’s hearing.

Given the immense publicity the case has received, Jones’ compulsive gambling habits could serve as a mechanism for convincing others to seek help, according to several leading specialists in the field. Jones, who amassed NBA career earnings of nearly $22 million, told the judge last week that he could not afford to hire a defense attorney.

“If Mr Jones does in fact have a serious gambling problem, I hope he knows that help and hope are out there and that recovery is possible,” said Brianne Doura-Schawohl, CEO of Doura-Schawohl Consulting LLC, a boutique global government relations firm that specialises in problem and responsible gambling policy. “It would be nice if his story served as an inflection point for change.”

Saddled in debt

While Jones ended his NBA playing career more than a decade ago, he has remained in close contact with James. During the 2022-23 NBA season, he served as an unofficial assistant coach with the Lakers, where he had pre-game access to the NBA star. Jones allegedly provided a tip to a syndicate that a player would miss a 9 February 2023 game against the Bucks. For his efforts, Jones received a payment of $2,500, court filings state.

Since Jones’ arrest, a narrative has formed around his proclivity towards heavy gambling. One professional gambler told the New York Post that he witnessed Jones betting thousands of dollars per hand on dice at a Las Vegas casino. Michael Osborne, the bettor, added that Jones was a fixture at the ARIA’s high limit room where he sought out players who rode a hot streak. On occasion, Jones would solicit the players for loans to finance his gambling habits, Osborne told the Post.

As many individuals with a serious gambling problem get into significant debt, the bettors search feverishly for a way out, noted Keith Whyte, former executive director of the National Council on Problem Gambling. When the losses accumulate, bettors may increase the volume of wagering, which only lands them in deeper trouble, Whyte explained.

“This desperation phase of a gambling problem can lead to a host of negative consequences – from chasing losses to committing financial crimes to compromising the integrity of the game,” he told iGB.

Increased funding for treatment

In the wake of last week’s arrests, the advocacy groups remain hopeful that legislators will use the case as impetus to direct additional funding into problem gambling outreach. The NCPG recommends that states allocate at least 1% of sports gambling proceeds to prevention and treatment, a target it believes that most states do not meet. 

John Millington, director of strategic partnerships at Epic Global Solutions, outlined a bevy of potential initiatives last week, most notably conditions that establish mandates for “ring-fenced funding”. Those programmes compel gambling operators to make contributions dedicated exclusively to education, prevention and support services in the area.

Doura-Schawohl is pushing for stronger restrictions on gambling ads that feature celebrities, while Whyte recommends efforts that will make outreach more accessible for those struggling with a gambling addiction.

“Stories like this can serve as a cautionary tale for other athletes,” said Whyte, who launched Safer Gambling Strategies, a problem gambling advocacy site. “Legalised gambling generates far too much revenue for problem gambling resources to be so scarce.”

Plummer, the assistant US attorney, asked a Nevada judge to impose certain conditions on Jones that restrict him from taking part in online gambling under his pre-trial release. Jones is facing charges on wire fraud conspiracy and conspiracy to commit money laundering. The NBA has issued a memo to players, according to ESPN, articulating the “dire risks that gambling can impose upon their careers and livelihoods”.

At stake is whether Estonia – already one of the world’s most digitised economies – can convert its technological advantage and forward-thinking tax policies into a credible and sustainable hub for online gaming. 

“Estonia is indeed moving toward positioning itself as a more attractive and competitive jurisdiction for gambling operators,” says Margus Reiland, partner and head of regulation, gambling and tax at Tallinn-based Law Firm Widen. 

Reiland explains that Estonia’s new gambling bill currently being debated in Parliament represents the most significant update to Estonia’s gambling framework in more than 15 years.  

New measures being considered

Among its key measures are: 

• Updated definitions of remote and additional gambling. 

• Broader scope for licensed operators to offer support services such as IT and accounting within the same group. 

• Mandatory audits of annual financial reports. 

• Clearer anti-money laundering data requirements for licence applications. 

• The Tax and Customs Board becoming the single point of contact for licences. 

• Tighter rules on gambling venues located near youth facilities. 

• Tenfold increases in fines and penalties. 

• Perhaps most importantly, a reduction in the remote gambling tax rate. 

According to the bill’s explanatory memorandum, its aim is to “modernise rules that have remained largely unchanged for over 15 years, strengthen supervision and improve the reliability and transparency of the gambling sector”. 

“In other words,” Reiland adds, “the reforms aim to encourage licensed operators to base their operations in Estonia instead of elsewhere in the world.”  

The timeline for reforms remains uncertain but Reiland says the bill is currently under parliamentary discussion and has not yet been adopted. “That being said, if the government coalition remains stable and continues to support the proposal, it is likely that the amendments will eventually pass,” he adds.  

Estonia new gambling bill’s tax reform 

One of the headline changes is the proposed lowering of Estonia’s gambling tax. For Reiland, this sends a clear strategic signal. The proposed bill by MPs from the Eesti 200 and the Reform Party would gradually reduce the remote gambling tax rate by 0.5 percentage points per year, aiming to reach 4% by around 2029.  

“From a regulatory standpoint, the intent appears to be to strengthen Estonia’s position in the gambling sector,” Reiland says. “And that intent is without a doubt positive.” 

Operators have largely welcomed the move, viewing it as recognition that “their long-standing concerns and challenges are being acknowledged by policymakers,” says Reiland. Although he also points out that the wider political debate “has been more divided”.  

The main question seems to be whether lowering the gambling tax truly benefits the wider economy or primarily favours the operators. 

The most prominent opponents are members of the centre-left opposition party Keskerakond The underlining sentiment is that the proposed gambling regulation is a lobby project, with no real positive effect. Industry insiders, however, are cheering the direction of travel.  

In an October blog post, Tim Heath, founder of crypto-driven gaming giant Yolo Group, praised Estonia’s new gambling bill, noting: “Only a year ago, the plan was to raise taxes. Proposing a different course took serious courage, and it shows the Estonian government understands how our industry really works.” 

Yolo has been headquartered in Estonia for years. Lower tax friction, Heath argued, would attract more operators, which in turn could bring “more investment, more jobs and, ultimately, more tax revenue. By going down this path, Estonia is choosing to grow its share of the pie rather than fight over the crumbs.” 

Digital credibility as a competitive edge 

Reiland believes Estonia’s strengths go beyond gambling taxation. “Obtaining and maintaining a licence in Estonia is already relatively fast, cost-efficient and administratively straightforward,” he explains. 

On top of that, “Estonia has strong IT infrastructure, robust cyber security standards and a well-developed anti-money-laundering framework. This raises the regulatory credibility to a high level.” 

In his view: “Estonia has always been a solid and effective choice for getting a licence – it just hasn’t received the same level of international attention as some other jurisdictions.” That could soon change. Estonia’s X-Road data-exchange system – a secure interoperability platform connecting public and private databases – underpins much of the nation’s digital governance and has become a unique asset for regulators. 

“It’s not just used in gambling supervision,” Reiland notes. “It’s also in data exchange across government agencies, health service providers and many private sector stakeholders. I wouldn’t go as far as to say it is a branding exercise but a widely used system that does actually support regulatory efficiency.” 

Yolo Group’s Heath agrees that this technological backbone gives Estonia an advantage few others can match. The market’s use of crypto as a payment method for gambling is a huge benefit to the group. “Estonia’s embrace of crypto in this new regulation helps cement its reputation as the world’s most digital country,” he wrote. “It encourages operator transparency and turns it into a national advantage.” 

Crypto and compliance in the EU  

Unlike many European jurisdictions tightening their stance on digital assets, Estonia is keeping cryptocurrency as an approved payment method – albeit under strict AML and KYC rules. 

“The Estonian approach allows crypto as a payment method for Estonian licensed operators,” Reiland explains. But he cautions that since MiCA – the European Union’s comprehensive legal framework for crypto-assets, designed to bring consistency, consumer protection and financial stability to the crypto sector – it is still a novel regulation and national practices differ.  

“It should be analysed under other target market jurisdictions whether all necessary requirements have been met,” says Reiland. In practice, he says, “the key question isn’t whether to use crypto but whether the operators know how to apply the highest standards of AML, KYC, enhanced due diligence etc under self-regulation principles”. 

In his blog post Heath echoed this pragmatism, arguing that Estonia’s openness “aligns with MiCA and EU best practice”. The integration of blockchain analytics tools such as Chainalysis, he suggests, allows for “real-time tracing and risk-scoring of crypto transactions,” thus enhancing transparency rather than undermining it. 

Crypto casinos, which are largely unlicensed or illegal across most European markets, are gaining rapid popularity among younger players. Last month Yolo announced it would be leaning entirely into regulated markets, and in another blog post Heath said he believed crypto was becoming “mainstream”.

Predictability and digital expertise 

Some in the industry remain cautious of Estonia’s new gambling bill and point to last year’s short-lived proposal to raise gambling taxes as a sign of political volatility. But Reiland dismisses this concern. 

“Estonia has had a very stable regulatory framework for a long time,” he insists. “The only real changes have come in the past couple of years, largely because different interests were competing over how to modernise the system. Right now if the bill is passed, the expectation is that the framework will remain generally stable for many years and the likelihood of a reversed course is very low in my eyes.” 

That sense of predictability – combined with Estonia’s digital expertise – could be decisive in drawing operators who are increasingly weary of the administrative burdens in older licensing hubs. The draft bill also introduces modest reforms to responsible-gambling measures, including expansion of the Estonia´s self-exclusion register, HAMPI. 

“There were different ideas floating on the self-exclusion list amendments but right now the latest parliamentary bill seems to be quite conservative,” Reiland notes. “It is my view still that probably the HAMPI regulation will be overhauled pretty soon since the existing system has been in place for quite some time.” 

Heath, meanwhile, highlighted this as one of the most important improvements, arguing that the reforms “lay the foundation for a safer, fairer environment – one where players can simply enjoy the thrill of the game, confident that they’re spinning in a trusted, regulated space”. 

Estonia’s new gambling bill a blueprint for Europe? 

If Estonia succeeds, could its model influence EU-wide discussions on digital gambling regulation? Reiland is cautiously optimistic. “Hopefully, if Estonia’s system proves effective, it could serve as a model for EU discussions rather than an outlier,” he says.  

“The underlying logic is not to prohibit or overregulate, but to use IT systems and secure information exchange to support legitimate business while maintaining continuous oversight.” 

Marriage of innovation and integrity could pay off 

For now, Estonia’s new gambling bill’s parliamentary journey continues. “It might be expected that after this bill has been adopted, the Ministry of Finance might also present a bill covering the remaining issues,” Reiland says – mentioning future clarification on crypto and the HAMPI system as likely priorities. “No seismic changes are to be expected.” 

As Heath of Yolo Group put it: “What Estonia is proposing right now could become a blueprint for how small, smart countries lead global industries – by marrying innovation with integrity.” And with legal experts like Reiland pointing to stability, efficiency and credibility as the cornerstones of the new framework, Estonia’s gamble on innovation might just pay off. 

This week’s revelation that Playtech commissioned a secret and seemingly invasive investigation into Evolution proves that competition among games developers has reached a tipping point.  

 “We are seeing an upward trend in IP disputes because people see huge value in this space. There is a lot to fight over,” says Joel Vertes, partner and co-head of Intellectual Property at CMS in London. 

His team, which is one of the largest IP practices in Europe, regularly deals with disputes involving game developers, platforms and even individuals accused of IP infringements or misappropriation of trade secrets. Vertes highlights the rapid expansion, advanced technology and vast variety as key drivers. “The gaming sector as a whole has just exploded in the last 10 years,” he adds.  

How the Spribe/Aviator case broke new ground 

One case in particular crystallises how IP disputes manifest in the sector. It is the recent high-profile legal battle between the two game developers Spribe and Aviator LLC, which involves Spribe’s award-winning crash game Aviator. 

The dispute started in Georgia last year, in a case that resulted in Spribe being found to have registered Aviator LLC’s trademarks in bad faith. This year the dispute resurfaced in a UK High Court, and in August Spribe won a UK injunction against Aviator LLC, blocking it from producing a copycat crash game and the use of Spribe’s trademarks. 

Although Aviator filed for permission to appeal in the Court of Appeal on 11 September, the application was abandoned on 8 October, and the court dismissed it the same day, having criticised Aviator’s conduct as “petulant”.

The case highlights the UK’s strong enforcement of IP rights. Proceedings regarding the same case are ongoing in other jurisdictions, including the EUIPO. The UK trial is expected to be heard in either 2027 or 2028.  

Protecting IP is challenging 

Vertes underscores the importance of interim injunctions in IP disputes: “Even though temporary, they can be decisive. If granted, the defendant is blocked from acting and many disputes settle shortly after.” 

He explains that in Europe, game mechanics are difficult to protect directly. “Generally, you’re looking at a bundle of rights. So, you’re looking at the brand, and you’re looking at underlying copyright in the source code,” Vertes says. The “general look and feel” of a game, along with registered design rights over graphical user interfaces, have become key IP battlegrounds. 

“The work we’re doing a lot of at the moment is in design rights,” he adds, pointing to how in the UK and Europe, design protection offers a whole new angle to fight over. The increasing speed of game development cycles – accelerated further by AI technology capable of generating code and imagery rapidly – adds urgency to IP vigilance. 

Richard Williams, IP lawyer at Keystone Law in London, emphasises the strategic importance of brand and trademark protection in gaming: “Clearance is a critical step. If you don’t check, you might be blocked from a market or subject to costly litigation.” 

An example of this is the backstory to the dispute between Spribe and Aviator LLC. In its Georgia case Aviator LLC claimed the rights to the name and logo created in 2017.

Williams stresses that smaller markets can still have a huge impact. “This insight reveals how early trademark clearance – often overlooked – can make or break international expansion.” 

IP disputes are being weaponised 

In Europe, legal frameworks around IP protection are more uniform than in many regions, but still complex. Vertes advises that those involved in the industry must become “IP-savvy quite quickly,” ensuring their names, designs and coding practices do not infringe on others’ rights. 

There is agreement among experts to whom iGB has spoken that IP cases are being weaponised in a competitive market. “Obviously, even if the IP dispute isn’t successful, it’s a good way of trying to keep competitors out of the market for as long as possible,” says Richard Williams. 

Joel Vertes agrees that it does happen: “I don’t see any reason why you shouldn’t weaponise your IP. If you’ve filed a patent over some mechanics in a game, or you’ve registered designs over the graphic user interface, why would you not go out and enforce it?” In the end, it is all about upholding brand and technology exclusivity in a highly competitive environment.

“It’s not about squishing small companies from entering the market – they’re perfectly entitled to compete. But that doesn’t mean they’re entitled to step on others’ toes to do it.” 

Across the Atlantic is a different picture 

Across the Atlantic, the situation is notably different, as the US is largely shaped by distinct legal doctrines and litigation cultures. Steven Caloiaro, an intellectual property litigator at the Reno office of Dickinson Wright, offers a contrasting perspective. 

Caloiaro observes that patent litigation in the US gaming sector has actually declined over the last decade. He attributes this to pivotal Supreme Court decisions like Bilski vs Kappos in 2010 which narrowed patent eligibility for software innovations.  

“Bilski made it very difficult to successfully litigate software-related patent cases,” Caloiaro explains. Since many iGaming innovations revolve around software – such as progressive jackpots, reward systems and bonus mechanics – the impact has been significant, he explains. 

“For the established gaming community, litigation has been down – specifically in the iGaming sector.” 

Instead, the rising trend in the US is “softer IP” disputes covering trademarks, trade dress and trade secrets, as evidenced in recent cases like Light & Wonder vs Aristocrat. In that case, a game designer’s movement between companies raised trade secret concerns—a classic scenario in the tight knit industry.

Non-compete enforcement has also increased in the US as companies seek to indirectly protect IP by limiting employee mobility. Caloiaro notes: “Non-competes can serve as a workaround to protect IP.” Despite challenges from the Federal Trade Commission, gaming companies have actively sought to enforce these clauses, he says. 

Fundamental distinctions between Europe and the US

When it comes to enforcement remedies, Caloiaro contrasts the US and Europe: “In the UK or EU, if you win, you’ll almost certainly get an injunction. In the US, it’s not guaranteed, which can reduce the value of a win if you’re trying to keep a competitor off the market.”  

Moreover, damages awarded in US courts tend to be significantly higher, but litigation is also more costly and carries higher risk since parties usually bear their own legal fees regardless of the outcome. 

Outlining other fundamental distinctions between European and US IP enforcement, Vertes says the biggest difference is the size of damages. “US claims can be worth far more than European ones. So if you’re chasing a big monetary win, the US is [more] attractive,” he explains.  

Vertes also points out the value of “design rights” in Europe, a somewhat underutilised protection in the US, where trade secrets and trademarks dominate the softer IP landscape. The Aviator injunction highlights how UK courts actively protect registered trademarks and associated branding.  

By contrast, Caloiaro notes that US patent law’s challenges in protecting software-based innovations tend to reduce patent suits but encourage a focus on trade dress – the visual appearance of a product – and trade secret claims.  

AI’s rise complicates the IP picture on both sides of the Atlantic. Caloiaro agrees that AI lowers barriers to entry and blurs lines between inspiration and infringement, although US patent offices require a human inventor, limiting AI-generated patent claims. 

Best practices moving forward

Both European and US experts emphasise proactive IP management. Vertes urges companies to “choose a name, make sure you’ve cleared it, that you’re not infringing on others”.  

“Talk to your developers. Make sure they’re not just going online and scraping or copying. There’s no rule that says if you make five changes from a copyright work, it’s suddenly okay. It doesn’t work like that,” he says.

Caloiaro stresses the importance of understanding the different IP types – trademarks, copyrights, patents – and filing registrations and documentation accordingly.  Both lawyers are in agreement that, in today’s fiercely competitive and fast-moving iGaming market, a sophisticated IP strategy is essential for any company to survive. 

The acquisition supports DraftKings’ broader strategy to enter prediction markets, while expanding its addressable opportunity through regulated event contracts, the company noted in Tuesday’s statement. As part of the announcement, the company confirmed plans to launch DraftKings Predictions, an app that will enable customers to trade regulated event contracts on real-world outcomes in areas such as finance, entertainment and pop culture. Other product details, however, remain uncertain.

For instance, the announcement shed little insight on whether or when DraftKings will consider a potential addition of sports event contracts. The company did not address whether it will offer those contracts on a limited basis in states without legal sports wagering, nor did DraftKings answer if it will set limits for certain contracts, a critical question for high-worth customers who engage in price discovery.

The “offering may expand into additional categories over time, deepening customer engagement and extending DraftKings’ addressable audience”, the company wrote in the statement.

Railbird Exchange is a federally licensed exchange designated by the US Commodity Futures Trading Commission.

DraftKings playing 4-D chess with prediction market move?

Prior to Tuesday’s news release, Truist Securities analyst Barry Jonas issued an earnings preview for the third quarter of 2025. In the research note, Jonas wrote that the emergence of sports prediction markets “dominated the narrative” over the three-month period ending on 30 September. At this month’s Global Gaming Expo in Las Vegas, BetMGM and Caesars Entertainment noted that they would not pursue the launch of sports event contracts, he added.

But for FanDuel and DraftKings, the two market leaders in sports betting, there are other considerations at play when mulling the addition of the derivatives on sports. Unlike the two casino giants, the digital companies do not have a retail presence in Nevada, where the state is embroiled in litigation with Kalshi and recently issued warnings to sports betting licencees considering prediction markets.

A group of 36 states, led by Ohio Attorney General Dave Yost, filed an amicus brief over the summer urging an appellate court to side with New Jersey in a lawsuit against Kalshi. The prediction market is facing a wave of litigation on the legality of sports event contracts in states where sports betting is legal. It might explain why Flutter, the parent company of FanDuel, initially decided to focus on non-sports event contracts upon the rollout of a new prediction market.

Earlier this month, Flutter and DraftKings saw double-digit stock declines after Kalshi introduced a new same-game parlay product for sports events.

“The 4-D chess continues as digital operators continue to weigh the pros and any cons of offering predictive sports,” Jonas wrote in a 21 October note. “We remain buy-rated on both with recent share weakness likely overdone.”

Nation’s most populous states in play

Given the duo’s brand and technology leadership, Jonas still expects DraftKings and FanDuel to be long-term winners in the wider space. Jordan Bender, an analyst with Citizens JMP, told iGB Tuesday that product and technological innovations will likely be the “key ingredients” in the battle to win customers.

If the companies begin to offer sports event contracts, they will enter a crowded space with the likes of Kalshi, Robinhood and Crypto.com. One option for the operators could be to launch sports event contracts in the 11 states that have yet to legalise sports betting. Those include the two largest, California and Texas, which have more than 70 million residents combined.

“You’re essentially adding 50% of the population overnight,” Bender told iGB, referring to non-legal states.

Without mentioning any states by name, DraftKings CEO Jason Robins suggested last month that the total addressable market for sports derivatives in those jurisdictions could be “very significant”.

The rise of prediction markets has created a fierce turf war over regulations for sports derivative products. This spring, MGM Resorts CEO Bill Hornbuckle opined that the derivatives could be the “concrete” that enables the federal government to intervene in the gambling industry.

Stock moves following Railbird acquisition

Following the announcement, DraftKings surged 6% in Tuesday’s after-hours session to $36 a share. Before Tuesday’s news, DraftKings fell approximately 25% over the prior 30 days due primarily to prediction market concerns. Jonas reiterated a $50 price target and a “buy” rating on DraftKings.

Chris Krafcik, managing director of Eilers & Krejcik, wrote on LinkedIn that the acquisition of Railbird buys the company and its stock a bit of “breathing room” amid a punishing, narrative-driven hype cycle.

Sullivan & Cromwell LLP served as legal counsel to DraftKings. Moelis & Company LLC served as financial advisor to Railbird. Miles Saffran, Railbird CEO, described the announcement as a “transformational moment” for the company. Proskauer Rose LLP and Kirkland & Ellis LLP served as legal counsel to Railbird.

The companies engaged in negotiations over the summer, according to Front Office Sports. Terms of the deal were not disclosed.

Yet, the revenue being generated through the “proliferation” of betting houses in the southern African nation was not flowing directly into the treasury, as punters’ winnings were untaxed. To formalise the industry and help boost revenue collection to meet “pressing budget needs”, he introduced the 10% withholding tax on gross sports betting winnings, one of only four taxes that he announced on that day.  

The tax, which came into force on 1 January, applies to winnings at all local betting shops and via online platforms operated by land-based bookmakers.

The Herald, a local daily, reported on 13 March that Zimbabwe’s gambling industry had generated about $120 million in revenue in 2023, with the online segment contributing $45 million.  

Ncube previously projected the economy could collect up to $15 million annually via the punters’ tax, based on his forecast of $150 million gross winnings in 2025. He said about 300,000 locals engaged in online betting in 2024, up 15% on the prior year, with 60% of bettors being between 18 and 35 years old.

“This growth has been fuelled by rising internet penetration and the accessibility of smartphones, with over 5.2 million devices in use nationwide,” the paper wrote.

Zimbabwe withholding tax will prove costly for operators

To comply with the new tax collection system, Marvellous Tapera, the founder and managing partner of WTS Tax Matrix, a leading Zimbabwean tax consultancy, said bookmakers were required to set up or upgrade their transaction and reporting systems to automatically calculate and withhold the 10% levy on all winning payouts across points of sale and online wallets.

“They also had to enhance accounting and reconciliation workflows to produce accurate monthly returns for ZIMRA (Zimbabwe Revenue Authority), train staff on tax procedures and customer communications, improve cash management and banking for timely remittances, and often consult tax or legal experts to ensure full compliance,” he tells iGB.

“Although feasible, these changes were operationally demanding and particularly costly for smaller operators, requiring significant time and financial resources,” Tapera adds.

Citing an anonymous operator, The Herald’s article reported Zimbabwe’s withholding tax would require a system upgrade costing up to $50,000 per platform. This is in addition to the $20,000 the average bookmaker spends on tax reporting yearly.

Tapera observes the betting tax’s flat structure raises fairness concerns. In its current form, he argues, the tax “is socially regressive” as it affects low-income and casual bettors compared to wealthier participants. It has the potential to squeeze operators’ profit margins and cause them to adjust odds to make up the losses.

“Applying a uniform 10% withholding tax without any exemption is regressive in a low-income economy like Zimbabwe’s, as it risks burdening poorer bettors and driving gambling activity to unregulated platforms,” Tapera adds.

He advises the government to adopt a more nuanced structure like the one proposed in South Africa, which is based on the amount and frequency of players’ winnings.

What can Zimbabwe learn from other African markets?

“South Africa’s model – a 15% withholding tax applied only to winnings above R25,000 – demonstrates how such a safeguard can protect casual players, and Zimbabwe would benefit from implementing a similar threshold or accompanying social protection measures,” Tapera suggests.

“Introducing a minimum exemption threshold or adopting a more progressive structure would make the system fairer while still capturing significant revenue from larger winnings.”

In a release on 5 September, Stats SA, South Africa’s national data agency, said the gambling sector generated $3.4 billion in GGR during the 2023-24 financial year. The latest figures from the National Gambling Board (NGB) in October reported an increase to $4.3 billion for the financial year 2024-25.

South Africa’s government announced the proposal to introduce a tax on winnings in 2011, with the aim being to start collecting it in the following year. The levy targets professional or regular bettors, while seeking to exclude casual punters.  

However, according to Deloitte, the government had not yet implemented the tax in February, due to staunch opposition from the local industry. 

Withholding tax must account for inflation

“The current economic climate, characterised by high unemployment and cost of living, calls for a balance between revenue generation and social protection,” the consultancy said in a 10 February note.

“A withholding tax on individual winnings may provide this balance if carefully structured. The minimum value for taxation should be reconsidered, taking into account inflation over the last 13 years since the first proposal. This will ensure that those gambling to supplement their low income are kept out of this tax net and do not turn to illegal gambling activities, which are completely out of SARS’ (South African Revenue Service) grasp,” the note said

In October, the Kenyan government similarly introduced a 5% withdrawal tax to replace its previous 20% tax on net winnings. It expects to collect about $74 million in the 2025-26 fiscal year, more than double the $35 million it collected previously.

Rapidly growing mobile penetration leaving land-based betting behind

Commenting on the new Kenyan model, Parliament’s “The Budget Watch 2025” document said a blanket tax rate could discourage casual participants and push actors from regulated platforms to offshore ones.

An official at one of Zimbabwe’s largest land-based operators expresses a similar concern to iGB. Speaking off the record, he says the withholding tax came into effect at a time when a large number of local punters is increasingly switching to unregulated and offshore operators.

“One now needs a mobile phone, a computer and an internet connection to start betting online,” he says.

“Some workers have been disciplined by their employers for participating in online gaming and betting using their employers’ computers and internet. And this [is on] platforms not subject to local regulations, including the new tax. 

“There are some people who used to visit brick-and-mortar branches who are now not doing so as frequently. [Zimbabwe’s witholding] tax will hasten the traffic to online platforms, leaving physical betting halls empty or for the few that don’t have smartphones and mobile data, and the old, technologically less-experienced ones.”

The Postal and Regulatory Authority of Zimbabwe said in its latest quarterly report in October that the nation’s mobile penetration rose from 101.39% in the first quarter of 2025 to 102.64% in the second.  The internet penetration also jumped from 76.19% in March, to 81.83% by June.

The newly combined business is valued at around €16 billion. In an era when European gambling operators are scrambling to keep pace with regulatory changes, technological disruption and the need for scale, this deal could be seen as both a defensive manoeuvre and a bold strike forward.

Although anticipated – Allwyn first invested in OPAP in 2013 – the full buyout marks a watershed moment not only for the companies involved but for the European gambling sector as a whole.

As Ben Robinson, an M&A advisor at Corfai Capital, puts it: “This is a mega-deal in a sector that has historically been sleepy. Allwyn is proving that a lottery company can act like a high-growth tech firm.”

The deal transforms Allwyn, which changed its legal status to a Swiss-based entity in October 2024, from a regional lottery operator into a vertically integrated, multi-product juggernaut with operations across Europe and ambitions to conquer the US.

It becomes the second-largest listed gaming group globally with pro forma EBITDA of €1.9 billion amid double-digit growth. It trails only Flutter Entertainment, whose 2025 EBITDA is projected at around $3.3 billion.

A decade-long courtship

Allwyn’s relationship with OPAP spans over a decade. The group, formerly known as Sazka, took an initial stake in 2013 and gradually deepened its involvement before increasing its stake in OPAP to 48.1% in 2022. This full acquisition is not a shotgun marriage but, as Robinson called it, “a decade-long courtship” during which Allwyn dissected OPAP’s business and built a shared technology roadmap.

Ed Birkin of H2 Gambling Capital frames the move as a natural evolution rather than a surprise. “They already owned 52% of OPAP, so acquiring the remaining 48% isn’t something that is overly surprising or unusual,” he says.

What matters is not the transaction itself but what it enables: a strategic leap forward. Birkin notes: “This is the logical next step in the transformation of Allwyn from a Czech lottery operator to a truly global powerhouse in the gambling sector.”

One brand, one tech, one team

At a joint presentation held between Allwyn and OPAP’s exec teams on 12 October Allwyn CEO Robert Chvátal framed the takeover as a milestone in the group’s journey.

“With this combination we will be able to grow further, faster as we deploy group-wide know-how, a unified brand and sponsorship strategy, and in-house technology and content,” he told analysts.

OPAP’s CEO Jan Karas echoed that ambition, adding the new deal was a springboard for innovation. “This exciting combination creates a leading gaming company with strong Greek heritage, as well as a continued presence and listing in Greece,” he said.

“Building the portfolio of attractive games that customers appreciate and bringing innovations is something that we leverage not only from best practices but also practical solutions.”

He also highlighted plans to adopt AI processes across multiple disciplines, noting: “Adopting AI for us is going to happen across multiple disciplines, ranging from customer solutions to platforms and internal productivity.”

The emphasis, according to both executives, is on operational integration: “one brand, one tech, one team.”

Financial appeal for OPAP investors

The detail around tech integration caught Robinson’s attention – particularly Allwyn’s plan to roll out in-house AI and data analytics platforms across OPAP’s retail operations.

This, he says, could potentially edge out longtime technology partners like Intralot and give Allwyn tighter control over its customer engagement and operational costs.

For OPAP shareholders, it’s not just a change of ownership but a change of trajectory. Robinson points to the dividend yield as a key part of the financial appeal.

“Management promised a minimum €1/share from FY 2026. With OPAP shares trading around €18.7 and a current dividend yield of ~7.6%, this implies a forward yield of about 5% – higher than many US blue-chip dividends,” he explains.

Global listing part of Allwyn‘s global transformation

Allwyn’s takeover of OPAP exemplifies a wider trend of consolidation in the gambling sector, driven by tighter regulations and challenging market economics. Across Europe and beyond, operators are seeking scale and diversification to maintain competitive advantage.

“It’s a smart piece of finance,” says Paul Richardson, an M&A specialist at Partis Solutions. “It ticks a lot of boxes for what they want, which is a listing for Allwyn and then the ability to do bigger and better things in other markets.”

A public listing in Athens gives Allwyn the liquidity and equity currency to pursue more deals, with a possible secondary listing elsewhere on the horizon. During the presentation, Allwyn said it would look to New York or London for its second listing.

Richardson estimates a six‑ to nine‑month window for a US listing, but points out that first the group must prove that the business is well-executed and actually achieving the promised benefits before attempting an IPO abroad.

Strengthening OPAP’s position

The deal also strengthens OPAP’s position, says Birkin. “With the market consolidating to a number of large, global operators, being part of this is going to position them better for the future than being a standalone single market leader.”

But he believes the actual acquisition of the remaining 48% of OPAP is “pretty irrelevant” in a European or global context.

“I wouldn’t compare this to past deals [of similar size] such as Bwin and PartyGaming, Ladbrokes and Coral, Ladbrokes Coral and GVC, Paddy Power and Betfair – all of those were pretty transformational deals for the industry at the time,” says Birkin.

“For Allwyn, the key part here is that, on the back of its acquisitions of Novibet and PrizePicks, and the other M&A it’s done in recent years, to consolidate the extra earnings from OPAP combined with the public listing, this now really puts them on the map as a global powerhouse,” he adds.

But Robinson does believe that Allwyn´s takeover of OPAP could affect the European market and may force Europe’s state lotteries to either privatise or partner up.

“The line between public lotteries and private bookmakers is blurring. Expect a more competitive, tech-driven European market.”

He compared the deal with France’s FDJ acquisition of Kindred for €2.45 billion in terms of expanding beyond its domestic market, and DraftKings’ $750 million acquisition of digital-lottery courier Jackpocket.

Legal obstacles

If the industry is moving towards scale and diversification, Allwyn wants to lead the charge. The strategy is to position itself as a 360-degree gaming and entertainment platform, combining national lottery licences with sports betting, fantasy and casino offerings.

“By controlling national lotteries, Allwyn secures a wide moat and an easy marketing journey,” says Robinson. “By adding high-growth verticals, it chases Flutter-like multiples.”

PrizePicks, Allwyn’s recent US-focused acquisition, which enters the group into fantasy sports, is part of that ambition – although is not without legal obstacles. The company ceased paid contests in New York because of regulatory issues and paid a $15 million fine. It is also facing a class-action lawsuit in Massachusetts.

Robinson notes: “While the acquisition is a catalyst, Allwyn must navigate legal headwinds before touting PrizePicks to US investors.”

But the stakes are rising. A New York listing is being explored, although the group previously stumbled in the US in an abandoned SPAC attempt to become listed on the NYSE.

That was back in 2022 when it struck a deal with Cohn Robbins Holdings Corp. The reverse merger was cancelled later that year, as both sides cited unfavourable market conditions. A traditional IPO is more likely today, particularly given the equity value of the €16 billion OPAP deal and its recent foothold in US fantasy sports.

Debt is manageble

The group’s potential global reach, vertical integration and AI capability positions it well for expansion but execution remains the hardest part. Integrating technology stacks, aligning regulatory frameworks and blending corporate cultures are all challenges that must be addressed, industry observers have said.

Debt is manageable for now: pro forma net leverage is around 2.7x EBITDA, with a target of 2.5x. CEO Chvátal reassured investors during the deal presentation that “the secondary listing in Athens will not involve new equity issuance” and that free float – the amount of stock available to the public – will stay about the same.

More takeover deals and buyouts may follow in Allwyn´s quest for domination. As Richardson admits, “I expect Allwyn to carry on doing M&A.”

With OPAP under full control, Allwyn has the scale, story and strategy to compete on the world stage. Now it must deliver.

At last week’s Global Gaming Expo (G2E), a trio of compliance officers made the case for why their casinos are more equipped to thwart pernicious threats of money laundering and other financial crimes. Over the last six months, the casinos have significantly revamped their compliance programmes after multiple illegal bookmakers exploited vulnerabilities in the systems to launder millions of dollars in ill-gotten gains.

In the first half of 2025 alone, the Nevada Gaming Commission reached settlements with three casinos – MGM Resorts, Resorts World Las Vegas and Wynn – to resolve charges of widespread anti-money laundering deficiencies. Since then, the companies have implemented considerable remedial measures such as extensive staff training, enhanced Know Your Customer (KYC) protocols and periodic reviews from regulators.

But one measure is conspicuously absent: adding independent anti-money laundering monitors inside the sanctioned casinos. For now, none of the casinos appear to be champing at the bit to add the proactive measure on their own.

“I hate to say everybody needs a government monitor,” said Omar Khoury, chief global compliance officer at Wynn Resorts. “Nobody wants a government monitor, but we’re doing it on our own.”

Costly measures for a casino to absorb

In May, the Nevada Gaming Commission approved a $5.5 million fine against Wynn Resorts. The settlement paled in comparison to the $8.5 million and $10.5 million fines levied against MGM Resorts and RWLV, respectively. A year ago, Wynn forfeited $130 million in a non-prosecutorial agreement with the US Justice Department to settle charges that it had conspired with numerous unlicensed money transmitting businesses worldwide.

Khoury stated that any determinations of whether to instal an independent monitor should be made on a “case-by-case” basis. In Wynn’s case, he explained that the company is engaging with a third-party auditor on an annual risk-assessment programme. Since the results are reported back to the casino’s compliance committee, Khoury views it as a hybrid approach for mitigating risk.

Barak Cohen, a former prosecutor with the US Department of Justice, agrees with Wynn’s strategy. Now a partner at Washington DC firm Perkins Coie LLP, Cohen said his firm served as an independent monitor in a major case. It does not mean that he is in favour of the measure. In many instances, monitorships are expensive and a proxy for prosecutors, he emphasised.

“If you can do it for yourself without having the government impose monitorship, then that’s fantastic – monitorships suck,” Cohen said bluntly, while drawing laughter from the audience.

Monitorship costs for a large investigation can run up to $5 million annually, according to Cohen. Moreover, such monitors might search feverishly for problems that in some cases do not exist.

It can lead to aggressive tactics from investigators who are figuratively “kicking in doors” in an attempt to find various issues, according to Cohen.

“If a company can avoid a monitorship, they should,” he told iGB.

Comparisons with the banking industry

Others view monitorship as a much-needed layer of protection for casinos under sanction. The topic of monitorship came up at the Indian Gaming Tradeshow & Convention in April. Anne Layne, senior manager at Grant Thornton, described the monitors as a “fantastic” resource for AML teams to detect real-time activity.

Independent monitoring also received support from several panellists on an AML panel at the Canadian Gaming Summit in June. In the banking industry, K&L Gates has described independent testing as one of the five pillars for AML enforcement.

Last October, TD Bank agreed to pay approximately $3 billion in a historic settlement with US authorities. In one instance, a defendant used the bank to launder roughly $470 million in drug proceeds, while bribing bank employees with some $57,000 in gift cards.

The bank’s AML programme also had “significant deficiencies” in monitoring a classification of high-risk customers, a group that includes internet gambling organisations, foreign casinos and virtual currency exchanges, according to the US Treasury Department.

Under the settlement, TD Bank agreed to appoint an independent monitor to review the bank’s AML programme for a period of four years. It marked the first time that the Treasury’s Financial Crime Enforcement Network (FinCEN) imposed an accountability review that tasked an independent monitor with evaluating such a programme.

Asked if the casino industry should adopt the same measures in AML settlements, MGM Resorts Chief Compliance Officer Stephen Martino responded that he is not familiar with the case. Martino said, however, the company feels “very positively” about its culture of compliance in response to the settlements.

Dreitzer on fines

It should be noted that none of the casinos that settled with Nevada in 2025 were accused of laundering proceeds for narcotics traffickers. In 2013, though, Las Vegas Sands forfeited $47.4 million in a settlement with the Justice Department. The settlement relates to a series of suspicious deposits made by Ye Gon, a Mexican entrepreneur with suspected ties to an international cartel.

Of the three Strip casinos ensnared in this year’s investigation, only RWLV has yet to reach a settlement with the federal government. According to Nevada regulators, RWLV failed to substantiate the sources of funds for Matt Bowyer, an illegal bookmaker who accepted $325 million in wagers from the interpreter at the time for baseball star Shohei Ohtani.

Bowyer, who pleaded guilty to laundering millions through Resorts World, began serving a 12-month prison sentence last week. Since his sentencing, Bowyer has gushed that he is the one mostly responsible for the revamped KYC standards across the Strip.

At G2E, one of the world’s largest gambling conferences, some questioned if monetary penalties are enough of a deterrent. Mike Dreitzer, the newly appointed chairman of the Nevada Gaming Control Board, addressed the matter on the opening day of the event.

“Fines make headlines, but it’s more important that licensees are acting in a corrective way,” Dreitzer said. “Certainly, we are not afraid to continue to ramp up enforcement.”

The tension in the room was palpable. Operators, lawyers,and regulators gathered in a large hall: 16 tables, two companies per table, with KSA staff mingling at the edges.

When the Dutch remote‑gambling market launched in 2021, licences were granted for five years. The first 10 operators – TOTO, FPO, Holland Casino, NSUS Malta, Play North, Tombola Malta, Hillside, Bingoal, Betent and LiveScore Malta would face renewal in October 2026. Both LiveScore and Tombola exited the market in 2024.

With that date approaching, speculation had grown that the KSA would tighten rules – making the relicensing process laborious and punishing. Many feared a reset, rather than a renewal, that would overwhelm even well‑established operators.

‘Past behaviour’ requirement sparks concerns among operators

The anxiety was partly caused by statements made before 1 October. The KSA chair had hinted that it would look into past behaviour when considering new and reapplications for gaming licences.

In its public announcements, KSA said: “Providers that made mistakes in the past five years must explain during the application process how they have learned from previous mistakes and how they intend to prevent recurrence. If we find this explanation insufficient, the permit may be denied or additional conditions and restrictions may be imposed.”

Bjorn Fuchs, chairman of VNLOK – the Dutch iGaming trade body – confirms that wild rumours circulated among operators prior to the meeting.

“We [thought we] were going to be punished for bad behaviour. Maybe we get five years, maybe one year, maybe we lose it altogether. These were some of the concerns,” he says.

Operators also feared that every facet of their business would be re-scrutinised. Would new demands be imposed on advertising, addiction prevention, AML and player funds? Might entire chunks of existing policy be deemed insufficient?

What came out of the operator KSA licence renewal meeting?

But after the meeting, as Fuchs recalls: “There was a sigh of relief going through the room when it was presented,” although the tension was not entirely dispelled.

Rather than a crackdown across the board, what is emerging is a more regulated renewal framework.

Fuchs summarises: “If you have a clean sheet, there are some hoops, but for various modules you can just send a declaration which states that you’re compliant.”

He emphasises the new system will make burdens less demanding than before, but the new “exit plan” requirement and sharper duty‑of‑care definitions do bring some added complexity.

Justin Franssen, a regulatory lawyer and partner at Franssen Tolboom, likewise tells iGB the KSA is not imposing extreme hurdles on existing licensees, as some had feared would be the case.

Although new measures such as more comprehensive responsible gambling policies and civil judgment compliance are being introduced, these largely build on existing structures, he explains. “The gambling authority strives to make the reapplication process as smoothly as possible,” Franssen says.

The formal session on 1 October opened with KSA addressing submitted questions across various licensing modules. A detailed programme had been circulated in advance.

Operators asked pointed questions: How much weight will prior fines carry? How is behaviour/activity abroad assessed? When does the new licence take effect relative to the old one?

Various operators and law firms pushed hard for more clarity, Fuchs said, and the KSA acknowledged that need for clarity.

Unpacking the KSA’s exit plan requirement

Most notably, all submissions must now include the aforementioned exit plan – a new obligation that applies across the board. This requirement, intended to ensure orderly market withdrawal, marks a move toward embedding long-term risk management into the licensing process.

It requires operators to describe in detail how they will responsibly wind down their operations should their licence not be renewed or be revoked. Or if they decide to leave the market midway through the five years between renewals.

In short, it is to ensure players are not left vulnerable in the event of sudden market withdrawal. This includes ensuring proper handling of player balances, communication strategies to customers, technical shutdown procedures and data retention compliance.

In another marked departure from previous practice, the breach-prevention module (overtredingspreventie) is no longer confined to new entrants. Existing licensees seeking renewal must now also submit detailed protocols on how they proactively prevent regulatory breaches.

Several modules, including those related to financial security, player fund provision and internal oversight, can now be approved through signed declarations rather than full evidence-based submissions. Should doubts arise, the KSA may demand supporting documentation.

Non-compliance with KSA licence renewal rules could end in licence revocation

Other areas are heading in the opposite direction. The Central Data Bank (CDB) module has seen a notable hardening of requirements: operators must now submit a detailed control plan, present evidence of system conformity and provide a test programme.

Meanwhile, advertising and recruitment remain documentation-heavy areas, showing little regulatory leniency amid public and political sensitivity about consumer protection and market integrity.

Background checks have also become more intrusive in the KSA licence renewal process. The reliability assessment now obliges applicants to disclose previously unreported persons – individuals who were involved with or connected to the gambling operation but were not disclosed in earlier applications – or past behaviour linked to the operation and to map out corporate and personal affiliations.

Perhaps most consequential is the now-strictly enforced clause on civil judgment compliance. Operators who have failed to comply with enforceable rulings – be they related to player winnings, losses, or data subject access requests – could have their licence revoked.

As Franssen warns: “If an operator does not comply with civil judgments, they will not get a licence. The licence can be pulled.”

Political pressure on the market

Overall, the feeling among operators is that the regulatory changes reflect a market recalibrated for oversight and accountability.

As chair of the trade organisation, Fuchs’ stance is a mix of cautious optimism and realism. In his view, many new demands are not radically burdensome.

He notes that operators may now submit declarations in many modules rather than full packages, reducing paperwork in some cases. The real burden falls on areas like exit planning and the finer detailing of duty of care.

But Fuchs worries about one big overhang for the online market: political pressure. He described how for years in the Netherlands, gambling had “no friends in politics” and was subject to opinion-driven restrictions by Christian and socialist parties.

Those parties, such as the Christian Union and SP, have steadily pushed for tighter regulations or even prohibition. The coalition politics of 2021, reliant on such parties, suppressed the fact-based dialogue and liberal push-back, Fuchs expressed. The result: increasing constraints and shrinking product flexibility for legal operators.

Deregulation in Netherlands is ‘unrealistic’

Fuchs believes a turning point came earlier in 2025, when Parliament and a government roundtable began acknowledging how large the unregulated market had become and how detrimental that is to regulation and player protection.

Anti‑gambling voices like national addiction rapporteur Arnt Schellekens – who has previously been very vocal about banning online play – have moderated, admitting that prohibition would only drive players towards the unregulated market.

“The National Rapporteur is not in favour of a gambling ban, because it would drive people into illegality,” Schellekens said recently. Fuchs thinks that outright deregulation is politically unrealistic, even if opposing parties gain influence.

Franssen accepts that new entrants to the market will face burdens – even more than in 2021 – but he doesn’t expect the KSA to place unachievable demands on existing licence holders.

He warns, however, of “overarching playing limits” in the pipeline. Currently, deposit limits are set operator‑by‑operator. A regime to enforce a limit across all operators would devastate monetisation, he said.

Overall, Franssen calls the market situation in the Netherlands “a death by a thousand cuts”. Some smaller operators, he predicts, will drop out or be consolidated.

No friends in politics – but hope

Gambling remains a topic fraught with moral questions in the Netherlands, and few parties risk openly embracing it. For the operators, the tax hikes and tightening of regulations reflect more political caution than logic.

The gaming tax, starting at 29% at market launch, has climbed to 34.2% and is expected to reach 37.8%. The media, social pressure and anti‑gambling campaigns reinforce a political narrative that gambling needs constant control, stakeholders tell iGB.

Fuchs argues that the political tide appears less venomous now, as serious attention is turning to illicit gambling growth and the limits of prohibition. Yet he is aware that “gambling has no friends in politics” – and that upcoming elections may again bring forward stricter stances rather than liberalisation.

Franssen echoes this: many of the restrictions, such as advertising bans and deposit limits, were quickly introduced after the 2021 launch in response to political backlash. Any operator considering entering the Dutch market now must weigh a difficult climate of political fragility, he explained.

Fuchs hopes that in the future, fact‑based regulation replaces stacking of new burdens. “If you keep squeezing the legal industry, people go to the illegal offering,” he adds.

Indeed, many in the sector point to the growth of the unlicensed or offshore market and remain skeptical of early KSA claims that channelisation was 80–20. He believes the illegal sector was always larger, and that recent tight regulation has driven more players outside KSA’s purview.

Still, the hope among operators is that if KSA gets relicensing right – clear, proportional, consistent – they may strengthen legitimacy and player trust in the long run and could gradually push out illegal operators.

What Gambling Commission GSGB numbers say

The 2024 GSGB shows a decline in past-year participation, from 61.5% in 2023 to 59.6%.

“Problem gambling” prevalence, defined as PGSI scores of 8+, rose slightly from 2.5% to 2.7%, while moderate-risk gambling fell from 3.7% to 3.1%. For certain groups, harms appear to be easing: the proportion of gamblers reporting severe adverse consequences declined, particularly among women, where it fell 18%.

Serious financial harm indicators dropped by nearly a quarter, and more than halved among 18–24-year-olds.

However, other harms moved in the opposite direction. Reported rates of harm to “affected others” (such as partners, families and friends), including violence and abuse, increased.

These complexities are often lost in the headline framing: the figure that has dominated media coverage is the 2.7% PGSI rate, extrapolated to imply 1.4 million “problem gamblers” in Britain.

From caution to ‘official statistics‘

Until this year, the Gambling Commission had insisted on a health warning: GSGB survey data could not be scaled up to national totals due to methodological uncertainty. That caveat has now been removed, with the regulator describing the survey as “official statistics” and encouraging licensees to use the figures in risk assessments.

Melanie Ellis, partner at Northridge Law, believes this shift was a mistake: “It was premature of the UKGC to call these ‘official statistics’ and to take away the health warning, without sufficient scientifically rigorous testing to give confidence that the data is accurate,” she says.

Ellis stresses that while the commission was right to modernise its GSGB survey methodology, it failed to pause when early results diverged drastically from NHS health survey benchmarks. “The regulator blinkered itself to the impact these figures would have on the industry,” she adds.

Gambling Commission’s GSGC ‘an almighty headache‘

Dan Waugh, partner at Regulus Partners, is even more blunt. He describes the GSGB as the regulator’s HS2, an over-budget, politically committed project that cannot be reversed even if flawed.

“The survey has uncovered a previously unheralded huge degree of gambling participation overall. … It suggests a massive unlicensed market which was not picked up in the health survey. So, either the commission has not understood the market it is regulating, or it has let rampant gambling disorder flourish,” Waugh warns.

The removal of caveats, he argues, creates “an almighty headache for DCMS” as campaigners will now lobby ministers armed with the regulator’s own statistics.

“This will absolutely feed into the discussion on tax,” he adds. “You will see intense lobbying over further ad bans. And it will effectively have the GC’s badge on it.”

Bias, capture and sunk costs

Regulus’ own analysis frames the GSGB controversy as a case study in regulatory bias and institutional inertia.

The Gambling Commission, it argues, has shown a willingness to find vindication where none exists. Researchers at the London School of Economics conducted inconclusive experiments comparing survey modes, yet these have been cited as justification for lifting safeguards.

“The willingness of the commission to find vindication where none exists smacks of a prior bias,” Waugh wrote in an analysis sent to Regulus clients. “The alacrity with which some academic researchers have abandoned previously held views may indicate the presence of ‘in-group bias’ or worse.”

The problem is compounded by selection bias and self-reporting inconsistencies. Hard industry data on actual participation often fails to align with Gambling Commission GSGB responses. Waugh suggests in his written analysis that there are three possible explanations:

1. The survey overstates gambling prevalence due to selection bias.
2. There exists a vast unlicensed market previously undetected.
3. Respondents misunderstand questions or answer inattentively.

None of these explanations, the consultant argues, inspire confidence that the GSGB can yet serve as a sound basis for policy.

Industry in denial?

Another theme emerging from Waugh’s critique is industry complacency. For years, operators have dismissed or downplayed research framing gambling as an “unhealthy commodity” akin to tobacco. By failing to engage seriously, they now face the risk of punitive tax rises and stricter controls.

“Within the next 12 months, UK Research & Innovation will start to distribute £20 million a year in levy funding, with gambling described as a ‘health-harming industry’,” Waugh notes. Without a coordinated response, the industry faces “over-taxation and over-regulation”.

Waugh suggests that operators have failed to mount a serious challenge. “The industry has just sat there and done nothing,” he says. “I can’t see that this will not negatively affect the industry.”

Black market blind spots

For Ellis, the critical missing piece is the role of unlicensed operators.

“If [the Gambling Commission] wants to assess whether player protection measures imposed on the licensed industry are effective, it urgently needs to be able to segment its GSGB data into customers using licensed and unlicensed operators,” she notes.

The commission has acknowledged this challenge but progress is slow. Without it, assessing whether regulatory interventions reduce harm risks becomes meaningless. Worse, restrictions on licensed operators may push consumers into the unregulated sphere, undermining protections altogether.

From survey to supervision

For licensees, the key issue is how the Gambling Commission GSGB will be operationalised. Commission CEO Andrew Rhodes has “strongly encouraged” firms to use GSGB data to assess risk within their customer bases.

Does this mean operators must assume that one in 10 online sports bettors are “problem gamblers,” as the GSGB suggests? If so, this would transform the expectations around customer monitoring and affordability.

Yet ambiguity persists. Ellis cautions that if the commission bases enforcement on GSGB-derived thresholds, “it must ensure that decisions are defensible and acknowledge methodological caveats”.

The politics of harm

The political consequences are already visible. The Guardian and other outlets have amplified the “1.4 million problem gamblers” figure, fuelling calls from campaigners for advertising curbs and affordability checks.

Ministers such as Culture Secretary Lisa Nandy have been attacked for not moving faster, while the Treasury eyes potential increases in Remote Gaming Duty.

For campaign groups, the GSGB is a gift: the regulator’s own data, stripped of caveats, can be used to push for prohibitionist-style measures. For operators, the risk is being judged and punished on contested statistics.

An unstable foundation

The GSGB represents a landmark for UK gambling regulation: a home-grown survey, positioned as the definitive evidence base. But critics warn it has an unstable foundation and is vulnerable to bias, misinterpretation and political misuse.

For Ellis, the task is ensuring accuracy and distinguishing between licensed and unlicensed activity. For Waugh and Regulus, the concern is deeper: that the commission has locked itself into a flawed survey, driven by sunk costs and institutional bias and, in doing so, has unleashed a wave of political and fiscal risks for the sector.

What seems certain is that the GSGB will dominate the debate for years to come. The challenge for the industry is not to deny its existence, but to engage critically, demand transparency and prepare for a regulatory environment shaped by numbers that – for better or worse – now carry the imprimatur of “official statistics”.

With the introduction of Gibraltar’s new Gambling Act 2025, the jurisdiction is embarking on a broad reform of its regulatory framework – designed to reflect the realities of a fast-evolving gaming industry in a post-Brexit landscape.

This legislative overhaul replaces the long-standing Gambling Act 2005, and aims not just to modernise but to reposition Gibraltar as a top-tier regulatory hub, after it was recently removed from the European Commission’s list of high-risk jurisdictions.

According to Victoria Reed, a regulatory consultant and founder of Better Change, the 2025 Act – effective since 1 October with a transitional period of six months – represents a “substantive and directionally aligned” leap forward.

”Gibraltar was one of the first jurisdictions to build a reputation as a credible, well-regulated hub. We’ve got a low corporate tax rate, access to skilled people and, crucially, a regulator that struck the right balance between commercial awareness and strict oversight which undoubtably helped attract many of the industry’s biggest brands,” she tells iGB.

Its close link to the UK gave operators access to the market, which cemented Gibraltar’s importance for many of the UK’s tier one players.

”After Brexit though, it lost the ability to passport licences across the EU, so its value became even more tied to its guaranteed UK market access. That shift meant Gibraltar had to double down on reputation and substance and the new act is designed to do exactly that,” says Reed

The framework, she explains, expands scope, embeds economic substance, strengthens oversight of the full value chain and maintains an active enforcement stance.

What’s included in Gibraltar’s new Gambling Act?

The new Gambling Act is comprehensive, placing new classes of businesses under supervision, introducing individual accountability for senior managers and enforcing real local economic presence.

As Andrew Lyman, head of Gibraltar’s Gambling Division, puts it: “Any gambling business now managed and controlled in or from Gibraltar potentially falls within scope.”

Key innovations within the new act include:

• Substantive presence requirements: Licensees must now demonstrate real economic substance in Gibraltar – through staff, offices, infrastructure and local tax contribution. The goal is to eliminate “brass plate” operations that offer little benefit to the jurisdiction.
• Expanded licensing perimeter: The act creates distinct licences for B2C, B2B and “Gaming operator support services”. Activities such as marketing and CRM, managed trading and software hosting now require their own approvals.
• Approved persons regime: For the first time, senior decision-makers will require personal vetting and licensing, similar to the UK’s Personal Management Licence. This enhances accountability at the individual level.
• Marketing oversight: All marketing activities conducted “in or from Gibraltar” will be subject to new regulation – bringing affiliates, group marketing hubs and even creative agencies into scope.
• Enforcement powers: The Gambling Commissioner’s powers are significantly bolstered. The commissioner can now issue administrative fines, cease-and-desist orders, conduct inspections and impose suspensions where warranted.
• Digitalisation and reporting: Operators must prepare for increased digitised reporting, particularly in relation to AML, financial disclosures, technical standards and safer gambling initiatives.

Gambling Appeals Tribunal introduced to review regulatory enforcements

Crucially, a Gambling Appeals Tribunal is being introduced. The independent body established under the updated Gambling Act is designed to hear appeals against decisions made by the gambling commissioner. These may include licence refusals, suspensions, revocations or other enforcement actions.

The tribunal’s creation marks a key milestone in Gibraltar’s broader regulatory reform, legal experts have said, reinforcing its position as a jurisdiction committed not only to robust regulation, but also to fairness, transparency and legal accountability.

Ultimately, it adds another layer of trust that should help to attract serious operators to the market.

Gibraltar’s new Gambling Act: Impact on stakeholders

Steven Caetano, partner at Isolas law firm, notes: “The act raises standards for all stakeholders, with the greatest operational impact on operators and their key personnel.”

Operators must overhaul their group structures to map out which business units will require licensing. For multinationals, this may mean multiple licence applications and reorganised internal governance. B2B providers and third-party support services – including marketing, technology and CRM services – must now assess whether they require standalone licences.

Similarly, senior personnel face new responsibilities, with the “Approved Persons” regime emphasising personal accountability front and centre.

Regulators gain more authority – but also a heightened responsibility to ensure fair, consistent and transparent enforcement.

In the end, players stand to benefit through stronger consumer protections, responsible gambling requirements and greater market integrity.

Navigating the challenges

Stakeholders have welcomed the new regulation, but it doesn’t come without significant challenges. Among them are increased compliance costs as new licence applications, reporting obligations and staffing requirements will drive up outlay – especially for smaller operators or those transitioning from leaner compliance models.

If the new act succeeds in attracting more business to Gibraltar, there will likely be demand for more local staff, though a relatively small labour pool in Gibraltar may pose recruitment challenges.

However, the anticipated UK-EU border agreement is expected to ease the movement of frontier workers from Spain, by removing the need for border checks between Spain and Gibraltar.

There is also a degree of transitional complexity. Although current licensees will be “grandfathered” into the new system, they will still need to undergo fresh applications within six months of the Gambling Act’s commencement.

Uncertainty around licensing categories in Gibraltar’s new Gambling Act

Speaking to iGB, legal experts agree there is a level of uncertainty around how some of the the new rules should be implemented.

Victoria Reed points to the uncertainties around licensing categories: “The government has said marketing carried out ‘in or from Gibraltar’ will generally need its own licence but has also indicated it may carve out some intra-group activity on a case-by-case basis. Until more secondary rules and precedents are published, operators can’t be entirely sure which affiliates, agencies or shared-service teams fall inside scope and which don’t.”

She also highlighted new rules around support services leaving room for interpretation.

”The act lists functions like managed trading, RNGs, hosting and advertising as ‘support services’, but leaves room for interpretation,” Reed adds.

”Multinational groups will need to decide whether in-house teams that straddle multiple hubs — for instance a centralised risk team partly in Gibraltar — require licensing.”

Caetano flags additional guidance could be needed to clarify B2B versus B2C licensing:

“The distinction between B2B and B2C activities is clearer, but some hybrid or cross-border models may require further guidance.”

In essence, it is unclear if dual licensing is needed or whether it could be covered under one tailored licence.

Credibility in a crowded field

Gibraltar’s iGaming sector, which employs more than 3,200 people across 54 operators, continues to be a cornerstone of the peninsula’s economy, generating 20% of its GDP.

Last year the sector contributed £110 million in corporate tax and £40 million in PAYE contributions. There are currently 83 licensees appointed – 49 B2C and 34 B2B.

In a reality where jurisdictions like Malta, the Isle of Man, and emerging offshore hubs are all vying for operator attention, Gibraltar’s message is clear about its brand: credibility, not convenience.

Where a place like Malta offers flexibility, and the Isle of Man applies rigid structure, Gibraltar positions itself in the middle as a risk-based market, but also with regulatory discretion and pragmatism, Reed explains

As Gibraltar’s Minister for Justice, Trade and Industry Nigel Feetham noted in his recent parliamentary budget address, Gibraltar has never operated a “no-questions-asked” model and the jurisdiction expects its licensees to respect local laws in other markets and take local licences where appropriate. This ethos is embedded in the 2025 Act.

“If we drive business away, it will be business we don’t want,” Lyman notes.

The real test begins now, where both regulators and businesses will be adapting to the new act, but the tone is optimistic.

“We’ve already seen renewed interest in the jurisdiction,” says Lyman. Caetano agrees the act “ensures Gibraltar remains at the forefront of the global online gambling industry for years to come”.

But the long-awaited update is unlikely to solve some of the market’s deeper-rooted struggles relating to the proliferation of illegal gambling.

The changes were proposed by the Ministry of Finance’s investigator, Marcus Isgren, who authored the report outlining amendments designed to strengthen the regulatory framework.

If enacted, the changes – scheduled to take effect on 1 January 2027 – would represent the most significant reform of Sweden’s regulated gambling regime since its re‑regulation in 2019.

The proposal would redefine which gambling services fall under Swedish law, significantly expand the administrative tools available to regulators, and shift responsibility for compliance from the state to the operators.

A positive response to Sweden’s Gambling Act update

For a market grappling with falling channelisation since 2019, this could be a turning point.

Anna Johnson, CEO and president of Svenska Spel, the state-owned operator, celebrated the report, as have other prominent stakeholders in the market.

“The investigator’s proposals are long-awaited and welcome. We have long pointed out that the regulations around illegal gambling need to be tightened. It’s about improved protection for consumers, but also about safeguarding trust in the entire Swedish gambling market. Ensuring that gambling is conducted in a responsible and sustainable way is the very foundation of our operations,” Johnson said.

A spokesperson for the Swedish Gambling Authority, Spelinspektionen, similarly praised the government’s review. In a comment to iGB, the regulator said: “We have brought to the government’s attention the need to amend the scope of the Gambling Act with regard to online gambling. We therefore view the investigator’s proposal positively, as it strengthens our ability to work more effectively against unlicensed gambling.”

Change is positive

One of the architects of the longstanding industry pressure that led to this reform is Gustaf Hoffstedt, CEO of industry trade body BOS. Speaking to iGB, Hoffstedt struck a positive tone, even if it is unlikely the law will come into force for at least another year.

“I’m all fine with my patience right now, when I can notice that we are ticking boxes during the path. I don’t have a problem with waiting until 1 of January 2027, because, as an ex-politician myself (Hoffstedt represented the Moderate Party in the Swedish parliament between 2010 and 2015), I am fully aware that the legislative process takes that time. What was so frustrating was the initial five or six years, when nothing happened,” he said.

Hoffstedt supports the shift to a participation-based model, but his optimism is measured. The reform, he estimates, might improve channelisation – but not enough to meaningfully stem the flow of Swedish players to unlicensed sites and barely making a dent in the current leakage to the unlicensed market.

“From the industry’s point of view, we are quite certain that it will substantially contribute to a strengthened channelisation. However, substantially means maybe two or three percentage points. Even if this reform is successful, it certainly doesn’t solve the general problem.”

Consumer appeal the real challenge

According to Hoffstedt, the deeper issue is not legal enforcement, but consumer appeal. Sweden’s licensed market, he says, lacks the attractiveness needed to retain players – especially in a sector driven by thrill, incentives and fast-moving innovation, with offshore platforms offering more bonuses, more games and faster payouts.

“We have an alcohol monopoly in Sweden that is easier to uphold since alcohol is a physical product,” he notes. “But I can just take my smartphone and gamble on hundreds of illegal, unlicensed gambling companies.”

The legislative instinct across Europe, he argues, is to build legal walls – through DNS blocking, payment restrictions and repressive licensing regimes. But this alone won’t work.

“This review was a niche product. But we’re now advocating for a general, broad inquiry into how to improve the channelisation of the Swedish gambling market.”

He hopes the government will launch such a review before the next general election in September 2026. “That could be the most valuable contribution to a functioning market.”

Reframing the law: what’s in Sweden’s Gambling Act update?

Under current law, online gambling operators fall under Swedish jurisdiction if they target the Swedish market. This so-called “riktningskriteriet”, or “directional criterion,” relies on visible cues – such as use of the Swedish language, local currency (SEK), or Swedish branding – to establish intent.

However, many foreign operators have circumvented the rule by offering platforms in English, using the euro, and avoiding overt national markers. In doing so, they’ve been able to legally accept Swedish players without a licence – remaining outside the regulator’s reach.

For years, this loophole in Sweden’s Gambling Act has enabled player leakage to unlicensed operators. According to BOS, which represents 19 gambling companies operating in the market, prior to the re-regulation, channelisation was slightly below 50%. Immediately after the re-regulation it was plus 90%. But those numbers quickly dropped.

Spelinspektionen currently estimates it to be at 85%. Channelisation for online casino in Sweden is estimated at 72%–82% – a number which BOS describes as “catastrophic”.

In comparison, channelisation in neighbouring Denmark, where the market is significantly more liberal, is estimated at around 90%, with an equal distribution between different product groups.

The core reform is a shift from asking whether a gambling site is targeting Swedish users to whether people in Sweden participate in the game. Under the new law, it wouldn’t matter how the site is marketed – if someone in Sweden can play, the law applies.

From intent to activity

Effectively, the legal burden would shift from proving intent to target to proving active exclusion. Operators wishing to stay outside Swedish jurisdiction must implement “appropriate and effective measures” to block Swedish residents from accessing their platforms. Even sites with no Swedish branding or language – if accessible to Swedes – could face legal action.

These are the key enforcement shifts in the amendment:

• Responsibility: Operators will be required to take “appropriate and effective measures” to prevent Swedish residents from participating – not only to avoid targeting them.
• Exemption test: To fall outside the law’s reach, an operator must show that exclusion measures have been implemented – not merely that they do not target Sweden.
• Promotion ban expansion: The prohibition on promoting unlicensed gambling would extend to payment processors, financial services, administrative or technical support and other intermediaries facilitating unlicensed operations.
• Presumption of participation (for payments): Payment intermediaries that handle transactions linked to unlicensed gambling must assume Swedish residents are participating from Sweden unless clear evidence suggests otherwise.
• Criminal liability adjustments: The criminal provisions of Sweden’s Gambling Act would be updated to explicitly cover unlicensed gambling and the promotion thereof, under the new participant‑based framework – potentially expanding liability to those who knowingly facilitate unlicensed activity.

Is there an appetite for deeper reform?

According to Hoffstedt, a big issue is also that unlicensed operators are sophisticated enough to mimic the branding of legal operators, so that even well-meaning consumers are gambling on illegal sites without knowing it.

“That’s one of the main problems in Sweden,” he said. “And it’s actually not easy to solve, because crooks can, for instance, just steal the sign of the Swedish Gambling Authority and place it on their homepage.”

And while the government has run limited public awareness campaigns, Hoffstedt believes more could be done.

“The Gambling Authority launched one or two such campaigns, but I do think we should do more – perhaps within the industry as well. I know the Danish trade association launched their own campaign. Maybe that’s something we should look at too.”

If passed, as is expected, the new law would nevertheless mark a major turning point in Swedish gambling enforcement. But its true effect remains to be seen.

Without reforms that make Sweden’s licensed market more attractive to consumers – alongside stronger enforcement – the most muscular legislation may still prove leaky, he stresses.

“The proof of the pudding is in the eating,” Hoffstedt said.

With a general election in Sweden looming next year, the political appetite for deeper reform may soon be tested.

Recent research published by the Gambling Commission has sparked a critical discussion around two pressing questions: Who is truly at risk of migrating to the black market? And what should be done about it?

The answers are both complex and troubling.

A key finding in the Gambling Commission’s report on illegal gambling challenges the narrative that only self-excluded individuals and underage users are susceptible to black market activity.

Research reveals that the demographic profiles of legal and illegal gambling consumers are nearly identical – primarily men, younger individuals aged 18–24, frequent gamblers and those scoring 8+ on the Problem Gambling Severity Index (PGSI).

A recurring theme in the Gambling Commission’s research is the lack of public understanding around regulation. Elizabeth Dunn, partner at legal firm Bird & Bird, says this is a core concern.

“One thing that stands out is the commission’s acknowledgement of the disconnect between consumers recognising the importance of licensed operators and their actual understanding of how to verify licensing status,” Dunn tells iGB. “This may be partly due to lack of consumer awareness, but also an indicator of the increase in sophistication of the black market in recent years.”

Alasdair Lamb, senior associate at legal firm CMS, highlights a standout finding in the report: “That engagement with illegal sites is usually supplementary rather than exclusive, with most respondents reporting that they prefer spending time and money on legal websites.”

An opportunity and a responsibility

Elizabeth Dunn adds that this presents both an opportunity and a responsibility for regulators and operators to engage in more consumer-facing education campaigns to close the gap – an observation which is in line with the Gambling Commission’s recommendations.

This point is echoed by the Betting and Gaming Council (BGC), which cites a recent Frontier Economics study estimating that 1.5 million Brits are now gambling with illegal sites – reportedly spending up to £4.3 billion annually.

“Illegal gambling websites appeal to a worrying range of customers,” a BGC spokesperson said. “More than one in five 18–24-year-olds who bet already use unsafe, unregulated sites. Many black market sites specifically target the most vulnerable, including those who have self-excluded from regulated betting firms.”

The BGC warns that without balanced regulation and stable taxation, more consumers – including mainstream ones – may be pushed into riskier territory, undermining public safety while siphoning money away from licensed operators and, ultimately, the Exchequer.

Challenges to the commission’s report

The results in the Gambling Commission’s report clash with interpretations presented at recent events, such as the Peers for Gambling Reform forum, where it was suggested that only self-excluded players and children were at risk of migrating to the black market.

According to Ismail Vali, CEO of Yield Sec, it is a case of misinterpretation on the Gambling Commission’s behalf – partly, he explained, because the commission’s survey does not include minors in its data.

His company uses military-grade data surveillance to track online black market behaviour in the UK. It has also produced a report on the subject, which was released in early September.

“It clearly shows that the people who are engaging with illegal gambling are people who have no other option. Of all the illegal gambling promotion in the UK, 84% of it is ‘not on GamStop’ search-driven. Yes, there is some mainstream marketplace movement towards illegal gambling in the UK, but generally, where the money is coming from is from children and self-excludes.”

He stresses that data brokers, social media algorithms and SEO manipulation are being used to directly target those who have self-excluded or shown signs of addiction.

Yield Sec’s findings claim that the black market in the UK has exploded – from 0.43% of the market in 2020 to nearly 9% in 2025 – driven by both targeted marketing tactics and regulatory pressure on legal gambling operators.

In its own report, Yield Sec finds that there are currently more than 500 illegal sports betting and casino operators actively targeting the UK, and more than 1,100 affiliates promoting illegal operators.

Exploitation of vulnerability

At the centre of the black market debate is GamStop, the UK’s national self-exclusion scheme.

GamStop – which since 2018 has had more than 600,000 users registered for self-exclusion from all UK-licensed sites – acknowledges that stopping illegal enterprise is a major challenge but maintains it is taking steps:

“We recognise that there is more work to do to remove all advertising of casinos bypassing GamStop and to prevent the advertising in the first place. We are in regular contact with the Gambling Commission’s intelligence and enforcement team, we welcome the Crime and Policing Bill, which will give the Gambling Commission greater powers to act swiftly to take down IP addresses and domain names associated with illegal websites.”

GamStop also points to an Ipsos evaluation of users of unlicensed operators:

“Just 8% of more than 4,600 users said they were using unlicensed or illegal gambling operators. While the activities of black-market operators are a concern, it is important we keep the issue in perspective,” said the spokesperson.

This response from GamStop does not sit well with the Yield Sec CEO, who sees it as a downplaying of a pressing issue.

“If you look at the trajectory in Great Britain, it’s frightening. Since we first talked about this in 2020, it has doubled every year. And now we’re at this horrible height,” said Vali.

He warns that the number of users on illegal platforms will likely continue to grow unless the problem is properly managed – especially in a time when illegal TV and film streaming sites (where illegal gambling sites tend to advertise) are becoming more popular. This is another factor expected to impact the mainstream marketplace.

Where does the responsibility lie?

Overall, said Vali, the responsibility for a safer online gaming environment in the UK lies with the Gambling Commission and GamStop.

“If you set up a scheme like GamStop and you tell vulnerable customers they are safe, surely you should make them safe,” he adds. “And they are not safe in Great Britain right now.

“Go after the supply chain, go after the advertising, go after the social media content. That’s what you can change right here, right now, today.”

Elizabeth Dunn from legal firm Bird & Bird emphasises the regulatory challenge for the industry.

“The primary challenge remains the commission’s limited ability to take effective action against offshore unlicensed operators,” she suggests. “The regulator has increasingly focused on the regulated B2B market to prevent game supply to unlicensed operators and I expect this approach to continue.”

The Nevada Gaming Control Board announced on Friday that the state reaped $1.22 billion in gross gaming revenue, a 5.5% increase over last August. After a slow FY25 snapped a streak of three straight fiscal year records, Nevada is about 5% ahead of last year’s pace.

Clark County, which includes Las Vegas and surrounding areas, was up 5% YoY as a whole. However, the performance of individual sectors is indicating that the Las Vegas Strip is reclaiming its dominance over the locals market, which enjoyed massive success over the last 18 months as a value proposition to the increasingly costly Strip experience.

On the Strip, America’s gaming capital was also in the 5% growth club, jumping to GGR of $679.3 million. Its year-to-date performance is coincidentally also up 5%. Conversely, the locals market fell 1% to $142.3 million, and is down 2% for the fiscal year, the worst of the state’s major markets. For much of 2024 and early 2025, those roles had been reversed.

Baccarat performance on the Strip has become the key driver for the region and, subsequently, the state. In August, the Strip won $114.4 million on the game, a 51% upswing YoY. That is more than any state sector generated as a whole, except for the Las Vegas locals market. It has become common to see massive month-to-month swings in baccarat; for the previous three months, the Strip is up 29% on the game, but for the previous 12 it is down 3%.

Visitation numbers continue to slide in 2025

While the increasing gaming revenue is a positive sign for the industry, the continued lag in Las Vegas tourism is what has captured national headlines for months.

According to the Las Vegas Convention and Visitors Authority, the city’s visitor volume was down 6.7% to 3.1 million in August. Every month in 2025 has seen a YoY visitor decrease of at least 1%, with most ranging from 5%-10% or more. The last increase of more than 1% came in September 2024.

Convention attendance, which had been the lone bright spot for the region this year, was also down 8% because of rotating show schedules. However, big upcoming shows like the Global Gaming Expo in October, the Consumer Electronics Show in January and the industrial Con/Agg show in March will boost future totals.

Harry Reid International Airport announced on Wednesday that domestic and international air traffic through Las Vegas declined 6% and 3.7% in August, respectively. The latter has been the biggest point of concern for stakeholders, especially as US President Donald Trump continues to ruffle feathers with aggressive tariff hikes and foreign policy.

Historically a top feeder market, Canada has been especially affected, seemingly in part from Trump’s “51st state” comments earlier this year. Traffic from WestJet and Air Canada plummeted 33% and 40% in August, respectively. Mexican airlines like Volaris and VivaAerobus performed better by comparison, but this was offset by huge struggles domestically from bankrupt budget carrier Spirit Airlines (down 46%).

Sin City’s glass half-full or half-empty?

The confluence of business and travel factors make it increasingly difficult to analyse Las Vegas.

On one hand, gaming revenue is up and businesses are doing well, while most operators posted solid Q2 results with optimistic future outlooks. The AGEM Index, an index of stocks from 10 leading gaming suppliers, was up 5% month-over-month in August and 32% YoY.

Additionally, numerous ongoing projects are expected to contribute to future success. The former Mirage will reopen as the Hard Rock Las Vegas in 2027 and add more than 3,500 rooms back to the Strip.

Work has begun for the Las Vegas A’s new Major League Baseball stadium on the Strip, with another resort primed for the same lot. The third annual Las Vegas Grand Prix, a catalyst international Formula 1 racing event, returns in November. Off the Strip, locals-focused operators are enjoying their best stretch of performance in several years.

On the flip side, the factors that fuelled the Las Vegas tourism slide do not appear to be fading. The Federal Reserve cut interest rates one time in 2025 and cautioned against future cuts. On Friday, the personal consumption expenditures price index reported a 2.7% YoY increase in August, the highest monthly increase since February.

Operationally, casinos are paying markedly higher labour costs as new Culinary Union contracts take effect this year. Overall, union wages have gone up 10% and will increase by 32% over the life of the contracts. Most are also now leasing their real estate from REITs and are subject to annually increasing rents.

LVCVA looks to reinvigorate Las Vegas tourism

While CEOs and local officials largely downplayed these concerns earlier this year, most now acknowledge at least some uncertainty for Las Vegas. However, MGM CEO Bill Hornbuckle said at a recent Bank of America conference that it is on the industry to change the narrative.

“To the idea that Las Vegas is dead, I would say this: We are putting a push on, because we let the narrative get away from us, in the context of value,” Hornbuckle said. “So we are out pushing that Las Vegas is a huge [value] and remains a huge value for consumers at all levels.”

The LVCVA launched a multimillion-dollar ad campaign to mixed reviews and is rolling out new deals. This week was the agency’s first-ever city-wide promotional discount, the “Fabulous 5-Day Sale”. Under the programme, operators and businesses from around the city pledged more than 100 deals.

In recent weeks, agency reps also travelled to Canada in the hope of coaxing would-be guests to come back to Sin City. LVCVA CEO Steve Hill said at the time that a lot of Canadians “are not happy with us right now” and that “we understand they may not be ready” to return. Overall, though, Hill is leading the optimism for the region.

“I’m betting on Vegas,” Hill said in August, per CDC Gaming. “Las Vegas is still the Entertainment Capital of the World. We’re all confident in the future of this city. We’ve met over the last couple of weeks with virtually every property and we’re excited about what we’re hearing. The city is taking steps to address (the downturn).”

Tapped by the White House to head the US Commodity Futures Trading Commission, Quintenz has seen his nomination stall amid urgings from the Winklevoss twins to delay the process. If Quintenz is passed over, the move could deliver a major blow to prediction market supporters given his association with Kalshi. Quintenz, a former CFTC commissioner, has largely indicated that sports event contracts fall under federal jurisdiction, rather than with individual states.

Ahead of next Monday’s anticipated roundtable on cryptocurrency and prediction market regulation, speculation has intensified that Quintenz will be replaced by the White House. Last week, Bloomberg reported that US President Donald Trump is mulling potential replacements for the position.

So who might be the next CFTC chair?

Could the new CFTC chair be a former director?

Josh Sterling, a partner at Washington DC-based firm Milbank LLP, is being vetted by Trump’s administration, Semafor reported this week. For prediction market detractors, Sterling would not be the preferred choice.

For one, Sterling has represented Kalshi in numerous cases over the past 18 months. At Jones Day, Sterling’s previous stop, he represented the prediction market in KalshiEx LLC vs CFTC. There, attorneys for Kalshi argued that so-called Congressional Control Contracts should not be prohibited by the derivatives regulator.

The trades gave customers the ability to predict which political party would gain control of the Senate and the House of Representatives in the 2024 election. Kalshi eventually won a stay in US District Court that allowed the site to offer contracts on the presidential election. Weeks later, Kalshi began listing the contracts on sports.

What Sterling said at gaming legislation conference

In July, Sterling made an appearance on behalf of Kalshi at the National Council of Legislators From Gaming States summer meeting in Louisville.

At the event, the former CFTC director mused that it is not up to the courts to decide whether market participants are using the contracts to engage in speculation or hedging.

Sterling also drew a comparison between sports contracts and derivatives on commodities such as WTI oil futures. As of 2025, no states have imposed regulations on wheat derivatives, he noted.

“How many contracts are event-dependent – oil, wheat, interest rates, or foreign exchange rates?” Sterling told iGB following the panel. “This is an industry-wide issue that has very little to do with events.”

A Sterling appointment as CFTC chair should largely be viewed as a favourable development for prediction markets. As an agency director, Sterling oversaw approximately 3,300 financial firms that registered with the CFTC to participate in the global derivatives market, according to his LinkedIn page.

During Sterling’s tenure (2019-21), he expanded the agency’s oversight, examination and enforcement referral programmes with those firms and completed more than 60 major rule and relief initiatives, the attorney wrote on LinkedIn.

Beyond Sterling, there are strong indications that the other candidates are under consideration for their experience in crypto matters.

Crypto-friendly lawyer under consideration

In comparison with Sterling, Mike Selig’s expertise on prediction market litigation and regulation is more limited. The SEC appointed Selig as chief counsel of its newly Crypto Task Force in March, one tasked with “creating workable solutions to difficult crypto regulatory problems”, according to then-SEC Commissioner Hester Pierce.

Before joining the SEC, Selig served as a partner at Willkie Farr & Gallagher, a leading international law firm.

Selig, who began his career as an intern at the CFTC, is a protege of former chair Chris Giancarlo, the author of 2021 book “CryptoDad”.

Notably, the Winklevoss twins made an appearance at a Manhattan event celebrating the book launch. Giancarlo, who lauded Selig for the appointment, provided an insider’s account of the rise of cryptocurrencies in the book.

While with Willkie Farr, Selig discussed leveraged trading activity as futures contracts in a 2022 memo. If no exception applies to such transactions, then retail commodity transactions must be traded on a designated contract market, the memo states. In CFTC parlance, a designated contract market is also known as a prediction market. Opponents of prediction markets likely would prefer the appointment of Selig over Sterling.

Another CFTC chair hopeful from crypto space

As with Selig, Tyler Williams’ bailiwick is crypto regulation, not prediction markets. In February, the Treasury Department appointed Williams as a counsellor to Secretary Scott Bessent on digital assets and blockchain technology policy. Prior to joining Treasury, Williams served as global head of policy at Galaxy Digital, a digital assets and data centre infrastructure business.

Williams’s views on prediction markets are largely unknown. In June, Williams spoke to FIA Market Voice, a futures’ industry podcast.

The conversation centred on stablecoins, digital assets and future use cases of blockchain technology. Prediction markets were not covered.

Also this summer, Williams sat down with TRM, a blockchain intelligence company, for an extensive chat on crypto policy. The discussion focused on a landmark White House report on digital assets released weeks earlier.

The 166-page report referenced DCMs 10 separate times, but it did not mention sports event contracts.

Other trading regulator chair candidates

Earlier this week, an attorney from crypto law firm Brogan Law wrote in a blog that SEC Chairman Paul Atkins has emerged as a potential candidate. The author, Veronica Irwin, wrote that multiple sources told her that Atkins is “first in line” for the position.

Such an appointment would be unlikely under the auspices of the Securities Exchange Act. According to the 1934 law, the SEC wrote that “no commissioner shall engage in any other business, vocation or employment than that of serving as commissioner”.

Caroline Pham, the interim chair of the CFTC, already announced that she intends to leave the commission when a successor is appointed. Former US President Joe Biden nominated Pham to the commission in 2021.

Across European markets, governments are imposing or proposing steep gambling tax hikes on operators, many of which last year contributed €3.8 billion in taxes to the European economy as a whole, according to the European Gaming & Betting Association (EGBA).

In most cases, policymakers have said they are turning to the sector to help plug budgetary holes. And gambling is a seemingly easy target for governments that can play into the public health argument against the industry.  

“Gambling has traditionally been viewed as a good source of relatively painless government revenue. Tax policies in European countries are also increasingly focusing on excise taxation, particularly environmental and public health excise duties, to raise much-needed public revenue,” explains Virve Marionneau, associate professor and tax expert, as well as director of the Centre for Research on Addictions, Control and Governance at Helsinki University. 

However, the returns from these gambling tax policies are uncertain and are likely to negatively affect the broader sector. So, what lies behind the political decision-making? 

Netherlands gambling tax hike impact already being felt

Let’s first take a look at what’s going on in the Netherlands. Lawmakers there approved a sharp increase in gambling tax, from 30.5% to 34.2% of GGR, starting in January 2025, with a further rise to 37.8% in 2026.

The Dutch Treasury had expected an additional €200 million in tax revenue annually, but figures from the licensed Dutch online gambling providers, represented by VNLOK, suggest that GGR in the first half of 2025 will be down 25% compared to the previous year, resulting in a shortfall of €200 million. 

Both VNLOK and the Dutch regulator KSA have expressed concern about the government’s plan for a further tax increase. 

When taxes increase on gambling operators, they often pass additional costs on to their customers. This could manifest in higher betting odds, higher fees or less attractive bonuses and promotions. As a result, players may turn to the more lucrative but also riskier unlicensed market. 

“The tax hike will have a negative impact on our market. Channelisation rates will decrease. We are worried about that, because we believe a strong legal market is key in combating illegal offerings,” Marloes Derks, spokesperson for KSA, tells iGB. 

Despite this, the Dutch government has stated that its tax policy will not change, even though expected revenue is falling short of expectations.

In accordance with budgetary rules, windfalls and shortfalls in tax revenue are reflected in the balance after policy is adopted. Therefore, the revenue shortfall, from this perspective, is not seen as grounds for a compensatory policy, according to State Secretary for Taxation Eugène Heijnen, who addressed the Dutch parliament earlier this month. 

A strategy doomed to fail 

The Dutch tax hike has drawn attention from other markets. 

“As I understand it, the message from Dutch politics is that they consider the concept of channelisation to be irrelevant. They simply ignore it in favour of various moral views on gambling. And then, of course, it becomes easy to raise taxes,” says Gustaf Hoffstedt, secretary general of BOS, the Swedish Trade Association for Online Gambling. 

He observes a trend across Europe of tightening conditions for licensed gambling companies, with tax increases being just one example. 

“An important component of that trend is the lack of interest in how such deteriorations affect the ability of licensed gambling companies to keep out unlicensed competitors,” Hoffstedt says. 

In his home country of Sweden, the Ministry of Finance was expected to raise €50 million a year through an increase in tax from 18% to 22% on GGR, effective from July 2024. But Hoffstedt – who calls the political reasoning behind the tax hike “profit hunger” – believes those figures are more likely to be around €20 million-$40 million. And it will come at a cost, he adds. 

“Reduced channelisation and around a thousand new gambling addicts as a result of the transition from licensed to unlicensed gambling,” he predicts. 

Trend across Europe 

Looking toward Eastern Europe and Tier 2 markets, Romania has imposed a 27% GGR tax on online operators from July 2025, up from 21%, and is also introducing higher licensing fees.

In the Czech Republic, the government increased the GGR tax for online betting, bingo and poker from 23% to 30% in 2024 to fund public spending. 

In Slovakia, where activity in the online casino market rose by almost 30% year-on-year in 2024, Environment Minister Tomáš Taraba has called the gambling industry “profiteers of human misery”. The government has proposed raising the tax rate for online gambling to 30%. 

Meanwhile, in Germany, every euro wagered on slot machines and poker faces a 5.3% levy. Because of this rule, up to 80% of online slot play now takes place with unlicensed operators, estimates the German Online Casino Association. German online casino tax revenue saw a decline of 16% in 2024 and, since 2022, there has been a 47% drop. 

France is already one of Europe’s most expensive markets to operate in, but the government is planning to expand GGR taxation and charges. It aims to generate an additional €1.6 billion in gambling-related revenue. 

“A few European jurisdictions like Malta and Estonia stand out with exceptionally low tax rates to attract onshore gambling operators. Other countries, like France, use high tax rates as a means to control entry to the market. The aim of French gambling policy has been to keep the number of licensees low,” says Marionneau, tax expert from Helsinki University. 

UK gambling tax decision will affect the whole sector 

And then there is the UK – Europe’s biggest market for online gambling – and for a long time, known in the industry as the voice of reason in Europe when it comes to a balanced approach to gambling regulation. However, for the industry, that perception may be about to change.

In April, the UK government proposed bringing the current three-level tax rate system for remote gambling under one consolidated rate. 

The industry has expressed concerns over the changes, believing it could result in all gambling verticals facing a 21% duty.

Several voices are pushing for a much bigger tax increase on the gambling sector. Among them, former Prime Minister Gordon Brown and the Institute for Public Policy Research (IPPR). They argue that a tax increase on the sector should be used to help fight the rising child poverty in the UK.

IPPR has recommended increasing remote gaming duty from 21% to 50%, and machine games duty from 20% to 50% of operator profit. General betting duty would rise from 15% to 25%, estimating that this could generate around €1.5 billion. 

The UK government is expected to present its plans in the 2025 autumn budget on 26 November.

UK government sending mixed signals

The UK’s Betting and Gaming Council has called the proposal “reckless” because it will drive players toward the unlicensed market, a claim that IPPR has chosen to dismiss. 

“There appear to be three drivers here: the economy, policy and politics. HM Treasury keeps all taxes under review and we know that it has been looking at online gambling for a while. It may take the view that the online gambling market can sustain higher levels, which will be unresented by the population at large,” says Dan Waugh, partner at Regulus Partners. 

The government is sending mixed signals regarding its attitude toward the gambling industry, and this has raised alarm bells, he says. 

“The Department for Digital, Culture, Media and Sport (DCMS) adheres to the traditional view that gambling is a legitimate pastime that can involve negative health consequences. It therefore favours a balance of freedom and protection. The Department of Health and Social Care, on the other hand, perceives gambling as the ‘new tobacco’ and wishes to do various unspeakable things to it enroute to prohibition.  

“Prudent operators will be looking at how they can mitigate the costs of any tax increases.” 

Whatever happens in the UK will affect the entire market in Europe, says Hoffstedt. 

“The UK, together with Denmark, has been able to show that it is possible to combine high channelisation with high consumer protection. If channelisation in the UK declines in the future, it will negatively affect all gambling markets in Europe.” 

Hoffstedt hopes that governments will eventually recognise the negative consequences. 

“In the end, it becomes obvious to everyone that a gambling market that lacks consumers – when they’ve gone to the unlicensed gambling market – lacks relevance and legitimacy. It is a strategy that is doomed to fail in every jurisdiction that uses it.” 

ESPN reported recently that the two sides finalised the settlement in early 2025. The network also reported last year that the Jaguars made a request to FanDuel to repay a portion of the embezzled funds. Securities filings indicate that the settlement may be easier for FanDuel to swallow in comparison with initial projections.

Earlier this year, FanDuel finalised the agreement with the Jaguars to compensate the NFL club for approximately $20 million in stolen funds that the employee deposited at the sportsbook. But in a series of legal matters where requested damages by the employee stretch to $250 million, this Jaguars settlement looks relatively smaller, especially compared to the company balance sheet.

During the second quarter, Flutter produced revenue of $4.19 billion for the three months period ended 30 June. In the US, Flutter generated revenue of $1.79 billion, with sportsbook revenue of $1.22 billion.

A FanDuel spokesman did not respond to a request for comment.

Jaguars legal costs not broached in Flutter filing

Amit Patel, a former Jaguars executive, pleaded guilty in 2023 to misappropriating $22 million from the team’s Virtual Credit Card (VCC) programme in a brazen bid to fuel his gambling habit. Patel, who served as the sole custodian of the team’s VCC system, received a 78-month prison sentence last year on several charges, including wire fraud.

The exact timing of the settlement is unclear, but it appears to have been reached around March when FanDuel parent Flutter released a Form 10-K filing with the US Securities and Exchange Commission.

The filing, which covers Flutter’s annual report for the 2024 fiscal year, contained a series of potential damages regarding pending litigation against the company.

While Flutter informed the SEC of litigation on several continents, the section on legal contingencies did not contain any matters in North America. The section included:

• Alleged German and Austrian player claims for the reimbursement of historic gaming losses.
• A tax dispute with Italian authorities over Pokerstars server infrastructure.
• An investigation into historical underpayment of a goods and services tax in India.

Of the three, the lowest contingency is the Italian tax settlement for €8 million ($9 million), Flutter disclosed. Flutter strongly disputes the European matter and wrote that it was unable to determine a reasonable estimate on a range of potential losses in the India case.

How FanDuel settlement could cut off potential harm

Thus far in 2025, Flutter has released quarterly filings in May and August for the first six months of the year. Flutter did not alert the SEC of the Jaguars settlement in either filing.

But that does not necessarily mean FanDuel is downplaying the gravity of the case.

In a parallel matter, Patel filed a $250 million federal lawsuit against FanDuel, alleging that the company took advantage of his gambling addiction. Diagnosed with a gambling disorder a month after his termination by the Jaguars, Patel claimed that FanDuel should have known that he was a compulsive gambler since he made more than 1,000 deposits of at least $20,000.

In the annual report, Flutter stated that the company will likely face “increased scrutiny” related to responsible gaming in the relative near future. While Flutter asserted that it implemented safer gambling measures designed to protect customers, if the perception develops that the company fails to adequately protect vulnerable players, it may suffer from reputational harm.

Since her appointment as CEO of FanDuel in 2021, Amy Howe has asserted that the company strives to “lead the industry” in responsible gambling.

In one month alone, Patel made $5.6 million in fraudulent transactions, an amount that exceeded the cap of the VCC programme, court records indicate. Patel indicated in an interview with law enforcement that he artificially inflated legitimate expenses and generated fictitious charges under the scheme.

The NFL encouraged the Jaguars and FanDuel to reach a settlement, but it did not participate in the negotiations, according to ESPN. Last July, the Jaguars filed a lawsuit against FanDuel in Florida state court seeking damages of $66.6 million.

Dynasty leader Thaksin Shinawatra, jailed for twelve months on 9 September, tried to introduce casinos during his 2001-2006 tenure as prime minister. That tenure ended with a military coup. In August 2023, after his return from 15 years of self-imposed exile, Thaksin became a principal cheerleader for the IR drive under the new prime minister – his daughter Paetongtarn Shinawatra. 

Paetongtarn was suspended as prime minister in July and removed by the Constitutional Court in late August over a fawning phone call with former Cambodian leader Hun Sen amid military conflict between the two nations. Meanwhile, Thaksin’s sister Yingluck Shinawatra, prime minister from 2011-2014, remains in exile. 

Fresh beginning … in a coma 

“This is a fresh beginning for Thailand,” Bangkok-based hospitality advisor James Kaplan says. “It will be looking at integrated resorts with a fresh perspective, hopefully a balanced and more constructive perspective.” 

New Prime Minister Anutin Charnvirakul has declared his opposition to casinos. The leader of the Bhumjaithai Party, Anutin promises parliamentary elections by early next year, although they are not legally required until June 2027. 

“Gaming legislation is not dead, but it’s in a coma. It could reawaken after the election,” says Kaplan, a board advisor to Bangkok Land, which owns Impact Convention and Exhibition Center, a potential IR site. 

“Some observers suggest the [casino legalisation] agenda might reemerge under revised regulations to protect existing arrangements or create new bargaining space, although it is equally possible that shifting political priorities will push it aside,” Maverick Consulting Group partner Ben Kiatkwankul says. “Either way, the debate around [integrated resorts] is likely to remain a tool of political and economic manoeuvring in the months ahead.” 

Too hard to rock 

The political maelstrom has cost Thailand at least one top tier global casino operator. In an exclusive interview, Hard Rock International Chairman James Allen told iGB his company has “zero interest” in a Thailand IR at this point due to “instability”. (More from that interview will be provided in upcoming coverage.) Hard Rock had considered options in Thailand including a convention-based IR in Phuket. 

With falling tourism numbers, a rising currency and mounting debt, the case for entertainment complexes – Thailand’s chosen term for integrated resorts – has never been more compelling. The challenge amid political polarisation and distrust is to rebuild the consensus that produced near unanimous parliamentary support for casino legalisation in March last year. 

In some ways, that proposal became victim of its own success. Citing the Thai proverb “ten fires don’t compare to the harm of a single act of gambling”, Kiatkwankul says, “The near unanimous parliamentary approval in March – we saw some of conservative parties raising hands for the bill – only fuelled speculation about behind the scenes political manoeuvring.” 

Family affair 

When Paetongtarn Shinawatra replaced Srettha Thavisin as prime minister in August last year, she elevated IRs to a cornerstone policy of her Pheu Thai Party government, even though it had not featured prominently in its election platform. IRs came to be viewed as a Shinawatra family initiative. 

“I have found that no matter how the media spun it, 50% of the politicians and 50% of the populace supported the Shinawatras. It’s a shame because this means that the remaining 50% did not,” Checkmate Mitigation senior advisor David Leppo says. “How can there be any political congruency with a landscape like that?” 

Public distrust deepened with Paetongtarn’s political troubles and Bhumjaithai’s subsequent withdrawal from the ruling coalition. “Their immediate distancing from the bill only reinforced perceptions of political instability and potential hidden agendas,” Kiatkwankul says. 

The new government without Shinawatras up front resets the IR issue. “Thaksin is fatally damaged as is his party, and he was the main [IR] promoter,” longtime Bangkok corporate communications consultant Julian Spindler says. “There’s little the foreign players can do to change this political situation, but they should use this downtime to educate the Thai public as to the required regulatory environment à la Singapore.” 

Pokies in every pot 

“They’re hearing this idea that Thailand is going to have a pokie machine in every lavatory and every 7-11, à la some other countries – my own Australia being an example,” Silq Law founding partner Paul Crosio says. 

Leppo, a longtime sports book operator in North America and Asia, sampled public attitudes at anti-casino demonstrations in Bangkok. “About 70%-75% of the people I spoke to felt that the industry would attract an undesirable demographic, laying the foundation for organised crime to thrive, when in fact, in jurisdictions like Singapore, casinos have had the exact opposite effect. 

“These same people also had the misguided opinion that casinos would lead to problem gambling, when in fact, just like Singapore has proven and delivered, programmes like Gamblers Anonymous are funded by Singapore’s casinos, which could be mirrored here in Thailand.” 

Striking a balance 

“Problem gaming is not a solely Thai phenomenon,” Kaplan says. “Governments such as Singapore recognise the need to strike a balance between tourism relevance, job creation and tax revenue while mitigating the challenge of problem gaming. Just because Thailand delays implementation of the gaming bill doesn’t mean people won’t gamble. They still will, and they’re taking the money outside country.” 

A recent study estimates Thailand’s underground gaming economy at more than US$30 billion annually, including domestic underground casinos, border casinos in Cambodia, Laos and Myanmar plus online gambling. 

How much of that money legalised Thai gaming would capture depends on the regulatory scheme. Under the Pheu Thai government, cabinet ministers proposed an entry requirement for Thai nationals of 50 million Thai baht (US$1.6 million) in bank deposits alongside a THB5,000 entry tax. The mooted THB50 million entry requirement highlights conflicts in Thailand’s casino legalisation objectives and an under-informed approach to gaming regulation.   

Only a handful of Thailand’s 70 million citizens would qualify for casino entry under the THB50 million rule. That scenario would satisfy underground gaming interests currently catering to Thai gamblers, while placating groups that don’t want more Thais (openly) gambling. However, making Thailand a virtual foreigner-only casino market would limit international operator interest and IR investment, paradoxically making any IRs less tempting for tourists, decreasing potential tax revenue and employment. 

Regulatory irregularity 

The draft regulatory scheme placing the prime minister and cabinet members at top of the pyramid ignores international best practices and lacks social safeguards. Thai officials reportedly did not consult with other jurisdictions or international experts when drafting gaming regulations. 

“The regulations need to be sound and transparent. They need controlled and trusted supervision of a gaming board,” Global Chain Ltd managing partner Harmen Brenninkmeijer says. “There are enough examples around the world of what makes IRs work. Investors know the potential, but the regulatory and judicial climate need to support their investments, and they need to feel protected. If not via the judiciary, the gaming board can take that role solely.” 

“They need to establish a regulatory committee of gaming professionals and gaming legal scholars to outline and deliver a legal mantra that will ensure groups like Sands, Wynn, Genting, MGM, Galaxy, et al feel comfortable investing here in Thailand,” Leppo says. 

Simultaneously, Thailand needs to placate current stakeholders in its underground and cross-border gaming sector, as well as ease public concerns over problem gambling and other social impacts. 

Lonely in the middle 

This challenging agenda amid political turmoil has convinced many that Thailand will abandon casino legalisation. However, the conditions that led the kingdom to consider and, at least briefly, embrace IRs have become more acute. 

On the tourism front, Thailand now sees itself occupying uncomfortable middle ground between cheaper alternatives such as Cambodia and Indonesia – particularly as the baht rises to post-Covid highs – and upmarket destinations like Singapore, South Korea and Japan. 

As of 7 September, foreign visitor arrivals had fallen 7.1% from a year earlier to 22.3 million, 25% below 2019 figures. Visitor expenditure has fallen more sharply with the drop in high-spending Chinese tourists; Chinese arrivals this year are nearly 1.5 million below last year’s level. 

Thai tourism ‘sliding downhill’ 

“The Thai tourism industry is going in reverse, sliding downhill with increasing speed, which should worry policymakers, especially as this industry makes up roughly 18% of direct GDP,” Kaplan says. “The knock-on effect to the broader already weak economy is a serious concern. The situation is expected to become worse during the high season due to the irrationally strong baht, regional instability with Thailand’s neighbours and call centre scams putting people off visiting the country.” 

Thailand’s economy is projected to grow 2% this year. That is half the rate of fellow ASEAN members Philippines and Indonesia. Ahead of Anutin forming his government, Thailand’s main stock market index was Asia’s worst performer this year, down 10% versus a 17% rise in the regional benchmark. 

Gaming taxes would provide the Thai treasury with much-needed revenue amid ambitious economic stimulus plans following Covid relief spending. Thailand’s tax revenue is estimated at 15% of GDP, three percentage points below the ASEAN average. 

Human face of debt 

Thailand’s public debt, 67.9% of GDP, has drawn a warning from the International Monetary Fund.  The spending plan approved by parliament early this month projects a THB860 billion budget deficit, 4.3% of GDP. 

“Integrated resorts are part of a broader solution needed to stimulate the Thai economy with significant direct foreign investment, employment and tax revenue,” Kaplan says. “If you look at the big picture, household debt and public debt are totally out of control. Car loan defaults are at new records, shops are vacant and businesses are closing down at increasing levels. It’s bad. You can see it on people’s faces. 

“I am not saying legalised and regulated gaming is the solution to this economic malaise, but instead IRs should be viewed as part of the solution in the context of rejuvenating, stimulating and, most importantly, sustaining the critical tourism industry in a competitive world.” 

Polishing the gem 

An IR “is something that Phuket needs to stay the gem in the crown of Thai tourism,” says Crosio, who splits time between Bangkok and Phuket. “The client base in Phuket is much more upscale than it would be in other locations. So it’s ideal here.” 

Crucially, leading Thai business groups remain enthusiastic about investing in IRs. “I firmly believe that Thailand can be compared with Mexico and what I believe will be eventually Brazil: the casinos and ownership – surely the majority – is to be in the hands of locals to keep the money within the country,” says Brenninkmeijer, a senior advisor on SkyH’s IR proposal near Bangkok’s gateway Suvarnabhumi Airport. 

He describes SkyH as “an entertainment complex designed to attract local investment, with every aspect of its design and planning tailored to meet Thai expectations. The complex will feature a central, unified theme that blends luxury with a wide array of entertainment options. It is poised to become a major attraction for tourists, driving increased visitor numbers.” 

Electoral elephant 

Whether IRs get beyond the drawing board soon awaits the outcome of the next election. Casino legalisation will likely be the elephant in the ballot box, with no party making IRs a major plank in its platform. 

In 2023 lower house elections, the progressive Move Forward Party won the most seats but was thwarted by conservative forces in its attempt to form a government. Move Forward was subsequently ordered to disband and its leader barred from politics, leading to public outcry and reduced faith in the political process. The upcoming election, with Move Forward reconstituted as the People’s Party, could yield similar results with comparable controversy. 

It’s worth noting that despite the discord surrounding the 2023 vote, lawmakers across party lines did join hands to embrace IRs, at least momentarily. The same thing could happen again. After all, every major Thai political party was for integrated resorts before it was against them. 

Full disclosure: Author Muhammad Cohen has signed client referral agreements with Maverick Consulting Group and Checkmate Mitigation.

Muhammad Cohen is a former US diplomat and current iGB Asia editor at large. He has covered the casino business in Asia since 2006, most recently for Forbes, and wrote Hong Kong On Air, a novel set during the 1997 handover about TV news, love, betrayal, high finance and cheap lingerie.

Patrick, who presides over the Texas Senate, has repeatedly blocked sports betting and casino bills in recent sessions. He has said measures need majority Republican support in the Senate before he will allow them to be heard.

While the gambling industry has considered Patrick to be the major foil to gambling issues, he has offered little public commentary on his personal or political stance toward gambling. But the Dallas Morning News recently reported it may be a mistake to view Patrick as the sole obstacle.

“If I was the Sands Corporation, I’d be trying to count my Senate votes and quit worrying about Dan Patrick,” Austin-based consultant Mike Lavigne told the newspaper. “Patrick is not as big a problem as the rest of the Senate is. And if they had the votes in the Senate, Patrick wouldn’t be a problem.”

As an incumbent, Patrick is unlikely to face opposition in the Republican primary next March, according to local media.

Previous Texas sports betting efforts

The Texas legislature meets every other year. This year, sports betting and casino gambling bills were effectively dead on arrival, as Patrick said they would not be considered in the Senate. There was also a group of a dozen House lawmakers who said they would oppose “any attempt to expand gambling” earlier this year.

Before Patrick and the bloc of House lawmakers announced their opposition, industry proponents were fairly bullish on legalisation hopes in 2025.

That followed an effort in 2023 that saw sports betting make its way through the House with a two-thirds majority. Gambling expansion requires a constitutional amendment, meaning it needs approval by a two-thirds majority in both chambers and a majority of Texas voters at the polls.

Following the House passage in 2023, Patrick doused hopes of sports betting legalisation via a comment on Twitter and the Senate did not hear the bill.

“Texas is a red state,” Patrick said in the post. “Yet the House vote on sports betting was carried by a Dem majority. The Texas Senate doesn’t pass bills with GOP in the minority. The GOP majority guides our path.” 

Texas coalition continues push

Texas Governor Greg Abbott has said he has no objection to gambling expansion and a University of Houston poll reported that 60% of Texans support online sports betting. If it approved legalisation, Texas could become the largest legal sports betting market in the US.

The Texas Sports Betting Alliance is an organisation that represents major sportsbook companies and the state’s professional sports teams. Team owners, like the Dallas Cowboys’ Jerry Jones, have sought to sway Patrick’s opinion.

Heading into this year’s legislative session, gambling interests poured millions into Texas. Las Vegas Sands owner Miriam Adelson donated nearly $14 million to legislators during 2024. Adelson purchased a majority stake in the Dallas Mavericks last year.

Despite some of those contributions going to Patrick, he continued to repeat there was not enough support for the issue and the Texas GOP platform opposes gambling expansion.

Patrick told WFAA in November 2024 that gambling backers “spent millions and millions of dollars and just think that magically it happens. It doesn’t.”

Accustomed to withstanding wild swings at the blackjack table, Bowyer opened Labor Day weekend by learning his fate inside a Southern California courtroom Friday. One of the nation’s largest bookmakers received a sentence of approximately one year in federal prison. Since then, Bowyer has endured a spectrum of emotions surrounding preparations to report to prison.

Bowyer is the bookmaker who accepted approximately $325 million in wagers from Ippei Mizuhara, the former interpreter for Shohei Ohtani who is serving his own prison sentence for embezzling from the baseball star.

Bowyer spoke to iGB on Labor Day in one of his first interviews following his sentencing. He gave the interview knowing he must report to federal prison by 10 October for pleading guilty last summer to three criminal charges, including transactional money laundering.

“It’s been absolute chaos for the last 48 hours,” Bowyer said from his villa in San Juan Capistrano. “But I also have this huge sense of relief knowing what the end is. Listen, let’s be real. I’m human, I have a heart and I have feelings.

“I’m really trying to pull it all together for my kids and for my wife. There’s moments when I’m crumbling inside, but I’m not going to show that emotion.”

Bowyer’s commitment to his family

A father of five, Bowyer is not your typical bookmaker. In a market dominated by surfer bros and middle-aged bachelors, Bowyer has been described by friends as a consummate family man. At last week’s hearing, Bowyer’s attorney, Diane Bass, depicted him as one of the most extraordinary clients she has ever represented.

While running a sophisticated multi-million-dollar gambling operation, Bowyer found the time to attend all of his children’s sports events, Bass stressed. Ahead of sentencing, the professional gambler spent about an hour last Thursday night consoling his tearful daughter, a memory Bowyer expects to take to his grave.

Bass petitioned the court to send him to FCI Lompoc, a Southern California facility located outside of Santa Barbara. Guest protocols at the facility limit Bowyer’s wife Nicole to only three in-person visits per month, he told iGB.

A self-professed sports junkie, Bowyer may be granted the option to buy a TV set in jail. But sports have taken a backseat for Bowyer for now. He didn’t learn of No 1 Texas’ loss to Ohio State in college football’s biggest game on Saturday until the following day. That lack of awareness would have been unfathomable when Bowyer ran his sportsbook.

While a US probation officer recommended Bowyer receive a sentence of 36 months, the government petitioned the court for an eight-level downward departure. US District Judge John W Holcomb sentenced him to 12 months and one day in prison.

In his sentencing decision, Holcomb weighed a bevy of mitigating factors including Bowyer’s assistance to the government, his status as a first-time offender and his outreach efforts on the perils of compulsive gambling.

“I always tell people if I didn’t have children and a wife, it would be a hundred times easier,” Bowyer told iGB.

“I’ve always been a person that tries to protect my family and bring all the discomfort to myself,” he said, adding that it “hit him hard” upon the realisation that he will go to prison.

Attempts by Bowyer to ‘recalibrate’

Prior to the hearing, Bowyer released “Recalibrate”, a detailed memoir that delves into his three-decade career as a bookmaker and whale bettor. This week, “Recalibrate” occupied the top spot in Amazon’s gambling addiction and recovery section.

Among the legion of Bowyer’s friends at his sentencing was Justin Paperny, co-founder of White Collar Advice, a firm that provides services to defendants with government investigations, sentencing and life after prison.

In a post on his firm’s website, Paperny holds a copy of the book as he poses for a picture with Bowyer on a golf course. Even if Bowyer had received a lengthy sentence, he has still made significant headway in his road to recovery, Paperny said in the post.

“Matt would still walk into prison with a published book in his name,” he wrote. “He would still have a social media presence, which he built from nothing. He would still have shown his daughters and young son that when life collapsed, their father chose to build.”

Over the last few months, Bowyer has gone on a media blitz conducting interviews with ESPN, Rolling Stone and VSiN, among others. Wife Nicole has also spoken with the media, granting a lengthy interview to Mark Laita of the podcast Soft White Underbelly. Addressing a 2023 FBI raid at the Bowyer mansion, Nicole told Laita that it was oddly a “blessing”, despite the trauma of the incident.

Nicole said she had become frustrated by her husband’s gambling habits in the final months before the raid. Over a 14-month period through October 2023, Bowyer gambled at Resorts World Las Vegas at least 80 times, a period when he lost about $6.6 million at the casino.

“When he was forced to not gamble anymore, it strengthened us,” his wife said on the podcast. “I’ve never met anyone in my life who can sell ice to an Eskimo. He has that and he can turn his talents into something amazing.”

Bowyer aims to eventually become a motivational speaker for athletes who are suffering from gambling addiction.

“I have anxiety about going to prison, I have anxiety about the next year of my life,” he explained. “But at the same time, at least when I wake up, I look in the mirror and I feel really good about what I see.”

Total visitation to Las Vegas has seen year-over-year declines every month this year, and Wynn, MGM and Resorts World have faced multimillion-dollar AML fines in 2025. As such, modernising salon rules could be a way to counteract both.

In gaming parlance, “salons” are private gaming rooms separate from public casino areas, including high-limit areas. Prior to 2001, Nevada law forbade any private gaming, but amendments were passed that year for the creation of salon regulations.

This was done, as Nevada Gaming Control Board Chair Mike Dreitzer explained Wednesday, to attract high-value customers to the state at a time of economic uncertainty post-9/11. The original rules surrounding salons were quite stringent, including a $500,000 deposit or credit minimum for prospective players.

This barrier was so high that only the biggest Las Vegas Strip casinos could field them. That is still largely the case; to this day, there are no salons at all in northern Nevada. Legally, they may only operate in “resort hotels”, defined in Nevada as those with gaming, 200-plus rooms and at least one bar and restaurant. Operators must apply and be approved for a salon licence.

In 2008, the economic uncertainty of the Great Recession motivated regulators to lower the threshold to $300,000. Then in late 2024, the NGCB embarked on another round of consultations regarding salons, again in response to economic uncertainty and the desire to keep Nevada relevant amid casino expansion elsewhere. A workshop was held last December to begin the process of amending salon regulations for a third time.

Several changes for salons recommended for approval

Feedback from that hearing was incorporated into a draft amendment to salon Regulation 5.200, which was presented by the board Wednesday. After two hours of further debate with stakeholders, the board unanimously recommended a number of changes, some of which include:

• Lowering the baseline deposit/credit threshold to $20,000.
• Allowing operators to apply for the right to set their own minimums based on proven salon experience.
• Establishing poker as a game eligible for salon play.
• Establishing a $20,000 buy-in minimum to commence a poker game, including a $10,000 minimum buy-in per player.
• Lengthening the period that a salon patron’s guest may play in a salon without the guest present from six to 24 hours.

The Nevada Gaming Commission will consider the amendments for adoption on 25 September.

Potential answer to Las Vegas tourism drop, AML issues

If Nevada casinos are freer to offer private gaming, that could attract more customers who previously went elsewhere for such experiences, stakeholders argue. Additionally, security in salons is higher than the main floor, and the gameplay would be more scrutinised.

Casinos have advocated for discretionary minimums to account for a larger number of business opportunities. For example, picture a celebrity passing through Las Vegas: they want to play a little, but don’t want to be bothered on the main floor or undergo the strict salon financial checks currently in place. Perhaps the CEO of a convention wishes to entertain some guests who are not high-rollers, but the casino wishes to thank them for the business they bring and offer them a private salon.

Loosening the regulations would allow more of those types of situations to be facilitated. In theory, this could lead to more revenue and return trips from high-value customers to combat the Las Vegas tourism drop.

Balancing collaboration and enforcement in Nevada casinos

The board, though, must balance those opportunities with realistic enforcement abilities. Opening the floodgates and setting no statutory minimum could create more problems for the state’s pool of regulatory resources.

Dreitzer acknowledged that operators’ eagerness is “well taken”, but constantly stressed the need for balance. He was deferential to the board’s enforcement chief, Kristi Torgerson, who advocated for a minimum of least $10,000.

“You must respect the fact that there’s a bit of an unknown here,” Dreitzer said to those in attendance. “And I understand we have checks along the way, but you know how that goes. There’s always sort of a push towards the lowest number at every level.”

Casinos eager for new offerings to battle Vegas spending lag

For the industry, there is heightened pressure to sustain what has been a record-setting stretch of performance post-Covid. The state set three consecutive records for fiscal year gaming revenue coming out of 2020, but was slightly (-0.79%) off that mark in FY25. The Strip, however, was -3%, the worst of the state’s major markets.

Las Vegas has increasingly invested in non-gaming entertainment, especially sports. In the last 10 years, the city added the Aces (WNBA), Raiders (NFL) and Golden Knights (NHL) franchises, and it will welcome the Athletics (MLB) in 2028. The annual Formula One Las Vegas Grand Prix is also contracted through 2027.

Virginia Valentine, president and CEO of the Nevada Resort Association (NRA), told the board this “evolution from the gaming capital of the world to the sports and entertainment capital of the world has changed the definition” of what a high-value customer is. To assuage concerns over a “proliferation” of salons and potential problems, she noted any new salons or modifications must be approved by the board anyway.

“Nevada is the regulatory gold standard. We would also like to be the gold standard of gaming experiences,” Valentine said.

Also making appearances Wednesday in support of loosening salon regulations were:

• Charlie Stone, EVP of casino operations and marketing for Wynn Las Vegas
• Chandler Pohl, VP and legal counsel for MGM Resorts
• Joe Lupo, president of Hard Rock Las Vegas, currently under construction

As mentioned, Wynn and MGM were among the three AML fines administered this year. Hard Rock also fired a top executive, Alex Pariente, this month over an AML scandal at the company’s casino in the Dominican Republic.

Poker in salons could fight Las Vegas tourism drop

The inclusion of poker as a salon game was notable, and something the NRA lobbied heavily for.

“We are aware that there are card games going on in other states, and possibly even here,” Valentine said Wednesday. “Those card games are happening out of sight, if you will. We are asking to kind of level the playing field because that’s what we’re competing with.”

While it was allowed, it was given somewhat stricter guidelines. For a salon poker game to commence, all players must submit to financial checks instead of just the main patron. Additionally, the board kept the $10,000 buy-in minimum per player, whereas the NRA had asked that one player be allowed to bankroll the entire $20,000 table minimum.

In a statement to iGB, Valentine applauded the board, both current and past, for “reviewing the matter and listening to the industry” to create new guidelines that “meet today’s environment”.

“The proposed regulations going forward to the Gaming Commission reflect a balance of needs for the industry and for regulators. That’s key to creating any effective public policy,” Valentine said. “We look forward to the discussion with the Gaming Commission.”

To Valentine’s point, it is no secret that Nevada casinos compete with a sizable legal and illegal poker market, especially in neighbouring California. The state offers legal poker at both tribal casinos and licensed card rooms. Its concentration of wealth and celebrities also makes it a hub for high-stakes underground games.

In one example, former NBA star Gilbert Arenas was among six charged in an illegal poker ring bust in July. The operation allegedly ran out of an Encino mansion owned by Arenas, with influence from Israeli organised crime.

Chip policies already changed this summer

Poker seems to be a focal point for the NGCB under Dreitzer’s tenure, which began in late June. The game can be a target for bad actors, as it is an environment in which players swap chips and cash back and forth with less casino involvement than other games.

In mid-July, several major Strip poker operators — Wynn, MGM, Caesars and the Venetian/Palazzo (Apollo Global) — changed their chip cash-out policies.

The companies will cash chips only from their own properties under the new rules. In other words, players are no longer able to cash Wynn chips at an MGM property, or vice versa. This appeared to be a coordinated company-level rule change rather than a regulatory change, as with salons.

“We believe this change was a good idea and a great example of our industry actively addressing [anti-money laundering] concerns,” Dreitzer told the Las Vegas Review-Journal 14 July.

Las Vegas tourism seeks stability from board in flux

For the three-member board, it is a tough job to foster innovation while also attempting to create a sense of stability. Dreitzer is the fifth NGCB chair to take office since January 2019.

He inherited a partial term from previous chair Kirk Hendrick; Hendrick took over for Brittnie Watkins, who was serving on an interim basis after Brin Gibson resigned in November 2022; Gibson took over for Sandra Douglass Morgan, who resigned in November 2020.

Currently, former Las Vegas judge George Assad is the most senior board member, appointed in January 2023. Former Reno city attorney Chandeni Sendall was appointed this January. Dreitzer’s appointment was welcomed because of his experience with both the state and the industry.

Prior to the NGCB, he held senior roles at Gaming Arts, BMM Testlabs, Ainsworth and others, but he began his career as a deputy attorney general. Stakeholders are hopeful this industry insight can result in better collaboration with the board.

Assad, who also worked in the casino industry for eight years, passionately advocated Wednesday for no salon minimums. While noting the importance of AML concerns, his view was that salon restrictions were a regulatory overreach. Dreitzer listened respectfully to these tangents, before returning to his core message: balance.

“That [minimum] creates a barrier to entry, frankly, related to individuals who think they can run a salon, but ultimately can’t,” Dreitzer said.

York, vice president of government affairs at the American Gaming Association, appeared on a prediction markets panel at last week’s Saratoga Racing and Gaming Conference and apologised to a large crowd before crossing the proverbial Rubicon.

Days after a second arrest that involved someone throwing an adult toy on or toward a WNBA court, York criticised an offshore prediction market for offering event contracts on the strange trend.

York made reference to a series of contracts at Polymarket that enabled users to trade on whether the object would land on a court during a live game. The AGA official made the comments on 11 August, the first day of the Saratoga conference. On the same day, Polymarket handled more than $70,100 on a binary contract to choose whether a fan would successfully launch a toy onto the court in that evening’s Connecticut Sun-Golden State Valkyries contest.

In a summer when integrity concerns about live betting markets have intensified, York questioned the appropriateness of such contracts.

“I’d be real curious to hear what the economic utility is for that type of behaviour, because it’s pretty pathetic to me,” he said on the panel.

Another panelist, David Aron, a special counsel at Lowenstein Sandler with prior experience working for the US Commodity Futures Trading Commission, agreed that there’s no “economic utility” in the “wacky contracts”.

Staking money on adult toy tosses

Phoenix police arrested Kaden Lopez, 18, on 6 August after he attempted to throw an adult toy onto the court at the Phoenix Mercury’s home game versus the Sun. The throw by Lopez didn’t land on the court, instead hitting a spectator who attended the game with his nine-year-old niece.

On the same night, a fan hit Indiana Fever guard Sophie Cunningham on the leg with a bright green toy, another act in a string of boorish activity.

On Polymarket, one event contract gave users the opportunity to trade on the colour of the next adult toy to reach the court. The structure of the contract, York suggested, creates an incentive for a syndicate to stake an individual to throw a green toy onto the court.

For arenas with a no-bag policy, there is a lower likelihood that a fan will sneak in the device, he explained, raising further integrity concerns. The markets on the Polymarket website generated considerable liquidity, with one user netting a four-figure profit.

York made the comments several days after the founder of a crypto meme took responsibility for the pranks in a post on X. The individual, who goes by the name Lt. Daldo Raine on X, noted that the group committed the acts in an attempt to market a crypto coin created by his online community.

In spite of the admission, Polymarket continued to offer the markets through 12 August. However, as of Thursday, the exchange did not have a live offering for the WNBA adult toy contracts.

A Polymarket spokesperson did not respond to a request from iGB for comment.

Applying an economic purpose test to adult toys

The concerns raised by the adult toy contracts are the latest in a contentious debate over the regulation of prediction markets by the Commodity Futures Trading Commission, which has had considerable turnover this year. Several leading prediction markets announced plans this month to offer various event contracts tied to the upcoming football season.

At the moment, prediction markets do not face the same regulatory and tax burdens as legal sportsbooks. As a result, some gambling industry groups believe those companies are operating on an unlevel playing field. Following the 2018 repeal of PASPA, those groups contend, the states are in better position to regulate sports betting than the federal government.

Last year, the CFTC approved a noticed of proposed rulemaking aimed at overhauling the agency’s process for regulating event contracts. The proposal sought to restore an “economic purpose test” for evaluating whether the contracts are contrary to the public interest.

On Wednesday, meanwhile, FanDuel announced a partnership with the CME Group to develop a new event contracts platform.

The event contracts will be subject to the rules of CME Group exchanges, pending CFTC review, the companies wrote in a joint statement.

Further integrity measures

Also on the Saratoga prediction markets panel was John Berlau, a senior fellow at the Competitive Enterprise Institute, a Washington DC-based think tank. Berlau did not opine on the adult toy contracts, but he noted comparisons with a fan who grabs a foul ball simply to win a legal sports bet. He also disagreed with arguments that place prediction markets at fault for bad behaviour of certain customers.

“It’s a slippery slope to try to blame this on a prediction market venue or on actual sports wagering,” Berlau said.

The panel was moderated by Michelle Cohen, a partner at Ifrah Law and counsel at iDEA Growth. Cohen emphasised that bettors cannot wager on everything on the regulated markets, noting that legal bets must be approved through state event wagering catalogues.

“It sounds like we need some additional integrity-based tools,” Cohen said.

While designated contract markets such as Kalshi are permitted to self-certify under CFTC regulations, Kalshi says it has taken steps to add protections for customers. In March, Kalshi announced a partnership with integrity monitor IC360, which CEO Tarek Mansour said will enhance its “ability to prevent bad actors” and report them to sports leagues and regulators.

Unlike Kalshi, Polymarket is not available yet in the US. Last month, however, the Justice Department concluded an investigation of Polymarket without bringing any charges. Roughly a week later, Polymarket completed the acquisition of CFTC-licensed exchange, a move CEO Shayne Coplan said paves the way for its re-entry into the US.

“We moved to Leeds sometime in 2010 and that was the one thing that, without a doubt, transformed the company,” says former SBG CTO Andy Burton. “I said it had to be no more than 10 minutes from the train station as we really wanted to be able to tap into that talent pool of people who could commute. So we moved into our first office in Leeds at Wellington Place.” 

Burton recalls a conversation he had at the time with SBG CEO Richard Flint about bringing platform development in-house. OpenBet was powering both the back-end and front-end of the SBG offering, but Burton says he knew early on that they needed to take control of the product’s front-end.  

“We didn’t have any people that could do that at that point because the tech team really was a bunch of infrastructure-type people and service management. There wasn’t any development capability at that point. It was all outsourced,” he recalls.  

Sky Bet taps Orange’s development team 

Burton was SBG’s technical director during the period. Upon moving the 150-strong SBG team to Leeds, he tapped into product specialists he had worked with at French mobile provider Orange between 2004 and 2008.  

“[We started with] half a dozen really great technologists, engineers, architects et cetera. It was really small scale when we got started. We didn’t call them product owners at the time, but business owners,” he explains. 

“At Orange they’d done a lot of web development and mobile development and I had managed that team. The ethos was always ‘we don’t need loads and loads of people, we just need really good people and let them get on with it.’  

“We didn’t hire anybody from a betting and gaming background. [We knew] frankly the smart people would learn from working really closely with people in trading or gaming operations.” 

In those initial stages, Burton chose to focus on building a scalable in-house platform for SBG’s Super 6 prediction game over the core gaming product. Super 6, a first-of-its-kind free-to-play prediction game, supercharged SBG to success after becoming hugely popular thanks to its tie-in with Sky Sports.  

“Every Saturday a few tweaks [were made to Super 6] and a few more features [were added]. The business owners really understood the value of how important that was, so we went from there,” Burton says.  

The next step was shifting the core Sky Vegas and betting products onto an in-house platform. Burton believes SBG was the first operator to completely own its front-end. 

Spotify tribes model and maintaining agility  

Burton cites Conor Grant as an integral player in the shift to an in-house front-end, coming into the business and understanding the value of owning its front-end. Grant was one of very few to have joined the business in its early days with industry experience. In 2010 he was hired as SBG head of sportsbook product management after spending three years as head of online for Boyle Sports.  

“We didn’t see ourselves as a sports betting or a gaming company. We saw ourselves as a technology company,” Grant tells iGB. “That allowed us to appeal to technologists and we were bringing in some of the best that the north of England could offer.”  

With that tech-first culture came ways of working borrowed from pioneering companies like Spotify. Grant cites the Spotify tribes model as a core principle for the business’ success. The approach sought to empower staff across the organisation, from product to marketing and beyond, helping them remain agile through extensive growth while carrying out thousands of releases a year. Grant reveals Sky Bet made around 30,000 releases in 2020.  

Another huge asset for SBG was the £800 million acquisition by private equity powerhouse CVC Capital Partners in 2014, which helped fund the expansion of back-end and product teams.  

While these elements powered SBG’s initial growth phase, Burton believes SBG’s ability to pivot and lead in certain areas helped maintain continued gains. One such area was responsible gambling. “To be part of Sky we had to maintain that reputation of the Sky brand,” he says.  

By the time SBG was sold to Stars Group, it had scaled up its tech team to about 800 people, over a nine-year period.  

Replicating the Sky Bet model 

Today Sky Bet is lauded as a blueprint for success across the sector. When the US opened its doors to online sports betting in 2018, the phrase “Sky Bet model” was widely uttered by execs and M&A strategists as many sought to imitate the operator’s deep-rooted integration with Sky Sports and its lasting legacy in the UK sports and gambling sectors.

In 2019 Fox Bet even launched a Super 6-style prediction offering to drive customer acquisition efforts in the US.

But no one was able to successfully replicate Sky Bet’s media strategy across the pond and brands like Fox Bet and Barstool Sports fell flat, failing to engage the core audience of sports lovers.  

Meanwhile in the UK, a much more mature and product-focused market, the onus for SBG’s peers has been on copying SBG’s unique technical strategy, which many agree was the force behind its dominance in the market.  

In June, reports that Flutter was putting over 200 roles at risk across its UK operations emerged. Racing Post reported many of the redundancies would come from Flutter’s tech and product team at its Wellington Place headquarters in Leeds, many of which were brought over from Sky Bet when Flutter bought the business in 2020.  

The decision follows its migration of SBG onto the Flutter Edge central platform, marking the end of an era for SBG’s legacy platform.  

From SBG to FBG: Fanatics leveraging Leeds’ talent pool 

But as they say, “one man’s loss is another’s gain” and a host of competing operators have reached out to these ex-SBG and Flutter folk to offer them roles elsewhere. Grant is among those leveraging Flutter’s outgoing technologists as he seeks to expand his 40-strong team at US-facing betting and casino operator Fanatic’s tech hub in Leeds. 

Fanatics (FBG) is operated on a fully remote basis, but it maintains a number of core functions at its Leeds base. Grant, who acts as president of gaming for FBG, says the office is home to part of the trading business as well as casino, operations and wider technical staffers. Plans to scale the team significantly are currently under discussion. It is looking to increase its current workforce in Leeds by 10% and move into new office space at Richmond House.  

“I know the market particularly well. There is a huge amount of talent in this area, in the north of England, with specific sector knowledge. My experience of technologists is they want to be working in fast-paced environments where they’re constantly releasing, being intellectually challenged and stimulated, and we tick those boxes by some distance in the way we operate. We’re a very lean organisation,” Grant says. 

“A number of us think this is a really good strategy for us to build and develop at scale.” 

Sky Bet’s Leeds legacy

He agrees Sky Bet built a foundation for sector talent in the city, but he acknowledges the rich history of digital transformation predating SBG in Leeds, including Orange and part of the NHS’ digital business.  

“Tom Reardon, the ex-chief executive of Leeds City Council was really instrumental in trying to attract businesses to Leeds, but Sky Bet played a big role in that because we were excellent at raising the profile of the city,” Grant added. “A lot of the great people who came to Sky Bet went and then spread their wings.”

SBG certainly left its mark on Leeds and key personnel moved on to lead tech teams at Evoke. Former SBG head of technology Paul McCormick is Flutter’s UK&I CTO today, while Rik Barker, ex-gaming director and then CTO for SBG, today is group CITO across Evoke’s portfolio of brands. Another group of tech specialists from SBG started cloud digital transformation consultancy Infinity Works, which was acquired by Accenture in 2021.  

“It’s gone full circle,” Burton concludes. “[Grant] was part of that cycle the first time around, where we hired loads of great tech people in Leeds and they’re thinking there’s an opportunity now with loads of people leaving Flutter, so let’s hire them.” 

LatAm continues to be perhaps the hottest region in the gambling world, with Brazil seven months into its regulated online market. Meanwhile tax concerns in Colombia and Peru continue to impact operators’ strategies.

Flutter made vital inroads into Brazil in 2024, acquiring a 56% stake in NSX, the parent company of Brazil-facing brand Betnacional. It has formed a new Flutter Brazil business, which will also encompass its existing Betfair Brazil brand.

The NSX acquisition is already paying off, with Brazil revenue growing 144% during Q2 to $44 million, offsetting a slight year-on-year decline for Betfair Brazil. This decline Flutter attributed to adverse sports results and re-registration friction from new KYC requirements.

With Brazil Flutter’s fastest-growing market in Q2, Group CEO Peter Jackson was asked whether further LatAm expansion was in the company’s plans.

Jackson responded: “When we sit here and evaluate what the opportunities are around the world, we think about Latin America, we think about many markets where we’re not operating. There’s some interesting opportunities there.

“They’re all in the mix as we think about where we’re going to be deploying our capital. Clearly, the team are thinking about other opportunities around the world in Latin America.”

Jackson and Flutter recognise the scale of Brazil’s potential, saying: “We retain a strong conviction that the market opportunity will be very significant, and that those operators with scale and the best product will win the largest share of the market. Our strategy is to elevate our Brazilian proposition.

“We’ve targeted quick wins in product and marketing, which we expect will deliver significant improvements to the customer proposition on both sportsbook and iGaming over the next 12 months, which we believe will place us well for future success.”

Entain ‘on track’ in Brazil

Entain reported a 21% year-on-year uptick in Brazil NGR during H1, in line with the company’s expectations after a successful transition to the newly regulated market.

Brazil was Entain’s fastest growing market outside the US, powered by strong results from the Club World Cup football tournament, which saw record player activity and turnover.

Brazil accounted for 5% of Entain’s H1 NGR, although CEO Stella David conceded the journey had “not always been plain sailing”, with compliance proving difficult as players of its Sportingbet brand had to re-register to satisfy new KYC requirements.

Tax in Brazil also led to a £28 million ($38 million) hit to Entain’s group EBITDA, with David also warning about the potential for black market growth. This warning comes as the country weighs up making a provisional GGR tax rise from 12% to 18% permanent, as well as new ad restrictions.

“I’m just saying there’s a lot of volatility and that means that we have to be agile in our approach to the market to make sure we navigate the right line,” David said.

BetMGM sets sights on 10% market share in Brazil

In August last year, MGM Resorts International partnered with Grupo Globo, Latin America’s largest media company, to launch the BetMGM brand in Brazil.

In its Q2 presentation, MGM reiterated its desire to reach 10% market share in Brazil through BetMGM, believing its deal with Grupo Globo will allow for greater flexibility in regards to marketing and investment.

“Our launch is making great strides as we are seeing all key measures increasing, including strengthening player fundamentals,” MGM Resorts International CEO Bill Hornbuckle said. “Our bullish long-term view of the Brazilian market remains unchanged.”

BetMGM is investing heavily in Brazil, with that spend focused on product in Q1. It will then shift to marketing in Q2 as the business looks to grow its brand awareness in the market.

“[In] Q2, we turned on the marketing with a reasonable level of aggression and we’re very happy about what we’re seeing,” MGM Resorts International Interactive president Gary Fritz explained.

“Player values are strong down there. We see nothing to give us any concern about the TAM and the long-term health in the market in Brazil.”

Betsson reaches record LatAm revenue in Q2

Betsson enjoyed a hugely successful Q2 in LatAm, with revenue in the region up 35.4% to a record €84.7 million ($99.3 million), driven by high customer activity and record deposit levels.

LatAm accounted for 28% of Betsson’s Q2 revenue, having been responsible for 25% of its revenue in Q1, with Peru and Argentina particularly singled out as key growth markets for the group.

“It is gratifying to see how we continue to strengthen our leading market positions in these countries through both strategic and tactical market activities as well as targeted product development,” CEO Pontus Lindwall said.

Sportsbook revenue in LatAm increased from €22.3 million in Q1 to €33.2 million in Q2, offsetting a slight drop in casino revenue from €52.2 million to €51.4 million.

Despite the record quarter in LatAm for Betsson, the company did also note significant headwinds in the region, with further ad restrictions and tax rises seemingly on the way in Brazil. Beyond this Peru and Colombia are also increasing their tax burdens.

However, Lindwall said the company’s view on Brazil hadn’t shifted, saying: “We remain with our view that in any newly regulated market, it’s a little bit shaky initially in terms of competition, marketing spending, potentially regulatory changes.”

Discussing future M&A, Lindwall explained: “We are a careful company. We don’t jump in, we don’t buy the first one we see there. We want the dust to settle a bit and then we will, of course, be ready for both our own expansion and M&A in Brazil.”

Codere Online cautious on Brazil, Mexico performance strong

Codere Online remains hesitant to enter Brazil, despite fellow LatAm market Mexico continuing to prove fruitful for the company in Q2.

Mexico revenue for Codere Online reached €29 million in Q2, 2.8% higher than the €28.2 million reported in Q2 last year, while adjusted EBITDA in the market also edged up from a €0.2 million loss in Q2 last year to a €0.2 million profit.

In the earnings release, CEO Aviv Sher said: “In Mexico, we were successful in growing net gaming revenue despite the 19% devaluation of the Mexican peso and grew our portfolio of active customers in the country by an impressive 36% versus Q2 2024.”

But while the company continues to flourish in Mexico, Sher reaffirmed the company’s caution on Brazil, telling analysts: “We took some of our experience in Spain and took it to Mexico, so we have already proven we are able to replicate our strategy and grow a market.  

“I’m sure that Brazil will come up in this call. To replicate [our model] in Brazil, we would need a lot of money.”

In the company’s Q1 results, Codere Online noted it was pulling back in Colombia due to the impacts of the 19% temporary VAT. Sher reiterated this on the post-Q2 earnings call, saying operations had been reduced in the market “to the bare minimum”.

RSI flourishing in Mexico, but Colombia headwinds remain

Rush Street Interactive highlighted Mexico as a particularly strong growth market in Q2, although concerns persist over the tax situation in Colombia.

Monthly active users rocketed nearly 42% across the LatAm region to 403,000 in Q2, with Mexico proving especially fruitful. Revenue from the market here was up 125% year-on-year, as well as increasing 40% from Q1 this year.

Rush Street Interactive CEO Richard Schwartz expects Mexico to become one of the company’s largest markets, saying: “We are very optimistic and continue to believe that it can be a very significant market for us for many years to come.”

However, the VAT in Colombia continues to prove troublesome, with Rush Street Interactive’s decision to offset the tax with a bonusing strategy damaging the company’s profitability in the market.

This led to Q2 net revenue from Colombia remaining flat, despite Rush Street Interactive’s GGR from the market rising by over 70%.

With the temporary VAT set to expire at the conclusion of 2025, CFO Kyle Sauers believes the company’s profitability in the market will reignite from the start of 2026.

Further LatAm expansion could be coming, too, with the company listing Chile, Ecuador, Brazil and Argentina as potential opportunities to add to its existing markets of Colombia, Mexico and Peru.

Super Group LatAm revenue nearly halves after Brazil exit

Elsewhere, Super Group reported declines in LatAm revenue, dropping to $5 million in Q2 from $9 million in the same quarter last year. Across H1, revenue in the region also fell from $16 million to $10 million.

Super Group attributed this to poor performance in Mexico, as well as the withdrawal of its Betway brand in Brazil.

For Kambi, the regulated market launch in Brazil helped the supplier to increase operator turnover in the Americas by 3.4%, despite a “slower than expected start”.

The Club World Cup proved particularly popular in LatAm for Kambi, driving approximately 80% of bets across its global network.

The intersection between sports betting and fantasy sports has created a subset of sports fanatics with a dedicated interest in both. Internal research from ESPN Bet indicates that a user with a fantasy team is about three times more likely to place a wager on sports than a non-fantasy player.

Penn Entertainment, which has a partnership with ESPN through which it brands its online sportsbook, is about to take advantage of that tendency.

On Monday, the operator announced the imminent launch this summer of FanCenter, a personalised hub within ESPN Bet that will allow customers to easily find wagering markets based on their favourite teams, players and fantasy football rosters.

With the imprimatur of the Worldwide Leader In Sports, ESPN Bet and Penn Entertainment believe the product offers bespoke integrations that have not previously been available on the market. A fantasy football user eager to whet their betting appetite will soon discover a slew of customised wagers on the ESPN Bet platform based on their weekly fantasy lineup.

“FanCenter introduces a completely new level of personalisation for ESPN Bet players and represents our biggest product leap yet,” said Aaron LaBerge, Penn’s chief technology officer.

How it works

One of the key features of FanCenter is immediacy. Take the first week of the NFL regular season, for instance. Let’s say your fantasy team includes Saquon Barkley, Ceedee Lamb, Justin Herbert, Brock Bowers, Jordan Addison and the Kansas City Chiefs defence. In that example, your fantasy team will have players performing in games on four different days of the opening week from Thursday 4 September to Monday 8 September.

Instead of waiting for the result of the fantasy matchup on Monday night, ESPN Bet will offer a number of customised parlays with the potential for quicker payouts. You might receive a three-leg parlay option containing a Barkley anytime touchdown, the “over” on Lamb at 100.5 receiving yards, and a Chiefs defensive turnover. A winning ticket could be cashed by Friday. Using the same example, another parlay may add legs on Herbert to finish with at least two touchdown passes and Bowers to score against the Pats.

Bespoke integrations

While ESPN Bet teased its new offering last fall, the operator preferred to wait until this summer for the ideal launch point. Over the last several months, the product team has honed FanCenter for increased app speed and a sleeker look.

The offering also builds on an account-linking initiative that enables bettors to jump from the ESPN main app to ESPN Bet in a matter of seconds.

The launch of account-linking last November drove an uptick in betting volume and engagement, ESPN Bet’s Mike Morrison noted at the time. Linked accounts also produced a “stickier” customer, Barclays analyst Brandt Montour wrote in a research note, resulting in added time spent on the app, increased bet frequency and a higher parlay mix. Morrison is optimistic that FanCenter will do the same.

“FanCenter is the perfect combination of fandom, fantasy and personalised betting all wrapped into the ESPN Bet betting experience,” said Morrison, vice president of ESPN Bet and ESPN Fantasy.

“FanCenter showcases how we can serve fans across our platforms in a way that nobody else in the market can because of our industry-leading ESPN fantasy platform and account-linking capabilities.” 

Driving customer acquisition

Based on the sophistication of the product, LaBerge views FanCenter not only as an acquisition tool for new users, but a retention vehicle for current ones.

ESPN Bet debuted in November 2023, and the new product should appeal to those who tried ESPN Bet before the current upgrades, LaBerge said. ESPN Bet will attempt to re-acquire those customers through FanCenter.

The next cohort comes from what LaBerge described as a “fanatical group” of core users that he predicts will love the new product. He anticipates that those players will continue to use ESPN Bet as their primary sportsbook. The final cohort comes from “new user acquisition,” a group LaBerge considers the most critical of the three.

Last season, more than 13 million unique players participated in ESPN Fantasy Football, according to Chris Jason, executive director of product management for the company. Besides curated player props and custom parlay offerings, FanCenter also contains “integrated functionality” that the operator says will enable users to browse player stats and trends to inform their prop selections. 

Still, questions remain as to whether entrenched bettors from the app’s main rivals will use ESPN Bet as their exclusive platform. More pointedly, can ESPN convince a traditional DraftKings or FanDuel user to convert to ESPN Bet full time for their betting experience?

DraftKings and FanDuel in essence maintain a duopoly in online sports betting, with national market share of nearly 75% combined. No one else reached a double-digit share in June, according to data from Citizens.

Earnings preview

The FanCenter announcement came three days before Penn Entertainment is to release second-quarter earnings on Thursday. According to Zack’s consensus estimates, Penn’s revenues are expected to come in at $1.73 billion, up 4.3% from the year-ago quarter. The operator is expected to report a loss of $0.04 per share, up 77% from the same quarter in 2024.

In May, Penn Entertainment CEO Jay Snowden stated that the company’s digital business neared an “inflection point,” adding that the Penn and ESPN teams were working on “delivering a differentiated experience” for customers. However, Snowden wrote in a letter to shareholders weeks earlier that Penn had underperformed company expectations with market share and financial performance from sports betting. Upon the launch two years ago, the Penn CEO initially targeted long-term market share of at least 20% by the end of 2027.

ESPN Bet has not disclosed an exact date for the launch of FanCenter, but LaBerge indicated that it will likely occur this month.

The joint venture between Entain and MGM posted strong Q2 results on Tuesday, with both betting and iGaming growth contributing to a 36% revenue jump. 

As a result, leadership said it is confident BetMGM will hit its full-year EBITDA guidance of $150 million, marking the first year of profitability since its formation in 2018.

“With over $150 million of EBITDA being generated this year, we may be in a position relatively soon where we could start returning cash to Entain and MGM Resorts,” CFO Gary Deutsch told analysts during its H1 earnings call.  

He also noted the operator had maintained a $150 million credit facility which remained undrawn. 

“We started the year with a good cash balance. We’re going to do $150 million at least of EBITDA, so we will have excess cash,” Deutsch said.  

When pressed on how much cash would be returned, the CFO said: “We’ll be in the position to figure that out. But with this guidance, we’re in a position that we can, if we choose, or if the parents choose to receive back cash, that transfer can be made.” 

What was the initial investment in BetMGM? 

BetMGM was established in August 2018 as a 50/50 joint venture between MGM Resorts and Entain, as the two operators sought to enter the US betting market shortly after PASPA was repealed.  

Both parties invested an initial $100 million each into the partnership, which sought to leverage MGM’s legacy branding and thriving Las Vegas business, alongside Entain’s long-standing tech and sports betting capabilities.

At the time the BetMGM deal was signed, MGM Resorts insisted its strategy would “significantly increase speed to market for both parties in an efficient and prudent manner, [while also lowering] execution risk and creating meaningful early-mover advantages”.

The model broke the mould in terms of how European operators were entering the US market and, while numerous competitors have already exited, BetMGM’s strategy has now been proven viable.

How much has Entain invested in BetMGM?   

But, like many of its peers in the US, BetMGM struggled to reach profitability in the first few years.  

This led to the parents investing more than expected. In BetMGM’s 2021 earnings it revealed the total investment made in the JV would reach $450 million in 2022. 

This brought the total investment amount in BetMGM to $1.1 billion by 2022.

Entain has said it invests slightly more than £300 million ($395 million) every year, between OpEx and CapEx, into the platform that helps operate BetMGM.

But speaking during the London-listed operator’s full-year 2024 results, CFO Rob Wood acknowledged the central platform also benefits the wider Entain business. 

“The way to think about it is of course our obligation to the joint venture is to provide the product and technology, and we have a process whereby anything that’s done specifically for the joint venture is recharged to the joint venture and so the cost of that goes through the P&L,” he told analysts.  

“We believe that [this platform investment] gives us sustained competitive advantage, as you all know online is a product-led sector — that’s how we compete. By investing that quantum every year it gives our brands every chance of capitalising on their podium positions and delivering strong growth into the future.”  

In July 2023, Entain also acquired Angstrom, a specialist US betting analytics provider, to bolster BetMGM’s microbetting abilities. The deal cost £81 million, plus contingent payments totaling a maximum of £122 million.

Again, while the investment was largely aimed at improving BetMGM’s offering, Entain expects to utilise its expertise across other markets where it operates its own brands.

What about MGM Resorts’ investment?

It is less clear exactly how much MGM has put into the JV over the years, but in its Q1 2025 results MGM CEO Bill Hornbuckle said the company was no longer investing any more capital in BetMGM.

“Those investments [including MGM Digital] are behind us and those businesses are really primed to grow,” he said.

While the JV was “moving in the right direction”, Hornbuckle said it would still require more investment on Entain’s behalf. “And they’re fully supportive of that,” he added.

Some analysts have called MGM out for not reaping the full returns from its JV. In a note following MGM’s earnings this week, sell-side analysts Seaport Research urged the operator to buyout Entain’s stake in BetMGM (or acquire Entain itself) “in order [for it] to unlock [BetMGM’s full] value”.

“The 50/50 ownership structure is a significant deterrent in unlocking greater value as is limited financial disclosure (although the latter is improving),” the note said of BetMGM.

Back in 2021, MGM put forward a takeover offer for Entain which was swiftly dismissed as Entain believed MGM had “significantly undervalued” it.

Making mistakes and turning its fortune around

After a slow progression to profitability, which is mirrored by much of the US market, BetMGM has turned its fortunes around.

Hornbuckle has cited underinvestment during certain periods as well as mistakes made on marketing and product development as reasons for this.

Speaking during JP Morgan’s Gaming conference on 13 March, he said BetMGM had mistakenly spent $13 million on a Super Bowl ad in 2024, which he now regretted.

“I would say historically we did some things that we’ve learned from, marketing wise and expense wise,” he told the audience.

Management described 2024 as an investment year for BetMGM, a turning point during which the operator became increasingly strategic about its marketing and promotional strategy and really leveraged MGM’s retail sportsbook in Vegas.

It launched the market’s first single wallet enabling players to register and bet in person while in Las Vegas and then transition their funds to the online sportsbook across multiple states.

“We see a lot of green shoots,” Hornbuckle said during the March conference. “Particularly in January, February and March, so far.”

This time, he said, the company’s forecast for a positive full-year EBITDA was obtainable.

“Everything we have seen would suggest that the projection we’ve given is real and that we think we can hit that target.”

Navigating a challenging US market

BetMGM had expected to reach profitability in the second half of 2023. JV CEO Adam Greenblatt told iGB in June that year he would achieve that by expanding its NGR margin and the business’ tax burden.

“Otherwise, there’s no change,” he said at the time.

But uncertainties, a slowdown in new states launching and increased tax burdens in certain states made the US increasingly difficult to navigate.

By this point, DraftKings and FanDuel had established their comfortable duopoly for online betting in the US, which made it challenging for others to gain much market share.

A much stricter approach to customer acquisition and a pivot to targeting higher-value players at BetMGM followed, and Greenblatt told investors in its H1 2025 results that the sportsbook had grown revenue by over 60% during the period, despite reducing marketing and its base of active players.

Under its new system the operator avoids investing in unprofitable players and over-investing in profitable players.

Analysts at Truist Securities reported BetMGM market share stood at 14% in Q2, reflecting 22% in iGaming and 8% in online betting.

Across iGaming, player volume was up 38% for monthly actives in the period. Greenblatt cited a portfolio of unique games and a live casino partnership which streams from MGM’s Bellagio as reasons for this uptick.

While iGaming growth at BetMGM has been steady over the years, the online betting business has only just reached profitability.

Notably, this is a milestone many of its peers have not yet reached.

Steven Pizzella, analyst at Deutsche Bank, reiterated MGM maintained an attractive valuation thanks in part to BetMGM’s inflection to profitability, plus potential for future strategic actions in in the JV.

Will MGM invest further in BetMGM?

While Entain will continue to fund the development of BetMGM’s tech platform, further investment from MGM is a possibility if another big US state were to move online, Hornbuckle has said.

“If California or other large markets — Texas or Georgia — [come online] we would be aggressive there like I think all others would be. And so that would take some capital,” he stated during MGM’s first quarter earnings call in 2024.

“We would never say never, to be clear. And I’m speaking on behalf of MGM in terms of its growth and what it wants to do with that business,” he said.

“If we get product really right and we see an opportunity to lean in, we will.”

The first headwinds emerged near Memorial Day when Illinois legislators passed the nation’s first-ever tax on sports wagering handle. Then, to compound matters, Republican lawmakers tossed an amendment into US President Donald Trump’s “One Big Beautiful Bill” that eliminates a percentage of write-offs that gamblers can deduct on their annual taxes.

For sports bettors in Illinois, the tax changes present a “double whammy” to their earnings potential. Several operators have responded to the new tax by announcing plans to pass the costs along to customers. At the same time, sportsbooks have been challenged by a new competitor in prediction markets, which have fewer tax burdens and less regulatory hurdles.

The tax changes raise serious questions of whether top sportsbooks will need to bolster their VIP programmes to incentivise play for high rollers. Across the pond, in the UK, VIP programmes have come under pressure from regulators that have established strict standards to curb rates of compulsive gambling. All in all, the last-minute policy shifts have left C-suite officials with a busier calendar than expected this summer.

An outsized percentage

While VIP sports bettors only comprise a sliver of an operator’s total customer base, high-value customers represent an outsized portion of a book’s overall handle. Last March, Fanatics ranked second in New Jersey with a market share of 23.5%, topping gross gaming revenues from DraftKings in the month.

Multiple channel checks from Eilers & Krejcik Gaming ascribe the figures to losses from one customer described as the biggest losing customer “by a mile”.

There are other instances where VIP activity prospered at leading US books. Prior to its acquisition by Fanatics, PointsBet generated about 70% of its 2019 annual revenue from VIP customers, the Wall Street Journal reported. Those customers, according to the Journal, only represented roughly 0.5% of its customer base.

By joining a sportsbook’s VIP programme, customers can receive certain perks such as boosted bets, free wagers and rebates. But leading books have faced increased competition from prediction markets, which can offer more favourable odds due to the exchange-wagering model.

A tax advantage?

Kalshi, a prediction market that offers event contracts on sports, saw multiple six-figure trades on the Eagles to win the Super Bowl in February. Then, in April, some high rollers flocked to the site during Masters week. One individual purchased $665,000 in buy contracts on Collin Morikawa to not win the Green Jacket. Morikawa finished eight shots behind champion Rory McIlroy, resulting in a payout for the customer of $30,000.

Those who trade with Kalshi can capitalise on a tax advantage under the new rules. Vijay Dewan, co-founder of Pine Sports and a former senior counsel at Deutsche Bank, discussed the implications of the federal tax policy in a LinkedIn post.

Sweeteners for VIPs

The dynamic created a lively debate at this month’s National Council of Legislators from Gaming States summer meeting in Louisville. Chad Beynon, head of US gaming research at Macquarie, served as a panellist for a session on major topics impacting the industry.

Asked if operators can offer new incentives as enticements for their VIPs, Beynon pointed to perks for high rollers in Las Vegas such as concerts at Caesars Palace and the MGM Grand.

Over the last several weeks, Beynon held a call with a top 10 sportsbook. One option under consideration is arranging meet-and-greets for VIP customers with athletes from their favourite teams.

“You can have dinner with someone on the Knicks like Josh Hart,” Beynon told iGB.

VIP restrictions in the UK

Legislators on the state and federal level are still digesting the findings of last week’s UK Gambling Commission report on VIP modifications, in order to gauge whether changes are needed in the US.

The report, issued on 17 July, found that customer volume for VIP programmes has plunged at least 90% since the imposition of strict regulations in 2020 aimed at ending predatory treatment of high-risk gamblers.

The stricter regulations require operators to conduct mandatory affordability checks for any customer interested in becoming a VIP. Additionally, operators are now mandated to have updated information on a VIP customer’s sources of funds

In March, US Representative Paul Tonko of New York and Senator Richard Blumenthal of Connecticut, both Democrats, released a new version of the SAFE Bet Act, a proposed bill that seeks to create a federal framework for sports betting. The latest incarnation contains a provision that would establish certain restrictions on VIP sports bettors.

Fair Bet Act update

Under the Big Beautiful Bill, gamblers can only deduct up to 90% of their annual losses from their federal income taxes. Previously, federal law allowed gamblers to write off 100% of their losses in a given year.

Phil Galfond, a professional poker player, roundly criticised the tax policy on social media.

“A pro who earns $200k a year might have $3 million in winnings and $2.8 million in losses,” Galfond wrote. “This means earning $200k and being taxed as if they earned $480k. This new amendment to the One Big Beautiful Bill Act would end professional gambling in the US and hurt casual gamblers, too.”

US Representative Dina Titus of Nevada has introduced a bill that would restore the full deduction. The bill, the Fair Bet Act, has received bipartisan support, with sponsors from both sides of the aisle.

On Friday, the House Ways and Means Committee was to hold a field hearing on the federal bill in Nevada. There, Titus planned to state her case for reinstating the full deduction in 2026.

On 15 July the bill made it through the first reading in parliament and was approved by 83 votes to 39. It will now advance to the Governance and Administration Committee and a consultation has been initiated to draw feedback from the industry.

Once the legislation is passed, up to 15 operators will be granted licences in New Zealand’s regulated iGaming market, which is expected to go live by July 2026.

According to legal experts, this is a particularly tight timeline, considering the time needed for a successful consultation period. They note that various important regulatory details have also been left out of the bill.

Jamie Nettleton, partner at law firm Addisons, tells iGB: “Having looked at the bill, there are a lot of gaps still to be filled. In my view, it’s lacking in detail with respect to the legislation. There are a lot of broad brush statements, in terms of how the licensing should work.”

Samuel Gauci, a senior foreign lawyer at Addisons, agrees, adding the consultation time will be particularly short if June 2026 remains the targeted launch date.

“The problem is they’ve given themselves such a short timeframe from the announcement to bringing it into play, that they’re not going to have the consultation time they need. Consultations are ongoing, but will they have enough time to draft regulations?”

Is New Zealand’s iGaming bill timeline feasible?

An issue for operators at this stage is whether they can budget effectively to enter the auction on time. The vetting and auction process is set to begin in February 2026.

With the lack of information regarding many of the specifics required within the regulation, it will be difficult for operators to decide whether it is worth putting themselves through the process.

“This really is crystal ball stuff,” Nettleton says. “The government is looking for 15 operators and that’s essentially what they would like to get. How will they get to 15? What price do you put on the option process? It’s got to be economically viable. You won’t keep your competitors out with 15 licences available, so you have to factor in that they will be there.”

Defined terms in the bill

Brooke van Velden, New Zealand’s minister of internal affairs, introduced the bill in April. Under the terms of the bill, operators would have to pay a goods and services tax and an offshore gambling duty of 12%.

They would also be required to contribute 1.24% of profits to a mandatory levy, which would fund services to prevent gambling harm.

Gambling advertising would be allowed with limitations, including a ban on advertising during times that children may view ads. Suitable age verification tools will be required.

Undefined terms

Further advertising restrictions are likely to include a ban on paid endorsements by influencers, celebrities and athletes, as well as a requirement for a portion of each gambling ad to be dedicated to harm minimisation messaging. It is believed, however, that inducements and bonuses will likely be permitted.

The problem with those particular measures is they are not set in stone, so after the bill passes into law, many of these regulations would need to be determined by the regulator.

“Operators need more information. The bill is not satisfying them at this time. When they have that information, they can decide if they want to join the auction process or not.”

Operators can obtain one of the 15 licences available by entering into the auction process Gauci outlined.

Several operators have already expressed an interest in claiming a licence, including SkyCity, 888, Bet365, Super Group (owner of Betway) and TAB NZ, the monopoly operator of sports betting in New Zealand. According to RNZ, however, Van Velden has previously stressed that TAB NZ will not be able to apply for an online casino licence.

A confusing approach from the coalition

In the 2023 general election, the Labour Party lost its majority, leading to a change in government. A coalition was formed between the National Party, a right-leaning party which has the largest number of seats, and the ACT Party and New Zealand First.

Potential changes to gambling legislation have come to the fore since. On top of the current progress the Online Casino Gambling Bill is making, TAB NZ, run in partnership with operator Entain, was recently granted a monopoly to run the country’s online sports betting market.

Offshore operators, which had previously been allowed to operate in New Zealand, were banned, with Betfair recently removing its services from the market.

Jarrod True, director at local law firm True Legal, believes the shift to a centre-right government has given iGaming a boost in the country after putting it back on the agenda.

True tells iGB: “The incoming administration inherited a struggling economy in the wake of Covid-19 and viewed the regulation and taxation of online gambling as a pragmatic means of generating new revenue without increasing the tax burden on voters. Had a left-leaning government been elected, it is unlikely that legislation enabling an expansion of gambling would have been pursued.”

Is there mixed messaging in New Zealand?

The government’s willingness to open up the online casino market, while also placing more restrictions on the online sports betting market, could be perceived as mixed messaging.

“When New Zealand was first talked about as a potential destination for licensing, people were approaching us on the basis they would be able to operate all verticals, other than lotteries [lotteries are operated exclusively by Lotto New Zealand]. The approach to casino and sports betting seems completely inconsistent,” Nettleton adds.

True highlights this by emphasising the huge value placed on the racing industry and, subsequently, the betting industry in New Zealand.

“The racing sector is highly valued in New Zealand, both for its economic contribution and the substantial number of people it employs. Political support has also played a role, particularly from Winston Peters, leader of New Zealand First, who is a longstanding advocate for the racing industry,” he adds.

What’s next for New Zealand’s iGaming bill?

Should it pass through the Governance and Administration Committee, the bill will move to a second reading in parliament before being sent to the Committee of the Whole House. Van Velden previously indicated that this would happen by 17 November.

While the bill is expected to be signed into law, there could still be issues from opponents in a number of sectors.

Prior to the first vote on the bill, various politicians spoke out against it, including Labour Party politician Lemauga Lydia Sosene, who argued there is not currently a strong enough plan for gambling harm reduction.

Additionally, the land-based sector in New Zealand could have issues with the regulations when they are confirmed. The non-casino gaming machine sector in particular is operated by non-profit entities who return their profits to the community through grants. The online casino regulation is not set to subject operators to the same restrictions as the land-based sector, such as maximum bets and prizes on gaming machines.

“Implementing the new legislation and regulations is unlikely to be without challenges,” True says. “The government is expected to face opposition from problem gambling treatment organisations, who are already advocating for a complete ban on gambling advertising. These groups perceive the proposed regulatory framework as too lenient and insufficient in addressing the risks associated with gambling-related harm.

“While gambling-related issues typically generate significant public feedback and concern, the current administration remains committed to launching the system.”

Black market protections needed in New Zealand

Nettleton ultimately believes the government regulating iGaming is the right thing to do, but he says more restrictions will be needed to curb the black market.

“Let’s be very clear: the government are doing the right thing by creating a regulated market. It’s better than what they had beforehand with optional access and no control. That ticks one box, but if they make it too hard to enter, there is still a real risk of a black market. That’s the balance you need. More restrictions means more attraction to the black market. The operators will participate, so long as it’s reasonable for them to do so,” he concludes.

If it’s emotional, it’s essentially an appeasement to people that want gambling reined in and the vulnerable (and non-) to be protected to the ultimate degree.  

Of course, it could be both emotional and logical, they’re not exclusive paths. But it’s not, or this would be a really short article, and it’s not. 

I’ve spoken in the past about how having too many middle-class voices in the media, on the regulatory side, and within the industry’s critics (and arguably within the industry itself) means there is a disconnect between well-intentioned player protection and real-world player protection.  

People who have never experienced crushing and inescapable poverty have generally not been in a genuinely hopeless situation, so how can they truly understand what a player is going through and why decisions are made? 

UK gambling credit card ban a ‘partial’ success

I had in mind that a credit card ban was the ultimate “middle-class speaking down to working-class gamblers” protection. In Europe, my home market of the UK was the first to bring in a ban back in 2020, and the Ontario-based Greo Evidence Insights has since commissioned an analysis of the ban’s implementation and efficacy. 

That analysis, done by the National Centre for Social Research (NatCen), asked whether the ban on cards created friction for players gambling with borrowed money (and we will come back to this idea later, certainly). Its findings showed that – as defined here in Greo’s own summation – it was a partial success. A little like grenade-proof underpants, you might say.  

Implementation got a big green tick, but “the increased friction imposed by the credit card ban did not always result in changed patterns of gambling”. That the study’s period coincided with Covid 19 probably didn’t help the figures much, either, but they worked with a perfectly solid sample size and made every effort to provide a meaningful report.  

Perhaps most interesting though, combined with the previous quote, is this: “Overall, the ban was perceived to be a positive change by people who gamble; friends and family affected by gambling; and gambling treatment/support providers.” 

Perception of credit card bans

A credit card ban certainly appeals when it comes to perception and profile then. And other European countries have followed suit: the Netherlands has been trying to push a ban through (and given how regulation there has been, I would expect this to happen), Ireland has done much the same, and several other countries are looking at links between credit card betting and problem gambling behaviours.  

Sweden, which is no stranger to over-regulation and driving players offshore, proposed expanding its current credit card betting ban in June this year.  

Swedish finance minister Niklas Wykman said bluntly that players “simply should not bet with borrowed money”. Right, because a credit card is the only way that this can happen. 

If you remove credit cards from the picture, you remove a relatively easy way to monitor source of funds, and players then potentially move to more cloak-and-dagger methods of moving funds into their gambling wallets.  

So in terms of player protection, a credit card ban might be shooting the player in the foot – then reloading the gun and handing it back to them to see if they fancy shooting the other foot, too. 

As industry expert Sarah Ramanauskas notes: “[NatCen] found something really interesting: for people who weren’t struggling with gambling, the ban was fine. They just stopped using credit cards, no issue. 

“But for those experiencing moderate or high-risk gambling problems, the behaviour didn’t really change. They still borrowed money and still found ways to fund gambling through credit, just via different methods. So something meant to protect people wasn’t really protecting those most at risk. In fact, it might have made things worse, pushing people towards payday loans or unregulated borrowing instead of monitored Visa or Mastercard transactions.” 

Other forms of borrowing for gambling 

Alternative borrowing paths can be problematic – and outside any mechanisms that exist currently to try and monitor player behaviours.  

“Ultimately, people who are desperate to win back the money they’ve lost will do anything to try. That’s what takes up all their mental energy and, if you ban credit cards, people will simply turn to other forms of borrowing that regulators can’t see,” Ramanauskas adds. 

“At least with credit cards, FCA processes exist to monitor and protect vulnerable consumers. Payday lenders don’t operate with the same oversight and they don’t care about exploiting vulnerable customers.” 

And banks and traditional lenders – thanks, it seems, largely to GamCare’s work – are becoming more active in looking at what we’re doing with our money, it seems. 

Graeme Cumming, vulnerable customers strategy manager at Santander, says: “At Santander, we believe that the bank, although not responsible, does have a part to play in gambling harm prevention. We have built a suite of interventions, including letters and text messages, to provide timely signposting to support for customers at risk of financial detriment due to their gambling.” 

How responsible are UK credit cards users? 

According to the UK Finance January 2025 report, the UK has 53 million credit card accounts – that’s more than one per adult – and, of those, 36.5 million had an outstanding balance after month’s end. Which means that 17 million card accounts didn’t have any balance rolling over, they were cleared in full at the end of the month. That’s pretty decent in a cost-of-living apocalypse.

Miraculous, even. And it suggests an awful lot of people use credit responsibly – so why are credit cards used for gambling?

Andrew Tottenham, managing director for consultancy Tottenham & Co, suggests it might be a lot to do with convenience, certainly initially, but notes that as a payments device it is uniquely pretty poor for gambling purposes. He tells me: “[Credit cards were] never designed as a two-way transactional medium. 

“It doesn’t necessarily do what it’s intended to do. That’s my thinking. Is it a good idea that people gamble with money they don’t have? No, it’s not a good idea. Of course it’s not. Does stopping credit cards stop people from gambling with money they don’t have? No.

“Does it stop people with a problem with gambling? Gambling with money they don’t have doesn’t stop them. No, absolutely not.” 

Not a two-way street 

So it’s inefficient – because of that two-way street thing, credit cards don’t work like debit cards. In many, many markets, a transaction has to be refunded to its originating source. You pay cash, you get cash refunded; pay with a card, a refund has to be made to that card.

But a gambling transaction isn’t a refund, and it has no good earthly reason to be put back on the card, so it becomes a pain for player and operator. And anything that’s not simple is often expensive.

This, however, is changing, as Jonathan Michaels, principal of Michaels Strategies, explained to us. “It’s shifting. Originally in the US, you had to withdraw using the same payment method to prevent fraud and money laundering. Now, operators try to find practical ways to handle this. Players who deposit using a credit card can often withdraw using another method if needed,” he says.

Credit card acceptance rates

Credit cards also have much lower acceptance rates, as Jonathan explains. His expertise generally involves the US, but the same principles can be applied almost globally.

“There are a couple of key issues with credit cards in gambling. First, acceptance rates are much lower than debit cards. Debit card acceptance in the US is about 95%, while credit card acceptance is around 50%-60%, because many banks simply refuse gambling transactions using credit,” Michaels notes.

“In the US, gambling transactions have the Merchant Category Code 7801. When you try to deposit with a credit card, the bank sees it’s a gambling transaction and can approve or decline it. Because gambling is considered high-risk, their risk triggers are more sensitive than for, say, buying gas or groceries. 

“Another issue is cash advance fees. Using a credit card to deposit for gambling typically triggers a cash advance fee, which can be significant – sometimes $20-$30 per transaction. Many consumers aren’t aware of this.” 

This fee brings us to one of the reasons the industry often cheekily (and quietly) doesn’t mind a credit card ban so much: chargebacks. 

Two categories (identifying chargebacks)

If you’re not familiar with chargebacks – and honestly, I wasn’t – Nick Imperillo, GeoComply’s risk services manager, explains the two types perfectly and highlights the fact that some players might be operating from a more… cynical starting point with a chargeback.

“When we think about chargebacks in the gaming space, there are actually playbooks out there – sometimes on the dark web, but honestly, even on places like Reddit – where you can find guides on how to ‘win’ your chargeback if you decide to dispute a charge with an operator,” says Imperillo.

“Chargebacks generally fall into two categories. The first is first-party fraud, where the legitimate cardholder themselves makes a dispute with the merchant – whether it’s gaming, Netflix, Uber Eats, or whatever it might be. Then there’s third-party fraud, where you didn’t actually make the dispute, but someone else used your card details and you end up reaching out to your bank for protection.”

First party fraud is often buyer’s remorse

He adds: “What we hear from our partners – and what we see in our data – is that first-party fraud, which is often just buyer’s remorse, actually accounts for about 75% of chargebacks in the online gaming space. The people initiating these disputes are often verified users who have completed KYC, and due diligence has already been done on their accounts.

“Yet they are the ones initiating these disputes with their banks, which the operators then have to fight. And it’s absolutely a part of everyday operations. Before GeoComply, I used to run a fraud and AML team for one of the major North American sportsbooks, and chargebacks were one of the key metrics we used to determine the health of our risk management programme.

“Even if I didn’t have a chargeback problem, it was still a looming requirement and an important signal for how well I was evaluating risk on individual accounts.” 

Chargebacks aren’t ‘catastrophic’

Chargebacks are sometimes talked about as a significant issue (and I don’t doubt for one moment they’re a pain), but in the US, Michaels suggests that credit card payments make up only about 5%-10% of the transaction volume.

It’s not insignificant, but would losing that really cause pain? “They’re a notable issue but not catastrophic. Generally, chargebacks run at about 0.6%-0.7% of transactions, which is lower than most ecommerce businesses but still material. Chargebacks can occur when consumers see the cash advance fee or don’t recognise a transaction and claim it wasn’t them,” Michaels says.

Michaels also makes a great point – would operators really lose that 5%-10% of business if they couldn’t deposit with a credit card?

“Most gambling operators offer a wide range of deposit options – cards, open banking, PayPal, Venmo and more – to meet players where they are. Would cutting off credit cards materially impact their business? Maybe, but it might not be the worst thing operationally,” he explains.

“Several states in the US – Massachusetts, Iowa, Tennessee, Maine and Connecticut – already restrict credit card deposits for gambling. Operators may eventually block credit cards nationwide just to simplify operations.” 

Are players protected through credit card bans? 

So we come back to player protection when we wonder about the viability and efficacy of a credit card ban.  Sarah Ramanauskas’ point about players then using non-traceable funding sources is highly relevant, as it seems to be the main argument for not banning credit cards.

She elaborates: “[A ban] also depends on what a credit card represents to someone. For some, a credit card isn’t really ‘credit’ because they pay it off each month without stress. For others, particularly those struggling financially, a credit card represents breathing space – an ability to buy necessities or keep going. When you’re living pay cheque to pay cheque, a credit card is very much money you don’t have and will need to pay interest on. 

“If you’re someone struggling financially and gambling, using a credit card feels like a temporary solution. To regulators, this is seen as bad, but for many people, it’s how they manage day-to-day pressures. The problem is, how do you tell the difference? How do you know, when looking at a gambler’s account, if they’re financially secure or if they’re hiding from the window cleaner because they can’t afford to pay him? That’s where well-designed affordability checks should come in.” 

Credit card use doesn’t always mean gambling problem

And Michaels reminded us of a study done when he worked for Sightline. “When I was at Sightline, we did a study in Nevada on payments as a tool to identify problematic gambling behaviour. About 95% of players showed no issues, while 1% were high-activity VIPs, and another 1% made many small deposits with high failure rates, indicating potential risk,” he notes.

“Payments data, including credit card usage, can be a useful tool to identify risky behaviour, but using a credit card does not automatically mean someone has a gambling problem.” You can read more about this study here, but ignore the hilariously hyperbolic headline.  

The last word (almost) 

The last word in this article – apart from mine – has to go to Charles Cohen, of the Department of Trust. I asked his thoughts on credit card bans and he said to look at some data. So we did. 

Now, you remember I said we would come back to people gambling on credit and credit being in many forms? Overdrafts are also – without question – a form of credit. We looked at a set of data gathered from 340 UK-licensed gambling sites covering sports betting, casino, bingo and poker.

It detailed over 74,000 deposits (not players, individual deposits), covering perhaps 10,000 players – however, don’t get that figure stuck in your head as the data covers six months, so players almost certainly deposited more than once. Some banks were also stripped out as they don’t give balance data and it’s all from the second half of 2024. 

So what did we learn? 96.4% of all gambling deposits were made from bank accounts that were in credit at the time of the transaction.

That’s a huge figure — surprisingly so given the ubiquity of overdraft agreements. Also, interestingly, the average deposit from a credit balance was £21.

The other 3.58% were minimally overdrawn, as Cohen explains: “Most were overdrawn by less than £100, and only 0.55% were overdrawn by more than £1,000. Interestingly, 1.3% were overdrawn between £100-£500, which is where most overdrafts typically sit.”  

Credit card bans don’t stop credit use for gambling

But… wait for it… “Here’s the key: the average deposit size is lower for people in overdraft than for those depositing from a credit balance. 

“The data here shows a simple truth: credit card bans do not stop people from using credit to gamble. 

“The world has moved on since credit card bans were introduced. Now you have non-traditional credit sources like Klarna, payday loans and soft credit, often unsecured and unregulated, that can be used for gambling just like a credit card. 

“Ironically, people may be in a stronger position if they gamble on a credit card because they can claw it back through a chargeback.” 

The (actual) last word – credit card versus overdraft

He sums it up succinctly: “The main beneficiaries of a credit card ban aren’t vulnerable customers, but gambling companies, as they no longer have to deal with costly chargebacks.” 

Sure, it can be argued a credit card and an overdraft are different things – but the point for bans already in place, and those looming, is to create friction for players and for this friction to make it unappealing to play with money they don’t have.  

Credit cards are just one of those potential avenues, one that you could argue is really only a cul-de-sac, and only that because of the convenience of availability with adults worldwide. If you want to stop people playing with money they don’t have, you’re going to have to look much further and wider to do that – but also remember that you’re removing an easily traceable, monitored and regulated form of payment.

Nonsense over common sense

As Sarah Ramanauskas says, the ban partly makes an operator’s life a little harder too, and hamstrings us from some player behaviour data: “Now, with the ban in place, operators have to trace the source of funds going into a player’s debit card. It complicates the process of understanding where the money is coming from, making it harder to monitor harmful behaviours.” 

The next time a credit card ban is mooted in a market, the industry might quietly cheer because it’s a headache removed, there is little to no evidence of players disappearing after a ban (other than to offshore casinos that take credit cards, but that’s another story) and, yay, no more chargebacks. 

To answer our initial question though: common sense or nonsense? I’m leaning strongly towards nonsense. It’s mostly performative, stops player data gathering that could be really useful and absolutely does not stop people gambling with money they don’t have.

It’s a thumbs down from me, Jeff. 

“Sport is now more people-focused,” says Karl Danzer, SVP of Odds Services at Sportradar. “Team sports are more personality-led. Not all organisations like that – it hands players the power – but it plays a big role in how people bet” 

Danzer is among a growing chorus of voices in the industry noting how generational and technological shifts are converging to drive the popularity of player-specific markets. From increased investment in micro-betting to product innovation in bet builders and same game parlays (SGPs), sportsbooks are rapidly adapting to a reality where fans follow players more than teams. 

From team allegiances to player loyalty 

“If you look at older generations and in the European space with football, how you grew up was to support a team first and foremost,” Danzer explains. “That has always historically been different in US terms. The whole draft concept usually means players don’t stick with a team and the fans might follow the players over the team.” 

This shift has only accelerated with the rise of social media. “Now the players have the platform to promote themselves over the team,” Danzer adds. “This is now not only the superstars of the team but a much wider proportion of the players.” 

This star power and direct-to-consumer access have changed how fans engage – and how they bet. “It is logical to think this will lead to more people betting on player markets,” Danzer argues. 

Micro-markets and personalisation 

Sportradar is responding to the shift with targeted investment. “We are definitely seeing the growth of player markets, particularly within bet builders and SGPs,” Danzer says. “One of our key strategies is that we are investing in micro player markets to help our clients meet increased consumer demand.” 

These micro markets are designed to create real-time, player-specific betting opportunities.  

“How we build markets will be, on the one hand, around the specific individual and then with the characteristics of the actual player,” says Danzer. “That would appeal to people who follow a specific player.” 

Danzer sees this not only as a product shift, but as a fundamental opportunity for sportsbook growth.  

“It is easier to convert someone to sports betting if they are following a player,” he says. 

The SGP surge 

Tom Daniel, SVP of trading at Huddle, agrees with Danzer’s assessment. He points to structural aspects of US sports – discrete, measurable events like pitches, plays and possessions – as naturally conducive to player-focused betting. 

“Our data reinforces the dominance of player props,” Daniel says. “Six of the top seven most popular SGP markets are focused on individual performances. Player props represent approximately 70%–75% of all bets placed in this category.” 

He attributes part of this trend to the cultural embrace of statistics among US fans. 

“Take baseball, for instance. Sabermetrics has been around since the 1970s,” Daniel notes. “Fans have long been accustomed to breaking down every aspect of a player’s performance.” 

Daily fantasy sports (DFS) have also played a pivotal role.  

“Many of today’s sports bettors will have played DFS and so will be extremely familiar with assessing and taking an opinion on player performances,” Daniel says. “This naturally crosses over into betting on the actual metrics.” 

A European shift 

While the rise of player props may have US origins, it is no longer a North American story alone. 

“We’re seeing a growing demand for player-specific markets in Europe,” Daniel says, citing football’s shift toward player-centred engagement. “Players are becoming brands in their own right, with massive social media followings and influence.” 

Marc Thomas, managing director of Algosport, echoes the sentiment.  

“The trend is clear in European football and has certainly accelerated over recent years,” he says. “Player props now feature much more heavily than previously.” 

Thomas notes that the 2024 Euros and Copa America tournaments acted as catalysts. 

“These tournaments were almost perfect for in-play bet builders,” he explains. “We see no reason why the proportion of bet builders struck in-play versus pre-match will not continue further, becoming the dominant revenue driver in the near future.” 

At Algosport, Thomas says, the infrastructure is in place to support this trend.  

“We allow end-users to truly turn their opinions on a particular match or player into a bet that can test their knowledge and opinion against the bookmakers’ odds.” 

Sports betting innovation at the edge 

Beyond traditional props, operators are exploring even more granular experiences. Tomash Devenishek, CEO at Kero Sports, says the future lies in contextual, AI-driven betting markets. 

“Imagine a scenario where a player goes on a scoring streak, and the betting platform instantly offers and elevates a prop like ‘Player X has scored 14 points in four minutes – will he score over 25 in the half?’” Devenishek says. “At Kero, we’re pioneering this approach, delivering real-time, contextual micro markets.” 

Devenishek sees this as the natural evolution of the market. “It makes the popular offering more relevant and contextual while reducing the search effort on the user’s part,” he explains. 

While some platforms attempt to achieve this manually, he says the only scalable solution will come via automation and AI.

Challenges and considerations 

Despite the promise, challenges remain. “It’s not good enough to try and fudge the pricing with a priori guesses at correlations anymore,” Daniel warns. “Modern sportsbook architecture must be robust enough to handle large numbers of SGP requests, each requiring hundreds of thousands of simulations of games.” 

Risk management is also a hurdle. “Modern systems can detect potentially large payouts across similar but non-identical SGP bets,” he says. “But not all the challenges have been overcome.” 

Danzer adds that while the logic of personalisation and demographic targeting is sound, the data is still emerging. “It seems logical that younger people are playing more on player props,” he says. “But whether it is true, we will find out.” 

He is cautious about overestimating player props’ role in customer acquisition. “I’m not sure whether it is more efficient than other ways,” he admits. “Advertising in the right environment, understanding the fans and giving them corresponding offers has a significant uptick in terms of performance – that again is logical.” 

The road ahead 

If current trends continue, the dominance of player props will only grow. “Operators like parlays; margins are better for a start,” Danzer notes. “And this is where player props are interesting.” 

With the convergence of technology, personalisation, and fan behaviour, the future of sports betting may lie not in the final score, but in who scores it, how, and when. 

A primary concern for operators and legal experts is the proliferation of the black market as players seek out frictionless products that don’t require deposit limits or affordability checks, as the legal sector does.

But these measures are only expected to continue, as the government prepares an update to the gambling laws, which it says will seek to better protect players than the previous version. In February, State Secretary for Legal Protection Teun Struycken said a new gambling bill was expected by the end of the year.

This, he suggested, could include measures like increasing the age limit for higher-risk products like online slots.

Market experts expect the jurisdiction may hit a turning point and lawmakers will pull back on the restrictive approach, once they realise increasing measures are damaging legal offerings.

Could lawmakers U-turn on strict measures?

“If and when the black market really starts to take over, I think the government may then start to look at relaxing certain laws. The problem with politicians though is always the same. They start rescue action when the victim has already drowned,” Justin Franssen, co-founder and head of law firm Franssen Tolboom, told iGB at iGB Live in London in July.

July figures from regulator Kansspelautoriteit (KSA) reported a 93% channelisation rate in the Netherlands. But in terms of total number of bets, research from H2 Gambling Capital showed the market is split 50-50 between legal and illegal operators, based on a total market size of €2.10 billion.

This figure paints a bleak picture of both the current situation in the Netherlands and its immediate future. And by 2030, H2 has forecast that regulated online operators will make up €1.21 billion of gross revenue, giving the legal sector just a 45% market share.

Regulatory changes like player deposit limits and increased tax contributions for operators have also led to high-profile exits from the market by LiveScore Bet and Flutter-owned Tombola last year.

At the time LiveScore said the market was “no longer viable commercially” for the business.

Earlier this month, a ban on gambling sponsorship for sports clubs and competitions was also implemented. This was the last stage of a two-year strategy for additional marketing restrictions, following the ban of untargeted gambling advertising via most media channels in 2023 and the prohibition of programming and event sponsorship in 2024.

There could also potentially be a ban on online slots incoming, but this has not yet come to fruition despite being voted on in Parliament in 2024.

Rise of the black market

The black market issue is increasingly concerning for Dutch stakeholders, as it appears to be growing faster than in some other European markets.

Peter Rampertaap, coordinator operational supervision for the KSA, has warned that player education on which products are legal versus illegal is needed.

Speaking during an iGB Live panel session, he said: “Not every player knows the difference between a legal operator and an illegal operator. Our research particularly showed that young people struggle to tell the difference. When the illegal operator doesn’t have to pay tax, you can see why it’s a profitable business.”

The KSA said earlier this month that deposit limits had resulted in average monthly losses among players falling 31%. However there has been a rise in consumers searching for the top 100 illegal gambling websites in the Netherlands, further supporting claims that the black market is thriving.

How did we get here?

The opening of the market was impaired by a long and stretched out political process. The Remote Gaming Act was first proposed in 2014, then adopted by the Dutch Lower House in 2016, but the market launched five years later.

Government restrictions are seen partially as the result of a heavy quantity of marketing from operators upon the market’s opening. It began with 10 legal online licensees, but this has since expanded to 27 licensees, with 22 current active websites.

Speaking at iGB Live, Mike de Graaff of BetComply, used the Netherlands as an example of how regulated markets can get things wrong.

“People should be treating the market as an opportunity and not as a cash grab,” he warned.

“In the Netherlands, there was finally a regulated market with a pretty clear playing field. But then the market participants come in, aggressively compete for market share and they complain when more rules are made, saying that the black market is thriving.”

Franssen agrees: “When the market opened, operators didn’t hold back. The bombardment of advertising led to public opinion turning against operators and [caused] a tremendous backlash politically. This is all the result of an industry which doesn’t learn from mistakes made in other jurisdictions.

“Before the market was regulated, [prominent operators] were broadly tolerated by the public. Gambling was not as negatively perceived as it is now. I think the public perception of gambling is now very similar to alcohol and tobacco,” he adds.

A missed opportunity for Netherlands legal gambling

Two of the market’s original licensees are owned by the state; land-based casino Holland Casino and state lottery Nederlandse Loterij.

There is an argument the government could have utilised its position as an investor in these brands to ensure stricter self-regulation which could have prevented further restrictions.

“[The state-owned operators] were number one and two in terms of marketing spend. They should have been the guiding lights [for other operators] but they weren’t,” comments Franssen.

“The great irony is those two brands were government-owned and the government then created their own political backlash. They had more direct influence on themselves than anything [the private operators] could do.”

Political uncertainty makes for unclear future

So where can the Dutch gambling market go from here? Political instability in the Netherlands is not helping the situation. On 3 June, the Dutch government collapsed when Geert Wilders, leader of the far-right Party for Freedom, withdrew from a four-party coalition, leading to a snap election set for 29 October.

“The political situation certainly makes a difference,” Franssen admits. “Teun Struycken is very anti-gambling. His party, the New Social Contract Party, previously announced plans to abolish online gambling in their manifesto.”

After the election, the Netherlands legal gambling industry may find that politicians seek to relax restrictions to improve the market’s long-term position.

“We need to create regulated markets that enable licensed operators to be creative and innovative. By having super restrictive markets that you cannot really flourish in, it makes it very difficult for operators to bring any innovation to the market,” De Graaf advised during his panel session.

 “There are fewer listed companies, and the companies that remain are of lower value,” says Ivor Jones, equity analyst for Peel Hunt. This rate of departure has accelerated further recently, with the London Stock Exchange (LSE) now estimated to account for just 3% of the global equity market.

According to Statista, in February this year just 1,660 companies were trading on the LSE, a number that saw it fail to make a list of the 10 largest exchanges in a 2025 breakdown published by Visual Capitalist. Twenty years ago, the figure stood at 2,916. 

“The UK is a small market and a small share of total equity value, and that has put pressure on valuations,” Jones notes.

“UK investors have been seeing higher interest rates available if they’ve got cash to invest, or higher interest rates making their mortgage more expensive. They’ve been selling UK equity, and they’ve been turning it into something else. So there’s been a constant outflow.” 

What’s happening with UK public equity investment?

UK fund managers have been selling off domestic public equity holdings in response to investors redeeming their money and this has contributed to valuations remaining low. 

The gaming sector has largely mirrored wider public market shrinkage, with consolidation leading to fewer listed names over time. Notably, Betfair Group was delisted from the LSE in 2016 after merging with Paddy Power, and GVC absorbed Ladbrokes Coral, after the two merged in 2017.  

In the same year, 32Red was bought by Kindred Group and subsequently disappeared from the LSE. And then Evoke, known previously as 888, bought William Hill in 2021 resulting in yet another name leaving the London exchange.  

Jones believes this wave of consolidation-driven M&A by listed incumbents in the UK is largely behind us. “There’s still M&A happening to some extent along the fringes of the industry,” he says. “[Although] it’s hard to imagine Entain buying Evoke.” 

Private equity is another investment option

Jones points to private equity takeovers also driving consolidation. Although the UK has experienced less of this trend, in Europe, Blackstone, CVC and Apollo Global Management have dominated gaming deals and backed leading players like Superbet, Tipico and Lottomatica in Italy, over the last few years.  

“Private equity has been the default buyer of lots of businesses. When you look at a business like Evoke, for example, it has about €1.8 billion in debt. That’s not an impossible transaction for a large private equity firm to buy the whole business, refinance the debt and reinvest more aggressively to make the revenue grow faster and deliver the promised profitability more quickly,” says Jones.  

The PE trend in gaming has also been more prevalent in the US than the UK, with a handful of deals agreed in 2024, including Apollo acquiring suppliers IGT and Everi Holdings in a $6.3bn deal. 

Frank Fantini, founder of Fantini Research, puts the wave of US PE deals down to waning valuations across gaming stocks, as the sector struggles to reach the all-time highs experienced during the Covid-19 pandemic. 

Speaking to iGB’s sister publication GGB, he said, “Private equity firms can continue to move into [gaming] as they have the luxury of paying higher prices for acquisitions knowing they are free of impatient investors and can wait for their paydays.” 

Easing of regulatory pressures returning UK to growth 

The UK government’s decision to reform the 2005 Gambling Act rocked the industry, driving down revenue in 2021 and 2022 as operators grappled with the threat of much tighter regulations and prepared for the worst. The white paper’s release in 2023 caused another wave of panic as operators were faced with incoming affordability checks, deposit limits, online slot stakes and a statutory levy, to name a few.  

In H1 2024, 888 Holdings experienced a 25% year-on-year decline in UK revenue, which it put down to proactive player protection measures initiated during the period. The group subsequently said it soon expected to return to growth, but in April of this year it reported a 1% UK revenue decline as it continued to face pressures from incoming regulations.   

But player protection measures have been much softer than the white paper suggested, and operators are starting to see a slow return to growth, as the impact of these new regulations have already been absorbed. Entain hailed UK net gaming revenue growth of 22% in Q1.

This followed 13% growth across the UK&I business in Q4 2024 as the operator hailed an “earlier than expected” return to growth in the market.  

UK investors are becoming more optimistic

Entain CFO Rob Wood said the turnaround effort was powered by the group addressing frictions and complexity within its UK customers’ journeys. “Those drivers enabled the UK to return to market levels of growth in H2, which in turn helped all of Entain return to market growth,” he told analysts in March. “We’re therefore already on track to deliver our targets of market growth in 2025.” 

Entain’s CEO Stella David expects the group to seize UK market share from tier two and three competitors as, unlike Entain, they may struggle to absorb the costs of regulatory changes.  

According to Jones, UK investors are once again optimistic about the future of the sector, but today operators with predominantly regulated revenues are not as in demand as they once were. “There was definitely a period when companies thought investors wanted a high proportion of business to be regulated, because regulated was seen to equal low risk. But the UK is a good example of that not being the case,” he says. 

“That period of simply thinking regulated is superior to unregulated is gone. I think investors are more likely to make an informed view about where risk is, rather than see it through the lens of regulated or not regulated.” 

Evoke and Entain have also appeared more methodical in the way they communicate with shareholders, presenting a much more medium-term investment outlook and reiterating the underlying attractiveness of the business.  

Diversifying the revenue mix 

Mark Segal, CEO for London-listed games provider Gaming Realms, believes diversifying the company’s geographic portfolio to improve revenue streams has helped mitigate the impact of stagnation in the UK. “We have quite a diversified revenue or revenue exposure now, because it’s multiple operators in multiple markets [using our games] and we can retain a highly efficient focused cost base. So, we’ve been able to grow our revenue year-on-year,” he tells iGB.  

Gaming Realms started its life as a listed operator, with the Foxy Bingo brand under its umbrella. But on acquiring social games platform Slingo in 2015, the group pivoted to a pure-play B2B provider.

Segal says shareholders responded well to the company’s transition and new investment poured in. “It’s clear investors really like the B2B model. I think they find that very attractive and that’s where we are now.” 

Segal admits tightening regulations hit operators harder, while suppliers are somewhat shielded from the impact of heavy-handed player protection measures. Operators are more exposed to risk, he suggests, and that makes satisfying shareholders more difficult.  

Allure of US stock exchanges

With UK valuations impacted by the wider economic environment and outflows of public liquidity, some UK and European-listed companies have relocated to US exchanges, on the promise of better access to capital. The New York Stock Exchange (NYSE) is the biggest stock exchange globally with a market cap of $36 trillion, according to Statista, followed closely by Nasdaq, also based in New York.  

Shell, one of Europe’s most prominent oil and gas entities, floated the idea of switching its LSE listing to the US in 2024 as its American peers were experiencing much higher valuations. The company reiterated it was still reviewing this option in January, after its 2024 revenue declined 16% to $23.7 billion. 

Another recent example is Wise, a UK-listed fintech, which announced in June that it would shift its primary listing to the US. CEO Kristo Käärmann said the US listing would enable better access to the world’s deepest and most liquid capital market.  

US macroeconomic trends

US markets are rising, in response to some of the actions taken by President Donald Trump. And the online gaming sector is unlikely to be impacted by incoming tariffs, so it will remain buoyant against other sectors, which may be harder hit.  

iGaming giant Flutter moved its primary listing to the NYSE in January, from Euronext Dublin, but the group maintains a secondary listing in London. In Flutter’s case, the move made sense to leverage and further support its burgeoning FanDuel business, which in 2024 accounted for 41% of total group revenue. In making this move, Flutter showed it was all in on the US opportunity, and the operator subsequently absorbed its core UK and Ireland business into the wider international arm.  

“If you have a reasonable US exposure, then it makes sense to list on the US market nowadays… particularly if you view yourself as a high growth or tech company, the US market tends to value these a lot higher than the UK market,” says H2 Gaming Capital Managing Director Ed Birkin.  

Did Flutter make the right move?

Jones expects Flutter is eyeing an entry onto a prominent US index, like the S&P 500. Despite a broadly positive response to Flutter’s move, equity analysts warned the company in March against its “overreliance” on the US. iGaming and sports betting growth in the market has slowed as fewer states have gone online in the last year. No new iGaming states are expected to launch this year.  

In response to Flutter’s 2024 earnings, analysts Regulus Partners said in a note the operator’s increasing focus on the US “as the only recognised growth driver for the group” would likely add to the risk of black-market growth in Europe.   

“Organic growth will need to be topped up with good returns on investment of their strong free cash flow – and you’d assume they can get better returns on strategic M&A than they can with share buybacks,” H2 Gambling Capital’s Birkin added.   

Elsewhere, reports in May suggested UK-based private gaming group Bet365 was either eyeing a US IPO or a partial sale of its global business to a private equity firm. According to The Guardian, Bet365 conducted talks with US advisers and Wall Street banks earlier in the year.  

Reviewing Bet365’s options

Although the UK remains a core market for Bet365, it has lost market share to competitors in recent years as others have advanced their technical capabilities and presented comparable bet builder offerings. A US listing makes sense if it wants to achieve the highest valuation possible and lean into the success of its US business, which continues to grow, while many of its European peers are exiting the market. 

“With more trading liquidity, and the US market (and Americas in general) likely being their main growth opportunity going forward, this is a compelling story for US investors,” Birkin muses on the Stateside listing opportunity for Bet365. “A US IPO would give them a higher valuation and access to more capital than a UK listing.” 

But in Birkin’s view, private equity is a better option for the betting giant as, he says, “It allows time for a change in management – assuming current management want to step back – and to accelerate growth while still a private company ahead of a US listing at some point in the future.” 

The US SPAC attack 

In 2022, Betway’s parent company Super Group merged with US special purpose acquisition company (SPAC) Sports Entertainment Acquisition Corp (SEAC), resulting in its listing on NYSE in 2022.  

“The US as a listing venue is particularly attractive because of the sheer volume of capital available and the credibility assigned to US-listed businesses by investors, regulators and banks,” explains Super Group’s Investor Relations team.  

SPACs gained popularity among sports and betting groups in the early days of legal US sports betting. They provide a vehicle for accessing public equity more quickly than through a traditional IPO. DraftKings merged with a SPAC under the name Diamond Eagle Acquisition Corp in 2019, listing on the NASDAQ in early 2020. Since then, its share price has skyrocketed almost 95%. The operator has come out fighting as part of a duopoly alongside Flutter’s FanDuel, leading the US’ online betting and iGaming sectors.  

“The fact that the US market was liberalising at that point… added increased momentum among US investors who were then developing an appetite for iGaming stocks which wasn’t previously as prevalent,” says Super Group.  

Although the UK has long been a core market for Super Group, its Betway brand being synonymous with English Premier League football, the opportunity for a US-listing, and its partnership with SEAC, was too good to turn down.  

“We have benefitted [from the US listing] in many ways. Our profile has been raised with investors, who now understand our business and strategy better and recognise what makes us stand out. We’re also now more credible with regulators and banks than when we were privately held, and even our customers appreciate the clear message of strength and integrity that being a listed business gives us,” the IR team says of its success on the NYSE.  

LSE fights back 

Attempting to remedy some of the reputational damage LSE has experienced since companies started flocking to US exchanges, its parent company LSEG reported in March that London had a more geographically diverse investor base than the US. Data suggests US exchanges are supported by an 81% North American investor base, while LSE is propped up by 41% North American and 31% UK-based shareholders. European investors account for 15% of the LSE and 9% of US exchanges.

According to data collected between 2019 and 2024, meanwhile, barriers to entry for the UK are lower than the US, as LSE IPO fees are almost 1% below NYSE fees – and 2.5% lower than Nasdaq.  

“Flutter, Ferguson, CRH and Abcam are four companies that switched from a UK primary listing to a US primary listing in recent years,” an LSE Group note stated.  

“Of these, while they may have seen a small initial increase in EV/EBITDA and P/E ratios following the addition of the US listing, any improvements have largely reverted after switching to a ‘primary’ US listing. When comparing to US-listed peers, any valuation gaps have not significantly changed upon addition of a US listing.  

“Movements seen in discounts or premiums to peers have largely been moderate, suggesting any changes in valuation are due to industry trends rather than the change in listing.”  

Tax burden for UK listed operators

Although UK incumbents are starting to see green shoots after a difficult period, the market could be facing additional pressures from a government review of the current remote gambling tax model, which sees betting taxed at 15% of operator profits and iGaming at 21%.

Stakeholders are worried the government could increase remote betting tax to come in line with iGaming under a new consolidated structure, and that would likely hit operators quite hard. An update on the process is expected in the Autumn Budget.  

The market is increasingly being compared to Germany and the Netherlands, where player restrictions and increased tax rates are stifling the industry. Valuations and share prices in the UK reflect increasing market risks and ultimately, according to Jones, the UK is “feeling flattish”. 

“Equity investing is about evaluating risk and, most importantly, paying the right price for it,” he says. “Gaming has been disappointing in terms of the balance of risk, and that’s the best way to put it.” 

While the market’s remaining listed companies don’t look set to leave any time soon, methods to appease investors outside of improving UK performance are becoming more common, including diversifying their geographic reach, while reasons to remain listed in the UK are becoming less so.  

Canadian Gaming Association CEO Paul Burns recently said of the Canadian market: “Because of the large unregulated iGaming market presence in Canada, no one’s had a monopoly for 25 years, and that’s the reality.” 

The same can be said for Europe’s remaining monopolies, including Veikkaus. Finland has operated a thriving grey market for the last five to 10 years, and Veikkaus has unsurprisingly struggled to keep up with unlicensed peers that have not had to face the same restrictions as the monopoly.  

Not only has the operator faced highly innovative competition, but new player protection measures implemented in a 2022 update of the Lotteries Act in Finland also resulted in Veikkaus’ revenue taking a hit in H1 2024.  

“The visible decline in the purchasing power of consumers has affected Veikkaus’ business,” Group Managing Director Olli Sarekoski said in its first half 2024 earnings report. “Our number of customers is still at a good level, but the amount of money played by customers is average.” Active players increased by 15,000 during the three-month period to 2.5 million. 

Some close to the Finnish iGaming sector have suggested the government pushed through its gambling reform last summer to revive the suffering monopoly business. And Veikkaus is broadly optimistic it can complete this turnaround successfully. Sarekoski admitted in the earnings report that the operator was aiming to take a leading position in the competitive market.  

Welcoming a new leader 

The overhaul commenced with the hiring of iGaming EVP Jarkko Nordlund in September 2023. Nordlund has an extensive background in consumer entertainment, having spent years leading and advising the Finnish arms of television, music and streaming services like MTV, Universal Music and Canal Plus. Nordlund was undoubtably brought on as Veikkaus’ secret weapon, to build out a sufficiently competitive iGaming business.  

“I have a long background in the entertainment industry,” he explains. “For me, this industry is part of the same entertainment experience and entertainment wallet [as TV, music and streaming services].”  

Nordlund’s entrance to the business initiated a much broader overhaul of both the iGaming arm’s operations and tech and product offering.

Veikkaus VP Sports Betting Andreas Reimblad joined Veikkaus from Kindred in July 2024, tasked with building an updated betting product, sitting on the OpenBet platform.  

New sportsbook to drive Veikkaus’ iGaming arm

OpenBet won a tender process initiated by Veikkaus in September 2023 to source a new platform and managed trading services provider. Prior to this Veikkaus had used SBTech’s betting technology, but after it was acquired by DraftKings in 2020, the operator said it would wind down its B2B operations, in March 2021.   

“Our current supplier DraftKings announced they were not continuing with their B2B element. The development of the product has been far from ideal, when we’ve seen other operators being very quick in developing their product and platforms,” Reimblad says.   

“We recognise we wouldn’t have succeeded if we’d remained the same. We have had to make tangible changes to provide a better experience for the end consumer, because we’re not competing for the international operators’ [acknowledgement], we’re competing for the customers.” 

Alongside a new betting platform, the operator has opted to integrate new PAM and CRM platforms, as well as new apps and website frontends, which will launch in the coming weeks. The scope of the product refresh is massive. And Nordlund says it is his personal mission to ensure Veikkaus succeeds in the open market.  

“Everyone is waiting for Veikkaus to fail,” he says. “The competition will be fierce when the market opens, so we must be very competitive. Our aim is to challenge the mentality of our current position, so we need to secure market leadership.” 

‘We are the market’ for local sports 

On the sports side, Reimblad insists there is much more than just a platform change powering Veikkaus’ sportsbook transformation. For a number of years the operator has had an in-house trading team to price local sports like ice hockey, floorball and Finland’s answers to baseball, pesäpallo.  

Properly integrating and utilising this team is a core goal for Reimblad. “A big reason why we’ve used OpenBet is that we wanted those self-trading capabilities, as we really see it as a unique possibility for us. We can create markets and a product that no one else in the market can, with the accuracy that we can.”  

Generating these in-house odds will be a core part of Veikkaus’ competitive advantage, Reimblad says.   

“For some of the international operators, Finland will be a quite small market overall. So, this is one element that we can really stand out on. It’s not many that have their own local trading team who are actually doing the odds compiling for the market. I would even state that we are the market in some of the local sports.” 

Historically, Reimblad says Veikkaus has operated a high-margin betting product, and to improve the consumer’s overall betting experience, his team has been working to increase the player playback rate. “It’s not a secret that monopolies come with a history of low paybacks, and it’s been one way for the international operators to take market share. We have now started to be even more aggressive.” 

Payback rate is the percentage a player gets back for every euro they bet. Veikkaus has been slowly increasing that rate to improve the overall offering and, Reimblad says, to improve the product’s perception. Profitability has improved since this target was set by Reimblad last year.  

Leveraging the historic Veikkaus brand 

Nordlund says the transformation really commenced in January of last year. Part of the process is deciding how to leverage Veikkaus’ legacy brand in Finland, which is synonymous with both lottery and physical slot machines. Nordlund is wary that although brand recognition among consumers is assured, he is worried Veikkaus’ monopoly past could tarnish its new product.  

“Our brand is super strong, it’s domestic and reliable. But then we have to also be more entertaining [than we have been]. The negative side of the coin is because it’s a state-owned monopoly, the consumer might believe we can’t offer competitive odds,” he admits. “We are most concentrating now to the consumer experience and making that better, and that will be then powered by the brand.” 

Speaking to iGB in September 2024, local lawyer Antti Koivula and ex-Veikkaus executive Jari Vähänen said they expected Veikkaus to benefit against independent operators from its vast brand exposure. After all, Veikkaus slot machines are even found in local supermarkets.  

Does Veikkaus have a competitive advantage?

One key question raised by stakeholders in response to the government’s draft gambling bill last summer was whether Veikkaus would maintain any competitive advantages to independent operators, particularly in leveraging its decades-old player database and cross-selling users onto the new product suite.  

When Sweden liberalised its online gambling market in 2019, the monopoly Svenska Spel’s new licensed business was granted access to its historical database, but under the condition that players had to opt in to receiving cross-sell messaging. Veikkaus has been operating iGaming for some years and so has already built up a player base that would not need to be cross-sold from its land-based or lottery players.  

Nordlund says it is not yet clear what the rules for Veikkaus will be on this, as the sector awaits the final gambling bill. This was widely expected to be approved by parliament ahead of the Scandinavian midsummer holiday. 

“The operators in Finland need more details on it, but it looks like everyone may be able bring our customer base with us and keep on operating with them,” Nordlund notes. “But how do we define what the customer base is? [Is it players that have been active] within half a year to a year? These type of operational details needs to be clarified.”  

Sourcing the right talent 

The final component to Veikkaus’ transformation is, of course, talent acquisition. Nordlund recently poached a former colleague of Reimblad, Fatemeh Daneshzadeh, ex-product excellence manager for Kindred. Daneshzadeh joined Veikkaus in April as VP of digital channels.    

Nordlund says that although he is looking to recruit further experienced industry folk, he is also looking at other entertainment sectors where the experience could mirror that of iGaming. “We have hand-picked international expertise [from the sector] to come to work for us. Then we are recruiting from Netflix, Bolt and those [kinds of] digital companies,” he says.   

The business will ultimately maintain a mix of legacy Veikkaus staffers and new talent, which will encompass all the best parts of the entertainment industry. 

For Reimblad, he says Kindred’s transition into an FDJ company after the operator was acquired by the French giant meant his time at the company had reached a natural end. He was looking for a new experience and, once he’d met Nordlund, he realised what a fantastic leader he was.  

“He puts a lot of challenges on you and pressure, but he’s a fantastic mentor and he has all these ideas about wanting me to have the freedom to execute things how I like. That was a big reason for me. It was [also] all about the timing,” he recalls.  

A Swede among Finns

As a Swede, joining a Finnish company was a challenge initially, but Nordlund insists the company is becoming broadly more international and this is a deliberate effort to entice industry expertise from hubs like Malta. The company language is now English, Nordlund explains. 

“I’ve found some really strong local candidates and also met a lot of Finnish people living abroad and working with other gaming companies that might want to move back in the future. I think people really see us as a strong operator in Finland,” Reimblad says.  

Nordlund expects the wholesome work-life balance culture in Finland will attract talent over to Veikkaus. He praises Helsinki for its good schools and insists it is an easy commute to and from the office.  

With the transformation at Veikkaus well and truly under way, the operator expects to return to growth by next year. “We need to be more exciting, more entertaining, [and offer a] better consumer experience,” Nordlund concludes. Reflecting on the competition, Reimblad points out that while Finland is only a small focus for many of the independent operators, for Veikkaus, this market is its entire revenue. With that in mind, it’s certainly got a good shot at taking the lead.  

But in a Q3 gambling activity update from the Gambling Commission, player data suggested these prize draw offerings could be cannibalising traditional lotteries in the UK. “We’ve seen the growth of large-scale prize draws and that growth has been very significant,” Gambling Commission CEO Andrew Rhodes told attendees of the Betting and Gaming Council’s AGM on 27 February.  

He noted that prize draw products are experiencing a participation level that is much higher than that of other gambling products, or products regulated as gambling. “It’s getting close to being on a par with betting in terms of participation, also in terms of the average spending,” Rhodes said. 

Should prize draws be regulated alongside lottery? 

The UK Lotteries Council, a body that represents the sector, has called for a re-evaluation of the currently largely unregulated prize draw vertical. It should fall under traditional lottery regulations, it says. “If there is a shift from society lotteries to unregulated prize draws, returns to good causes will inevitably decline.  

Million-pound prize draws represent the thin end of the wedge in lottery-based civil society fundraising,” Lotteries Council chair Tony Vick wrote in a March report on prize draws and charity lotteries. But James Miéville, executive director at Raffle House, a prize draw operator in the UK, says he does not believe the product is in competition with the National Lottery, as it is instead an entirely new demographic of players.  

“We believe companies such as ours have tapped into a previously unmet demand and that this has attracted new players rather than pulling players away from other products,” says Miéville. “Our player data suggests the audience for house prize draws is more diverse than that of lotteries.”  

‘Free to enter’

Today, prize draws offer a “free to enter” option, whereby players can send in an entry to a draw, only paying to send the entry. This means the vertical is exempt from falling under lottery rules as per the Lotteries Act. Also writing in the Lotteries Council report, Member of Parliament for Aldridge-Brownhills Wendy Morton warned these new games had become “indistinguishable” from charity lotteries, which are required to meet strict standards, like not offering large prizes or jackpots and paying back a certain percentage of earnings to charity.

The case against prize draws, which are typically offering multimillion-pound prizes to players, is clear: they should be properly regulated, so the traditional lottery sector claims. 

In a speech to parliament last week, Gambling Minister Baroness Twycross said the vertical would not be placed under the Lottery Act regulations but rather a voluntary code which will seek to unify the vertical’s approach across the sector. 

Richard Williams, partner at Keystone Law, told iGB he expects a monitoring period of at least a year for prize draws, to assess whether any measures are successful. He said the code was largely an attempt to avoid introducing legislation. 

Healthy competition 

Others in the lottery sector support the innovation behind the new vertical; after all, it is clearly appealing to a new demographic that more traditional lotteries have ignored for decades. Could this feud be exactly what lotteries need to reinvigorate the industry? 

“I get the impression that some players in the industry are trying to fight the competition through politics here, and I would say that’s not wise,” Helmut Becker, longstanding CEO for German lottery provider Zeal Network, tells iGB.

“They should focus on innovation in their own business. I do think generally speaking there’s an opportunity for more innovation in our industry.” Becker laments the slow uptake of online lottery offerings. “The internet penetration in the lottery industry is relatively low, particularly in Germany where we are at 25%,” he says.  

He goes on to compare the sector to other entertainment offerings like concerts, or even transportation services that offer tickets online for trains and buses. “Those industries have much higher rates of digital penetration. I see tremendous growth potential in the lottery industry converting from offline to online. There’s this continuous optimisation in ecommerce best practice [that we could learn from].”  

We’ve seen this response before 

Zeal rode the wave of lottery betting (or lottery brokerage) solutions as the novel opportunity arose in 1999.

Operators like Zeal and Lottoland offered players a chance to participate in mammoth jackpots, by betting on lottery draws around the world instead of just their national or state-run offering. In the beginning of this wave, operators were heavily scrutinised and many called for new regulations to clamp down on the spread of these types of offerings, similar to the fight against prize draws today.  

But Becker argues there is a need among younger and female demographics for new and novel solutions within lotteries. “There are new target groups, other target groups than the traditional lottery player, younger target groups, female target groups. And there are ways to address the needs of those target groups and that’s through product innovation. Creating new types of lotteries or new types of games like Dream House raffle, for example, unlocks another layer of growth [for operators],” he says. 

Zeal has both invested in and developed an in-house version of a prize draw offering but offered under a charity lottery licence, and Becker suggests it is this agility and commitment to innovation that has powered Zeal’s progressive growth in recent years. 

In its full-year 2024 results, Zeal posted a record group revenue of €188.2 million ($203 million), beating the previous year by 62.2%. It also saw bottom-line net profit rise 333.2% to €59.4 million. On this trajectory, Becker says the company has continuously optimised and grown its core business while making constant improvements in ecommerce, ensuring excellence in unit economics, efficiently allocating marketing spend and ultimately improving the customer lifetime value of its loyal customer base. There is clearly still demand for more traditional lottery betting offerings.  

Can it cross-sell? 

In the US, lottery courier services have exploded in the market. These offerings enable players to participate in draws operating in multiple states by buying tickets for different draws and enabling players to purchase them via the product. In February, DraftKings CEO Jason Robins talked up its 2024 acquisition of lottery betting app Jackpocket, insisting the product was already proving a valuable customer acquisition and cross-sell tool. 

 “Jackpocket has been great in terms of both cross-sell and, also, we have had really strong customer acquisition during its last $1 billion jackpot run. I do think that there’s room to invest more there,” Robins told analysts in its Q1 earnings call.  

“For us, it’s probably more effective in states where there’s legal sports betting and iGaming because the LTVs (lifetime value) in the immediate term are going to be higher because we can cross-sell right away.” 

He compared the product to DFS in terms of player acquisition opportunity, and of course it was DFS that helped skyrocket the likes of DraftKings and FanDuel to the top positions for both betting and iGaming in the States. But Becker says he is less certain of lottery’s cross-sell capabilities.  

“The jury is out on how big the synergies between different forms of gambling are, and whether it is possible to capture them and how,” he comments. “I haven’t seen the data yet, so for me the case is not closed on the cross-sell opportunity between lottery players and other forms of gambling being as big as expected.” 

Lottery and iGaming

Nikolina Gabelica, head of lottery operations at EveryMatrix, supports Robins’ assertion that lottery games can be successful acquisition tools. “I worked for an operator previously, and it had a clear path to use lottery as an acquisition tool. It’s easier to acquire a player, but not to say it’s cheaper, with lottery games. And that’s including instant games and scratchcards. Yes, this is easier, less frequent and less aggressive play. But it was used for acquisition of the players,” she says. 

“Of course, not all lottery players would transition to sports betting or iGaming. But yes, that journey was a natural one [for players].” However she acknowledges that gamified lottery products offering unique bonuses or a novel element prompt longer gaming sessions and a higher chance for cross-sell capabilities. 

Lottery across the pond 

The US is operating a dynamic and nuanced lottery sector, but like other verticals it is fragmented and many states still have a state-run lottery monopoly in place. Therefore, regulations are hugely outdated and largely do not support new multistate courier operations like Jackpocket. The vertical came under fire in February when a group of investors won two multimillion-dollar jackpots in Texas, after mass purchasing of tickets in bulk, which effectively hacked the system. 

The scandal resulted in harsh criticism around the lottery courier offering, and Texas moved to ban these services in the state. According to 2024 data from the Office of Program Policy Analysis and Government Accountability, lottery betting was available in 19 US states last year. 

“I think the US lotteries are concerned about it because they are finding themselves competing directly with very mighty private companies that are active in sports betting and iGaming,” Becker explains. “But I honestly don’t know how the US market will play out. I think it will be two steps forward, one step back. I think it will be very heterogeneous and be different in each state.  

“Oftentimes there’s no clear regulation for online sales. The courier model evolved because there is demand and somebody is just filling the gap. I think the problem is that there’s no good regulation in place to foster the well-regulated sales of online lottery tickets to customers.” 

Robust regulation is crucial

Becker believes that, in order to maintain a thriving and innovative lottery sector, robust regulation is needed. And this is something that appears to be missing in the US. Germany, however, has robust lottery laws in place, he says. And having these laws in place has supported and encouraged the rise of new products and fresh innovations.  

He says the gambling regulator in Germany, the GGL, has determined clear boundaries for the lottery sector and this makes it easy for lottery brokerage operators like Zeal to adhere to the rules. “A well-regulated market fosters and incentivises good behaviour and growth. In the end, society benefits from that growth. I do think there’s an opportunity to strike a balance between a well-regulated and open market that is open to private players like us.” 

Many European markets also still operate lottery monopolies while others, like the UK and Italy, issue a tender for their national lottery. This is either won by a single lottery provider or a consortium of providers.  

All change for lottery in the UK 

In February 2024, global lottery provider Allwyn won the UK’s National Lottery tender, after almost 20 years of Camelot operating the programme. In securing the fourth licence, Allwyn saw off competition from a number of heavy hitters, including Camelot. However, the operator, which counts a number of European lottery companies under its belt, has faced criticism for failing to deliver on promises made during its successful bid for the lottery.  

Areas of concern to the Gambling Commission are said to include delays to digital upgrades. Allwyn is also said to have pledged to reduce ticket prices for the main National Lottery draw from £2 to £1, but this is yet to take place. In a statement issued to iGB, Allwyn said it is still committed to upgrading and modernising the system, with a planned spend of more than £350 million ($467 million) on improvements.  

“Our investment will help restore the magic to The National Lottery,” Allwyn said. “But the shift from outdated systems is complex and requires robust testing. We will deliver essential upgrades over the coming year. We are working at pace to complete this transformation as soon as possible.” 

Can lottery keep up with prize draw innovation?

Allwyn shows it is harder to innovate in a legacy sector than some might believe. The outlook for lottery is positive. Becker believes there is much more to be achieved in the space, particularly in increasing the rate of digitisation. The demand for new lottery-style games will continue to grow as Gens Z and Alpha turn the appropriate age for playing these games. But national lotteries are certainly at risk of falling behind. 

“They’re setting a new standard for how play should feel,” Gabelica says of the “quick, easy experiences” of sweepstakes, crypto games and prize draws. “This is very difficult for lotteries to catch up [to]. And the risk is that if [these new games] change what players expect, and if the national lotteries don’t keep up, they will feel outdated, even if the prizes are much bigger,” she concludes.

Understandably, operators are shocked and likely reconsidering their positions in the newly regulated market.  

“[Operators] don’t want to be investing in a country they agreed to pay BRL30 million [to enter]. They agreed to invest hundreds of millions into this venture and then six months down the road they just change the rules of the game without asking you,” Eduardo Ludmer, BetMGM’s head of legal in Brazil, tells iGB.  

Gambling trade bodies ANJL and IBJR banded together and condemned the government’s provisional measure as “unacceptable” when it was announced earlier in June.  

“If Brazil goes in this direction, it’s just showing a message that rules can be changed at any time here,” Fernando Vieira, executive director of the Brazilian Institute of Responsible Gaming, adds. “It’s not reasonable to come and start to change everything after only five months. 

“It will send a message to the world that Brazil is a complicated place for doing business. There’s no legal certainty in Brazil for the business.” 

What is the government suggesting? 

In June, the Brazilian government enacted a provisional measure to raise the tax rate as part of a broader effort to cut the government’s deficit.  

It relates to upcoming proposed changes to Brazil’s tax system, set out in May, which would have seen a sharp increase to the financial transactions tax (IOF), raising the rate from 0.38% to 3.5%. 

The IOF applies to a range of foreign transactions including loans, currency exchange, insurance and investments. It remains a major source of federal tax revenue. 

However, the proposal faced backlash from Congress, prompting the government to revise the decree almost immediately. 

President Lula’s administration remains under pressure to reduce Brazil’s fiscal deficit by the end of 2025, ahead of next year’s presidential election.  

Therefore, the government has turned its attention to the betting industry to help cover the BRL20 billion ($3.6 billion) shortfall left by the IOF decree’s failure. 

This has come as a huge shock to the sector, especially the timing, with less than six months having passed since Brazil’s licensed online sector went live on 1 January. 

Ludmer tells iGB his company’s finance team will have to recalculate their forecasts to include the abrupt tax rise. 

“Everybody was very surprised with the increase, because you prepare yourself, you buy a BRL30 million licence, you have a business plan based on a 12% tax rate,” Ludmer says. 

This could have huge repercussions for the licensed sector, which suffered another blow recently when the Senate approved new ad restrictions, such as watersheds across TV and radio.

ANJL President Plínio Lemos Jorge warns the tax rise will impact ongoing requests for licences, with Brazil potentially losing out on BRL2.8 billion in revenue should operators decide to give up on entering the regulated market. 

Legal uncertainty caused by tax hike the key point 

Ludmer is concerned sudden changes like the tax rise will ultimately undermine investor confidence in the regulation, making Brazil appear as “not a serious country”. 

The sector is still awaiting the outcome of a Supreme Federal Court hearing to establish whether its betting laws breach Brazil’s Constitution.

This hearing was called after the National Confederation of Trade in Goods, Services and Tourism (CNC), Brazil’s third biggest trade union, filed an ADI (Ação Direta de Inconstitucionalidade), a legal action in Brazil that aims to overturn a law that acts against the nation’s Constitution.

“For me, this [legal certainty] is the pillar for everything to succeed,” Ludmer continues. “It’s one of the most important aspects to doing business, not only in Brazil, but everywhere.” 

“Imagine you have the Supreme Court that is slated to declare or not the legality of betting, of the whole industry we are working in, where we are making investments in the billions, hiring like crazy. And it could be the case that this whole thing can have a huge setback. It’s crazy to imagine that.” 

Vieira agrees the inevitable legal uncertainty has the potential to set back Brazil’s nascent licensed sector. 

Ludmer explains this rise is to be paid alongside a range of other taxes, such as income and municipal taxes, pushing the total burden on operators close to 50%. 

“Operators have said it’s prohibitive in terms of business to have 18%,” Ludmer says. “We want this country to thrive and we understand that an industry can help contribute to that, so creating jobs, paying reasonable taxes based a on predetermined rate that we agreed upon, that should not be varied.” 

Illegal market again a key concern in Brazil 

Lemos Jorge agrees with Ludmer’s warning the tax rise is prohibitive to operators and he says it will be much harder for licensed companies to remain profitable.

Authorised operators may opt to exit the licensed market, with consumers then pushed towards the black market. 

The IBJR has already predicted the market share of illegal operators could jump from the already concerning 50% up to 60%. 

“The only way operators will be sustainable in Brazil is to increase the channelisation level and, for that, the fight against the illicit market becomes even more important,” Vieira explains.  

These illegal operators don’t comply with responsible gambling measures or pay taxes and, in Ludmer’s view, lax enforcement is allowing such companies to continue their activities without fear of punitive backlash, as well as payment providers who work with black market sites. 

Notably, Anatel, the national telecom regulator, which is tasked with blocking illegal sites in Brazil, is reportedly running out of funds needed to continue its enforcement efforts against the black market.  

“We have criminals doing criminal activities without having any enforcement,” Ludmer says. “They need to pay a very heavy fine.  

“If we see the Central Bank imposing a very heavy fine on these payment providers, then we’re going to see these illegal operators being scared, because nobody’s scared currently.  

“If you act with impunity and you’re earning billions of dollars without paying any tax, without hiring any local employees, without contributing to the economy, and you have no sanctions, you keep on doing that, unless you apply the sanctions.” 

Industry needs to educate Brazil lawmakers on tax hike

There is still hope for the betting industry that this tax could ultimately be scrapped. Local news outlet Valor reported Hugo Motta, the Chamber of Deputies speaker, has stated the provisional measure is unlikely to be approved in its current form.  

This time prior to such a vote occurring is therefore crucial for the gambling sector to make its point, educating the politicians on the economic benefits of the betting and, perhaps most importantly, why such a measure could foster black market growth. 

The ANJL has sent a technical report to the presidents of the Senate and the Chamber of Deputies, listing all the consequences for the betting sector should the tax rise be made permanent.

The report also points to other markets where abrupt changes without prior analysis have compromised the competitiveness of the licensed sector, thus boosting the black market. 

The IBJR has also launched a study that found if the government turned its attention to reducing the illegal market by 10%, the additional revenue would cover the funds they are expecting to gain from raising the tax. 

Brazil government’s lack of understanding

One key issue is the lack of understanding from the government of the betting sector, Vieira laments. He notes the average member of parliament has a “very low understanding and knowledge” of the sector’s regulation. 

“Education is a fundamental piece of the answer for the problems that we’re facing in Brazil,” Vieira adds. “One front is education from the stakeholders in Congress and some of them in the government to understand that we have already a good set of rules in place.  

“And the other part of education which is needed is educating the consumer, because we saw in our research that most bettors find difficulties in distinguishing a legal operator from an unregulated operator.” 

This duty also falls upon operators, Ludmer says. “We have a responsibility here as a big company as well to educate the market. Our main campaign now is on responsible gaming.” 

IBJR and ANJL join forces

Some in the industry have previously lamented the fragmented representation of the sector, with five major trade associations representing betting in Brazil. 

However, the two biggest, the ANJL and IBJR, signed a cooperation agreement in June, aiming to strengthen their efforts against overregulation in Brazil. Combined, the bodies claim to represent over 90% of the regulated sector. 

In Vieira’s view this is a step in the right direction, especially when tackling problems that risk jeopardising the entire sector. 

“It means that we will together fight the illicit trade and to guarantee sustainable conditions for the market and increase the channelisation in Brazil, the objective for the whole sector,” Vieira says. 

“It is time, more than ever, for unity,” Lemos Jorge agrees. “We have a common agenda, which is the viability of the regulated betting market.  

“We are facing a great challenge, because over-taxation compromises the activity of the sector and drives the growth of illegal websites, which already represent the vast majority of bets operating in the country.” 

Confidence the tax hike won’t be made permanent 

Ludmer is optimistic the tax will not be converted into law. Similarly, Lemos Jorge is hopeful the Congress will see sense and realise just how harmful the rise could prove to be. 

“We are confident in the dialogue with the authorities,” Lemos Jorge concludes. “The regulated market pays its taxes, generates revenue for governments and enables the creation of thousands of jobs.  

“Now is the time to focus on and improve a sector of the economy that will not regress and that can make significant contributions to the expansion of public policies.” 

Even if the policy isn’t converted, however, the threat of it is a harsh reminder of the unpredictability in Brazil. This approach is what also delayed the launch of the legal sector and helped encourage black market proliferation.  

Now more than ever, operators like BetMGM and the two major trade bodies need to get on the same page and ensure the momentum of the licensed betting sector isn’t harmed.  

The deficiencies stem from a comprehensive sports betting scandal. Several illegal bookmakers admitted to using casinos as an avenue for laundering millions of dollars in ill-gotten funds.

North of the border in Canada, which adopted single-event sports betting in 2021, leading provinces such as Ontario have done an admirable job in convincing grey market operators to transition to the regulated market. However, the issue in many respects remains a major concern.

In response, the gaming industry is pushing for an overhaul of the nation’s AML standards, many of which it describes as outdated, as technological advances available to nefarious actors progress more rapidly than monitoring capabilities.

At last week’s Canadian Gaming Summit in Toronto, the issue represented one of the most popular subjects of the two-day event. The summit hosted multiple panels in Toronto on methods that need to be employed to modernise the nation’s AML framework. Improvements have been made in strengthening AML controls throughout the nation’s land-based casinos, but panellists emphasised more work needs to be done on the online gaming side.

“We need to understand that in a modern, digital economy, we need to develop policies and regulations that are appropriate to fit the risk profile,” Canadian Gaming Association President Paul Burns told iGB last week on the sidelines of the conference.

Forthcoming FATF review

The summit took place several months before Canada will host the Financial Action Task Force in November for an in-depth review. Headquartered in Paris, the FATF is one of the world’s foremost global money laundering and terrorist financing watchdogs.

The initiative is the first collaboration between the FATF and Canada in nearly a decade, since a 2016 mutual evaluation report issued by the task force.

In the 216-page report, the FATF noted that businesses that handle large volumes of cash are “highly vulnerable” to money laundering and terrorist financing operations as the activities are attractive to those who launder drug proceeds.

The FATF identified brick-and-mortar casinos as among the businesses which exhibited vulnerabilities to laundering activity. Indeed, the 2022 Cullen Commission report highlighted significant evidence of money laundering in British Columbia, with money flowing from China through underground banks and into real estate via casinos.

Two key recommendations, namely establishing a special AML investigation unit and creating an independent commissioner, have not yet been adopted, the Vancouver Sun noted in May.

Although the FATF gave the retail casino industry high marks for understanding the risks involved, the watchdog identified online casino operations as an area with an emerging risk profile.

A panel on 19 June featured Kevin de Bruyckere, an official who serves as director of AML and investigations for the British Columbia Lottery Corporation. During his onstage remarks, the director cited a January study from FINTRAC, the nation’s financial intelligence unit on AML matters.

Are fentanyl traffickers using iGaming to launder money?

De Bruyckere called attention to findings which indicate that online gaming platforms and payment providers are possibly being used in laundering proceeds from fentanyl trafficking and production. In addition, the director has urged the Canadian government to provide federal financing in preparation for the FATF review.

FINTRAC referenced a litany of suspicious transaction reports which showed that known fentanyl traffickers “frequently” sent funds from money transfer sites to online gambling operators. In turn, the individuals received payouts from associated payment processors in Canada, Malta and the UK, according to the report.

Moreover, FINTRAC suspects the individuals withdrew winnings from the online gambling sites after using the platforms to disguise funds from opioid trafficking. In some cases, various transactions appear as an e-transfer from a processor, instead of an online gaming transaction. The scheme enables traffickers to bypass certain reporting obligations had they transacted with a financial institution.

De Bruyckere has largely been pleased with information-sharing initiatives in British Columbia which enable law enforcement to receive alerts in real time. Nationwide, however, there are signs that Canada lags behind other G20 countries with info-sharing cooperatives on money laundering.

Among the deficiencies identified by the FATF nine years ago, the task force detected weaknesses in Canada’s info-sharing apparatus for policing money laundering.

Since then, the weaknesses have also been spotted in a 2018 Parliamentary review of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and a subsequent analysis of the nation’s AML framework two years later.

The ‘biggest’ haystack possible

As the opioid crisis continues to proliferate, Canada has proposed sweeping changes to its AML regime. Under Bill C-2, penalties for non-compliance could be increased considerably on individuals to a cap of $4 million.

For corporations, the penalties would also rise significantly to a ceiling of $20 million. While the Canadian parliament tabled the bill earlier this month, aspects of the proposed legislation could be implemented before year’s end.

FINTRAC is still reeling from a pernicious cyber breach last March that took its systems offline for nearly a year. Over that period, there are indications that Ontario gaming operators had to submit approximately 70,000 AML reports on a manual basis. For its part, FINTRAC claimed it maintained the integrity and security of its systems during the monthslong breach.

Nevertheless, the cyber hack raises critical questions of whether the nation’s AML apparatus needs to be modernised. Burns, the president of the CGA, notes that Canadian operators report on overall transactions, while counterparts in the US and the UK report narrowly on suspicious activities.

By one measure, the Canadian Bankers Association determined that nationwide entities submit roughly 96 times more reports associated with money laundering in comparison with banks in the UK. As Burns puts it, Canada builds the “biggest haystack possible” in addressing the issues.

Canada’s AML laws: Stuck in the past?

There are other areas for potential improvement. Derek Ramm, global head of advisory services at Kinectify, wrote a lengthy article ahead of the summit articulating why he believes that some of Canada’s AML laws are stuck in the past. At present, Canadian law contains a narrow definition of casinos, he explains.

As a result, he told iGB that some wagers on a sports betting kiosk may not trigger an AML requirement. In many cases, the same bet placed online must be reported to conform with AML obligations.

“These gaps create confusion, compliance challenges and, worst of all, vulnerabilities that could be exploited by bad actors,” Ramm wrote in the piece.

Ramm appeared on a panel on 18 June that discussed the necessity of overhauling the operational effectiveness of Canada’s AML regime.

Ahead of the FATF review, none of the panelists have a crystal ball. Still, many of them are losing patience. Consider the description of Ramm’s panel in the summit agenda:

“The industry requires improvements in information sharing and performance metrics that prioritise outcomes rather than outputs in combating money laundering, as the current system is inadequate. Or to put it plainly: what we have now isn’t working.”

And a mere six months into the nascent market’s existence it has become an easy target for plugging budgetary gaps, as President Lula insists sectors like gambling do not pay enough in state contributions. 

At the time of the announcement, on 3 June, Brazil’s gambling trade bodies had denounced the proposed policy, warning it could spur black market growth.  

The policy change seems straightforward in that the gambling tax rate will increase from 12% to 18% of GGR for all operators, but the reasoning behind the change is complex and the process for the policy to be enacted is shrouded in even more uncertainty

João Rafael Gandara, tax lawyer at Brazilian firm Pinheiro Neto Advogados, tells iGB the policy may not even pass, as it must be enacted within 60 days of the Senate issuing the bill. It can be extended by another 60 days, so 120 days in total.  

He also believes the sector could leverage the Congress’ recent pushback against broad tax hikes in the country.

How did we get here?  

The government hinted at changes in the country’s taxation system in late May, when it announced controversial plans to raise the rate of financial transactions tax (IOF) from 0.38% to 3.5%.

The IOF was introduced in Brazil as a monetary policy by the government, to help control financial markets. IOF must be paid on foreign transactions such as loans, foreign exchange, insurance and investments. It is a significant contributor to the government’s tax revenue. 

Almost immediately the move faced pressure from the Congress and the government quickly scrapped the decree to raise the IOF rate. 

But the current government, led by President Lula, has plans to decrease Brazil’s deficit significantly by the end of 2025, ahead of an election next year. So instead of increasing the IOF, it has turned to the betting sector to help fill a BRL20 billion gap. Other sectors like agriculture are also facing tax hikes to help balance the budget.  

Tax hike enforced within 90 days, but could be revoked by Congress 

Gandara believes the policy could end up being scrapped if the provisional measures are not approved by Congress within a 120-day window. However, despite it not having been formally voted on by Congress, the provisional measure took immediate legal effect in June. The increased tax rate will be implemented 90 days after the decree was published. This means if the measure isn’t made permanent after 120 days, any taxes taken from the 90-day mark onwards must be returned to operators. 

Gandara cites recent examples of Congress swiftly rejecting provisional measures, which could provide some hope for the gambling sector after the hugely negative response to the tax increase and a generally negative perception of the government’s tax policies.  

“We had a recent precedent within the last year where the president of the Congress immediately returned [a policy], saying ‘this has no chance of going [through] and I won’t even start the legal proceedings, so we will immediately reject [this provisional measure].’ 

“And you normally have that when he has the majority of Congress backing him. That was the [outcome] the last time we had this type of problem.” 

The policy in question was a provisional measure that limited companies’ ability to use tax credits and extinguished cash reimbursements of presumed credits. 

Positive signs for the betting sector 

Last week, the Chamber of Deputies gave urgent status to a bill that would overturn the effects of the government’s IOF decree. This means it won’t go through any parliamentary committees before being voted upon. 

This is a fresh indicator the Congress does not support the government’s tax increase efforts to try and reduce its deficit. 

Gandara agrees the government is going the wrong way about eliminating the deficit, by targeting a “clearly overtaxed” gambling sector, which he believes is an “easy target” due to its current negative reputation.

“I think across the whole world, like in the US and Europe, governments are cutting expenses,” Gandara explains. “The other [option] is to raise taxes. 

“The government needs to cut from expenses and they know it’s a hard discussion [to have], so they avoid it and they are really targeting whomever they can. [Gambling is a] new industry and they’re getting a regular income, they’re not the villains of the story.” 

Gandara says taxation is a particularly contested topic in Brazil, which continues to dominate national headlines while elsewhere, US President Trump and conflicts in the Middle East are making up the headlines. 

As the government’s tax raising policy is so controversial, Gandara feels an effectively formulated response from the gambling sector could overthrow the provisional policy. 

“[Taxes] are really a hot topic and I think the government will have a very hard time [convincing] the Congress,” he adds.  

“So maybe if there is a really well organised strategy, explaining to the Congress that this type of taxation can really harm the [sector] and wider government strategy, maybe they can get the policy rejected.” 

Excessive taxation will push companies out

Gandara cites the Laffer Curve, a widely known graph that shows if a tax rate is raised too high, the funds collected start to drop off as companies either leave the country or consumers turn to illegitimate offerings to avoid paying more for a product or service.  

“There’s an optimal point,” Gandara says. “If you push [beyond] that, you are no longer collecting taxes because either companies have left the country, or everyone is in the black market.” 

“What the government should be doing is the opposite, presenting a reasonable tax so they have this optimal collection and you have other companies coming [into the market],” he concludes.  

A large swath of state attorneys general have joined Ohio AG Dave Yost in pushing an appellate court to overturn a ruling on the legality of prediction markets in New Jersey.

Yost and nearly three dozen state attorneys filed an amicus brief on Tuesday urging the US Court of Appeals for the Third Circuit to side with New Jersey in a legal battle with Kalshi. Amid the contentious battle, questions remain on whether a provision in the Commodity Exchange Act allows the federal government to preempt state regulations on sports wagering when the betting propositions are offered through event contracts.

While Kalshi is partnering with third-party providers to establish anti-money laundering safeguards for its platform, event contracts are not currently taxed on the state level.

“States rightfully have the ability to protect their citizens through the negative consequences of online gaming no matter how it’s packaged,” said Yost in a statement. “We’re protecting the unprotected.”

Yost has been joined by a number of prominent states on the East Coast, including New York, Pennsylvania, Connecticut and Massachusetts. The brief also gained support from a number of states throughout the Midwest such as Illinois, Indiana, Iowa, Michigan and Minnesota.

Kalshi CEO Tarek Mansour has levied criticism toward state attorneys general for attempts to restrict event contracts on sports. Mansour supports regulation of prediction markets on the federal level through the US Commodity Futures Trading Commission. Earlier this week, the Third Circuit granted Kalshi a 14-day extension until 24 July to file a brief in response to New Jersey’s opening brief.

Penn meeting largely uneventful amid HG Vora lawsuit

For a gambling-industry event as hyped as any shareholders’ gathering since the historic PASPA decision, Penn Entertainment’s annual shareholder meeting on Tuesday largely failed to bring the sizzle.

As expected, Penn shareholders elected Johnny Hartnett and Carlos Ruisanchez to the gaming company’s board of directors as part of a continued reshuffling of the board. Their additions were sought by HG Vora Capital Management, a top Penn shareholder.

But Penn did not consider the nomination of William Clifford, a third independent director sought by HG Vora. Clifford’s nomination represents a key sticking point in contentious discussions regarding the future composition of the board.

At the conclusion of the 10-minute, 30-second meeting, Penn CEO Jay Snowden announced the election of Hartnett and Ruisanchez, based on the preliminary results of the vote. But without a resolution to Clifford’s nomination, the brief meeting ended on an anti-climactic note. As a court hearing in HG Vora’s lawsuit against Penn over board seats approaches next month, the meeting arguably produced more questions than answers.

Resolution to come from court system

In May, HG Vora filed a lawsuit against Penn accusing the company of violating Pennsylvania Business Corporation law. The suit also accuses Penn of breaching its fiduciary duty by reducing the number of seats available on the board. In response, Penn filed a motion to stay, urging a Pennsylvania court to temporarily halt legal proceedings. According to Penn, the merits of HG Vora’s claim do not “constitute good cause”.

In addition, Penn argued that the plaintiffs have not established likelihood of “imminent and irreparable harm”. There, Penn addressed HG Vora’s arguments on board composition. Speculation about a future board action cannot constitute “good cause”, Penn contends. A speculative matter is not even a dispute ripe for adjudication, Penn added, because it rests upon contingent future events that may not occur as anticipated, or may not occur at all.

Penn also criticised HG Vora for its failure to abide by disclosure standards in other instances. The Securities and Exchange Commission announced a $950,000 settlement with the fund in March 2024 for its failure to make timely ownership disclosures in the lead-up to a May 2022 acquisition bid for trucking fleet company Ryder System Inc.

According to the SEC, HG Vora disclosed that it owned 5.6% of Ryder’s common stock as of 31 December 2021 and certified that it did not have a control purpose. The fund subsequently built its position to a 9.9% stake in the first half of 2022 and formed a control purpose in May of that year. However, HG Vora did not make the proper disclosures until 13 May 2022, the same day it made a proposal to buy all of Ryder’s shares for $86 a share, a sizeable premium over the trading price.

DraftKings, Underdog submit licensing applications in Mizzou

As Missouri nears a fourth-quarter launch of legal sports betting, a pair of operators have secured a jump on the competition in meeting their licensing obligations.

Two sportsbooks, DraftKings and Underdog, have submitted licensing applications with the state, the Missouri Gaming Commission confirmed. As of Friday, the companies are the only two operators that have turned in the requisite filings, according to the MGC. The story was first reported this week by Legal Sports Report.

FanDuel, DraftKings’ archrival, will almost certainly submit an application before the deadline imposed by the MGC. In total, FanDuel and DraftKings spent more than $40 million in support of a ballot measure advocating for the legalisation of sports wagering.

There are several pathways to attaining licensure in the Show-Me-State. The most immediate deadline falls on 15 July when applications for so-called untethered licences are due. The MGC will award those licences by 15 August. In addition, another classification of licence applications will face a submission deadline of 12 September.

Operators have the option of gaining market access through partnerships with professional sports teams. Already, Bet365 has inked a partnership with the St Louis Cardinals of MLB. Century Casinos has also named BetMGM as its sports betting partner.

Missouri is on track to go live with sports betting by 1 December. Days later, the Kansas City Chiefs will appear in primetime on Sunday Night Football. The Chiefs are seeking their fourth straight AFC Championship.

AML modernisation dominates Canadian Gaming Summit

A who’s who of regulators, legislators and C-suite executives converged upon Toronto this week for the annual Canadian Gaming Summit. Luminaries such as Ontario Lottery and Gaming Corporation CEO Duncan Hannay, Ontario Attorney General Doug Downey and Ontario Alcohol and Gaming Commission Chair Dave Forestell all made appearances at the event.

Since the launch of the Ontario iGaming market about three years ago, provincial regulators have received high marks for facilitating the transition of grey market operators. By some estimates, about 80% of such operators have moved over to the legal market. Nevertheless, Downey appears to be losing patience with some of the stragglers.

“The market’s matured enough now that people have had an opportunity and, if they’re not going to go through the door, it’s time that they stop playing in our market,” said Downey in a fireside chat.

Another hot topic at the event centred on the nation’s anti-money laundering framework, one the gaming industry views as largely outdated. Last year, a comprehensive cyber breach identified in March forced the Financial Transactions and Report Analysis Centre of Canada (FINTRAC) to shut down an AML portal for months.

The hack created exposure for thousands of files in the gaming industry, multiple sources told iGB at the summit. For its part, FINTRAC claimed the centre took every precaution to maintain the integrity and security of its system in an effort to assuage the industry.

Now as the industry pushes for modernisation in AML processes, experts are clamouring for a push toward automised reporting. The breach leaves some queasy on if the security guardrails are robust enough. At a panel on Thursday, several speakers expressed concern that Canada will receive a negative rating when the Financial Action Task Force reviews the national AML infrastructure this November.

ICYMI on iGB

VGW, other sweeps confront tough week as US regulators crack down

NJ sets online gambling revenue record for the month of May

Michigan online gambling revenue tops $300 mil in May

NY board finalises licence fee, capital minimum for downstate casino bids

Louisiana governor vetoes anti-sweeps bill

Pennsylvania gambling revenue clears $600 million in May

Tribes wade into prediction market debate with amicus brief

Ippei Mizuhara, Ohtani’s ex-interpreter, finally reports to prison

As expected, Penn shareholders elected Johnny Hartnett and Carlos Ruisanchez to the gaming company’s board of directors as part of a continued reshuffling of the board. Their additions were sought by HG Vora Capital Management, a top Penn shareholder.

But Penn did not consider the nomination of William Clifford, a third independent director sought by HG Vora. Clifford’s nomination represents a key sticking point in contentious discussions regarding the future composition of the board.

At the conclusion of the 10-minute, 30-second meeting, Penn CEO Jay Snowden announced the election of Hartnett and Ruisanchez, based on the preliminary results of the vote. But without a resolution to Clifford’s nomination, the brief meeting ended on an anti-climactic note. As a court hearing in HG Vora’s lawsuit against Penn over board seats approaches next month, the meeting arguably produced more questions than answers.

Penn: Nomination of Clifford ‘out of order’

Speaking on behalf of HG Vora, a New York-headquartered hedge fund, Mandy Lamb put forth Clifford’s nomination at Tuesday’s meeting. Clifford has deep experience with Penn, where he formerly served as the company’s chief financial officer for nearly 13 years. He left the company in November 2013, seven years before Snowden’s appointment as CEO, to join Gaming Leisure and Properties.

Snowden abruptly dismissed Lamb’s proposal, immediately quashing any possibility for the election of a third director. Pursuant to Penn company bylaws, the board set the number of Class II directors at two, Snowden stated. He deemed a proposal to nominate a third director as “out of order” and not permissible.

The proxy battle on board composition has been the subject of an intense months-long dispute between Penn and the hedge fund. Since his departure, Clifford subsequently interviewed with Penn for a position on the board in 2020.

Penn indicated that it still has some of the same concerns on Clifford’s expertise in digital gambling that it raised five years ago. In a May letter to shareholders, Penn asserted that Clifford lacked digital gaming and online sports betting experience, areas that are “essential to the future” of its business.

Federal lawsuit

In May, HG Vora filed a lawsuit against Penn accusing the company of violating Pennsylvania Business Corporation law. The suit also accuses Penn of breaching its fiduciary duty by reducing the number of seats available on the board. In response, Penn filed a motion to stay, urging a Pennsylvania court to temporarily halt legal proceedings. According to Penn, the merits of HG Vora’s claim do not “constitute good cause”.

In addition, Penn argued that the plaintiffs have not established likelihood of “imminent and irreparable harm”. There, Penn addressed HG Vora’s arguments on board composition. Speculation about a future board action cannot constitute “good cause”, Penn contends. A speculative matter is not even a dispute ripe for adjudication, Penn added, because it rests upon contingent future events that may not occur as anticipated, or may not occur at all.

Penn also criticised HG Vora for its failure to abide by disclosure standards in other instances. The Securities and Exchange Commission announced a $950,000 settlement with the fund in March 2024 for its failure to make timely ownership disclosures in the lead-up to a May 2022 acquisition bid for trucking fleet company Ryder System Inc.

According to the SEC, HG Vora disclosed that it owned 5.6% of Ryder’s common stock as of 31 December 2021 and certified that it did not have a control purpose. The fund subsequently built its position to a 9.9% stake in the first half of 2022 and formed a control purpose in May of that year. However, HG Vora did not make the proper disclosures until 13 May 2022, the same day it made a proposal to buy all of Ryder’s shares for $86 a share, a sizeable premium over the trading price.

HG Vora trots out the Gold card

Ahead of Tuesday’s meeting, HG Vora urged shareholders to vote using its “gold card,” which featured the nominations of all three directors. By noon on Tuesday, more than 55% of all votes cast in the election were submitted on the gold cards, HG Vora wrote in a statement.

At the same time, HG Vora claimed that approximately five of Penn’s top 30 institutional investors voted on the company’s white proxy card, based on preliminary tabulations from the fund’s proxy solicitor, Okapi Partners.

“Penn’s shareholders have voted overwhelmingly for genuine change, including for the election of William Clifford to the board,” said Parag Vora, founder of HG Vora. “There can be no mistake about the mandate from Penn’s shareholders that the status quo is simply unacceptable.”

Institutional ownership

The nasty proxy battle may serve as an example for major sportsbook operators on how to handle disputes from activist investors. In a memo issued by Penn Entertainment last month, the company claimed that HG Vora violated several institutional investor waivers in which they agreed to remain passive in their activities. Furthermore, Penn asserted that the fund pushed for governance changes despite express prohibitions on doing so by state gaming regulators.

For its part, the hedge fund retorted that it does not consider itself to be an activist investor. To buttress its point, attorneys for HG Vora wrote in the suit that the Penn nominations marked the first time in the 16-year history of the fund that it nominated director candidates for a company in its portfolio. Over that span, HG Vora has invested in hundreds of firms.

In a Schedule 13D filing with the SEC issued on 28 December 2023, HG Vora disclosed an ownership stake of approximately 9.6% of Penn’s outstanding common stock. By the following December, representatives for the fund appeared in Massachusetts for a licensing hearing. According to the lawsuit, HG Vora contends that it sought an emergency hearing with the Massachusetts Gaming Commission (MGC) in order to obtain a gaming licence or limited relief in Massachusetts to be in a position to nominate candidates to the Penn board.

Reduced holdings

After the MGC denied HG Vora’s request for relief, the fund decided to shave its holdings in Penn for licensing purposes. Weeks later, HG Vora disclosed in a 13D filing that the fund reduced its ownership in the company’s common stock by approximately half to 7.25 million shares, representing an equity stake at the time of 4.8%.

According to TipRanks.com, a leading market research website, there is considerable institutional ownership in Penn, with 86.7% of shares held by institutional investors.

Beyond HG Vora, three others maintain a stake of at least 4%, led by iShares which tops the list at 11.4%.

Speaking on the sidelines of Wednesday’s Canadian Gaming Summit, Canadian Gaming Association CEO Paul Burns told iGB that the gaming industry is “in a fascinating spot” at the moment. He was responding to a question on how the Penn matter can become a template for other proxy battles throughout the industry.

One avenue to explore surrounds the mix of private equity investment. As Burns points out, the shift could be interesting since the private equity community maintained a relatively low appetite for sportsbook operators before PASPA.

Investment into digital gaming

Before Penn’s foray into online sports betting, HG Vora lauded the company for its execution on the retail gaming side. The fund pointed to Penn’s financial results in the second quarter of 2015, a period where Penn delivered a strong balance sheet favourable by industry standards in terms of net debt leverage and interest coverage.

Its criticism, however, centres on Penn’s spending habits in growing its digital gaming business. Penn is in the middle of a 10-year, $1.5 billion deal with the Walt Disney Co that led to the launch of ESPN BET.

The August 2023 partnership was announced on the same day that Penn sold Barstool Sports back to Dave Portnoy for $1. In total, Penn had spent in excess of $400 million to purchase Barstool.

A major purchase, eh?

With the Disney deal, Penn essentially swapped Barstool Sportsbook for ESPN BET as its front-facing sportsbook brand. At the time, Snowden had ambitions to hit 20% online sports betting market share by the end of 2027. But as the two-year anniversary of the deal nears, ESPN BET’s nationwide market share still hovers in the low single digits. The deal also came on the heels of Penn’s acquisition of Score Media and Gaming Inc for approximately $2.1 billion.

TheScore, a digital media, sports betting and technology company, is one of the most popular sports apps in Canada. At Wednesday’s conference, Burns gave theScore high marks for its tech platform.

Others, though, have questioned the cost of the Score acquisition, considering other subsequent deals such as Fanatics purchasing PointsBet’s US assets for $150 million. An industry tech consultant speaking to iGB on condition of anonymity this week believes Penn could have waited for valuations to moderate, noting that “timing is half of everything”.

An inflection point?

In attempts to grow its online business, Penn may spend at least $4 billion, HG Vora estimates. Both Penn and ESPN have an opt-out at the end of the third year, which Snowden noted could be exercised by either company if they believe ESPN BET has underperformed. HG Vora has advised Penn to abandon its online division. Based on comments from Snowden on a recent earnings call, such a move appears to be a longshot at best.

“Our digital business continues to evolve, supported by our well-known brand-differentiated IP, a fully owned technology stack and newly recruited, industry-leading talent,” said Snowden on Penn’s first-quarter earnings call. “We are nearing an inflection point.”

Penn is also bullish on a new initiative that enables customers to link their accounts between ESPN BET and the main ESPN app. The features combined with the rollout of ESPN’s new streaming service have Penn Chief Technology Officer Aaron Laberge intrigued by the “bespoke integrations” he said will be unique to the market. ESPN BET will look to the football season to provide customers with new personalised offerings that integrate their sports betting and fantasy sports selections with a quick thumbprint.

Despite Penn’s financial challenges, it is important to remember that top gambling names are valued in many cases as Software-as-a-Service (SaaS) stocks. Stocks in the class are long-dated, high-growth companies in the tech sector. Amazon, for instance, took years to first turn a profit. Nevertheless, questions remain if investors such as HG Vora will exercise enough patience before attempting to execute major change.

Executive compensation

For HG Vora, executive compensation is a major point of contention. In April 2021, Penn’s board awarded Snowden supplemental equity grants worth nearly $200 million keyed to certain price targets, according to HG Vora. Those grants have incentivised Penn’s attempts to grow Penn’s digital business without exercising enough financial restraint, the fund contends.

Snowden’s compensation of $26.7 million in 2024 ranked second-highest for CEOs among a group of approximately a dozen peer companies, according to HG Vora. Penn, however, disputed some of the findings.

Snowden’s realisable pay represents only 45% of his reported compensation and is in the bottom quartile relative to the company’s proxy peer group, the company wrote in the memo. Snowden has only exercised expiring options and has not sold any stock since 2021. Moreover, the transactions were only conducted to cover the strike price and taxes, according to Penn.

Next steps

Since 2020, Penn executives and directors have purchased over $5.7 million worth of stock in the open market using their personal funds, including $2.8 million by Snowden. Of the amount, Snowden made $1.5 million in purchases over the last 10 months, according to Penn.

The insider activity may not assuage the fund. In 2024, the Institutional Shareholder Services gave Penn a score of -100 on its “Pay-For-Performance” evaluation, a comparatively low rating that reflects high pay for low performance, according to HG Vora.

Meanwhile, share advisory service Glass, Lewis & Co gave Penn low marks for compensation levels relative to performance against its peers. More than 60% of the votes cast in the election were against Penn’s Say-On-Pay proposal, according to HG Vora.

Penn did not respond to a request from iGB for comment.

On 10 July at the federal courthouse in Easton, Pennsylvania, Penn and HG Vora have a case management conference scheduled in the fund’s lawsuit.

On Nasdaq on Wednesday, Penn closed at $17.28 a share, up nearly 5% on the session. Shares in Penn are down sharply since hitting an all-time high of $142 in March 2021

But the uptake to competitive iGaming across the whole of Canada has been slow. The majority of the eight other provinces maintain state-funded online gaming or lottery offerings, similar to the Scandinavian monopoly model – although in the Nordics, Norway is the only remaining market to have not liberalised online gambling.

The model has long been criticised by industry trade bodies in the Nordics and, in the last year, politicians in Norway have also called for an end to the gambling monopoly. A prominent complaint is the unfair competitive advantage afforded to monopoly operators, as well as a lack of competitive options for consumers.

But perhaps the more pressing issue is the proliferation of unlicensed gambling operators and the lack of consumer protection within a monopoly market.

Paul Burns, president and CEO of the Canadian Gaming Association, believes the black market’s rise has been so prominent in Canada, the monopoly model no longer exists. “Because of the large unregulated market presence in Canada, no one’s had a monopoly for 25 years and that’s the reality,” he laments. Burns has been vocal about his wishes for other provincial governments to follow in Ontario’s footsteps.

“Canadians have gone to online sites for a decade or more and had access to all kinds of products and choice,” Burns says. “The monopoly model no longer exists. What we’re saying as a trade body is the provincial governments have the tools [to regulate].”

Canada iGaming is already mature

The Canada Gaming Association has urged remaining unregulated provinces to act and follow in the footsteps of Ontario and Alberta. “There’s this whole discussion going on around sweepstakes and predictive markets in North America and it’s like, the next thing’s already here and there’s more coming,” Burns warns. “As a regulator, there’s no time to pause anymore.”

Of the remaining provinces which do not provide regulated iGaming, Burns says the majority operate a legacy lottery regulator model with a lottery monopoly present. British Columbia, like Alberta, has an iGaming monopoly, offering table games, poker, bingo, slots and lottery tickets.

Burns says some of these provinces are still operating on an agreement made with the federal government in the 1980s giving the local governments jurisdiction over their gambling laws. But the developments in Ontario, and more recently Alberta, have piqued the interest of other provinces.

Burns says a number are analysing the framework adopted by Ontario, and British Columbia and Quebec are actively in conversations with the Canada Gaming Association on the possibility of regulating iGaming in their markets.

Looking back at Canada’s historic grey market iGaming adoption, Burns says the country was blessed with ideal foundational elements for the sector. This included high penetration of high-speed internet in the 2000s, a high adoption rate for mobile devices and the use of electronic banking systems throughout that post-millennium period.

“Canadians gravitated to offshore sites and were happy to play because they were available to them and offered them products they wanted and most people didn’t know the difference,” Burns says of the thriving grey market. For a long time, European incumbents like Kindred and Bet365 operated successful products in the country.

Ontario’s successes 

But after the 2018 repeal of PASPA in the US, Canadians took heed of the progressive adoption of online betting and gaming across the United States. For Ontario, the market was already mature when regulation was introduced.

“By the time Ontario opened, there was this built-in marketplace of customers with customer preferences, that was already evolving with brands,” Burns explains. “It’s always been a healthy gaming market, but by bringing the online space out of the unregulated, into a regulated regime, we were able to see what that market looked like.”

Ontario’s healthy 32% revenue gains in 2024 are a nod to the regulated market’s success. In its second full year of operation, the sector reaped $2.3 billion in revenue, not including its state-supported iGaming Ontario platform. The province is the most populous in Canada, with almost 16 million residents.

When looking at the US, and the huge iGaming market in New Jersey, Ontario reaped over two thirds of New Jersey’s $2.39 billion in iGaming revenue in 2024. Notably, New Jersey switched iGaming on in 2013, nine years prior to Ontario.

“There is a strong marketplace in Ontario and it’s continuing to evolve,” Burns says. He nods to the “strong responsible gaming and advertising rules” in place and insists that, while a few brands dominate the market, there is room for others to take market share.

Canada iGaming market leaders

BetMGM is one operator that has previously claimed to hold a 22% share of the market. Speaking during its Q1 earnings call, BetMGM CEO Adam Greenblatt told analysts the company’s share had increased and it remained the iGaming leader in the region.

Greenblatt was particularly optimistic about the omnichannel opportunity in soon-to-launch Alberta, as he expects BetMGM to replicate its success in Ontario.

“[We’re] particularly excited for Alberta, which looks to still be on track for a Q1 [2026] launch for both sports betting and iGaming. That should be a province where BetMGM really does flex its muscles, given the strength of our business in Ontario,” he said.

Learnings from the East 

Unsurprisingly, Alberta has sought to replicate much of the framework from Ontario, particularly its ability to attract leading players from the grey market. “One of the things Ontario did (well) was building a market that invited the grey market operators and made it advantageous for them to join,” says Burns.

“Alberta is clearly leading with strong measures of consumer protection. It’s this balance of being prepared to invest heavily in protecting your market and making it advantageous for people to join the regulated market. Ontario set a good bar, but we’re asking them to improve on that regulatory regime.”

Burns says his trade body has fought for a number of policies to be updated, based on what’s been learned during Ontario’s first two years of operation. These include streamlining technical reporting measures, which currently must be submitted to two different government entities. After all, Burns notes, compliance costs matter in competitive markets.

“What it means for the PlayAlberta platform is that, just like in Finland, they’re just going to compete naturally with the other private companies, and that’s a choice they must make. So, Ontario was a great example.”

Healthy competition

But where Alberta differs from Finland is its state-run PlayAlberta site continues to grow. In the 2023-24 fiscal year, the platform recorded $170 million in net sales, a 22% uptick on the previous year. But Burns believes the product represents up to 20% of the current market, meaning the remaining 80% is dominated by the black market.

Ultimately, the platform has been unable to compete with the burgeoning grey market. The monopoly story is a familiar one. A state-run operator chugs along for many years with an average product, but when the promise of an open and regulated market emerges, it buckles down and overhauls its product to fight for a fair share of the open market.

In May, Jarkko Nordlund, EVP for iGaming and sports betting at Finland’s monopoly Veikkaus, told iGB the operator was modernising its entire product suite and back-end services, including transitioning to new betting, PAM and CRM platforms. The market will open to private operators in January 2027.

“Everyone is waiting for Veikkaus to fail. And it’s my personal mission to prove everyone wrong,” Nordlund said.

“We have not really activated [our technology and product capabilities], but the competition is fierce and when the market opens we must be very competitive. Our aim is to challenge the mentality of our current position.”

More work for PlayAlberta

PlayAlberta has already leaned in and enhanced the volume of products available on its site, says Burns. And similarly to Veikkaus, the operator is expecting to leverage its strong brand reputation in the province to drive acquisition.

“It’s a choice provincial governments must make: Do they let their gambling organisation invest? Because it will require investment.”

In April, Ontario estimated it was operating a channelisation rate of 84%, although the province’s regulator and the Alcohol and Gaming Commission of Ontario found that 20.2% of those playing on regulated sites are also still engaging with the unregulated market.

There is clearly still more work to do.

Having achieved an 84% channelisation rate in two and a half years is a positive trajectory, but leakage of players to the illegal market could be in part due to the restrictions on bonusing and promotional marketing by licensed operators in Ontario. Players actively looking for a good welcome bonus deal might be enticed over to the black market.

Alberta has yet to finalise many of the specifics around advertising and player regulations. Following the third and final reading of the iGaming bill in Parliament on 7 May, the law was approved.

Minister of Service and Red Tape Reduction Dale Nally said during the session that consumer protection measures would be determined once the bill was passed, to ensure flexibility and so the regulator could adapt to the changing nature of consumer behaviors. He indicated the regulated market would launch in Q1 2026.

The impact of US tariffs on Canada iGaming

While advancements in gaming are largely positive in Canada, the sector is grappling with the mounting threat of incoming US tariffs, as announced by President Donald Trump in February.

In a note published on 1 February, the White House said to curb the flow of drugs and immigrants into the US from Canada, it would impose a 25% additional tariff on imports from Canada. In retaliation, the Alberta Gaming Liquor and Cannabis Commission suspended the purchasing of all US gaming terminals on 6 March.

The regulator called for all slot machines, video lottery terminals and other machines to be bought from companies with support services in Alberta, or from countries with whom Canada has a free trade agreement. The suspension was lifted earlier this month as some of the initial tariff tensions eased.

“It’s been an emotional debate in Canada because of the way President Trump has chosen to portray the relationship between Canada and the United States in the absence of facts,” Burns laments. He says up to 70% of the gaming machines sold in Canada are being acquired via agencies belonging to the provincial governments. Land-based operators have a deal in place with the local government for the use of gaming machines.

“This impact is real for governments in the province, but also provinces are changing their procurement policies and [fighting back].” This could force a change in the model used by operators. Many will undoubtedly seek to procure local supplies going forward.

Looking beyond the US

And Canada is unlikely to bow out of a trade war with the US, as politicians have indicated the country is happy to move away from its reliance on its neighbour to the south, particularly following Trump’s suggestion that the country would be better off as a US state.

The impact is being felt more broadly by gaming providers with business in the US. The topic of tariffs was flagged in a number of supplier Q1 results, and analysts sought to understand how the sector is mitigating the fallout. Light & Wonder said it was looking to transport parts of its supply chain through Mexico to utilise the trade deal in place.

Overall, the future for regulating gambling is positive in Canada. And although provinces have been slow to adopt a competitive framework for iGaming, developments in Ontario and Alberta have prompted early-stage discussions among provincial regulators.

Days after a federal judge signed a landmark settlement that will pave the way for student athletes to receive direct compensation from their universities, the NCAA released data describing the level of harassment by bettors during its signature event this spring.

Over the course of March Madness, Signify AI analysed threat matrix coverage on more than a million social media posts that mentioned players, coaches and officials participating in the tournament. NCAA President Charlie Baker lauded the project as a resource for athletes in dealing with perilous threats from bettors.

“One of the first things student-athletes told me when I became NCAA president was that they were being harassed online by people who are following or betting on their games,” said Baker in a statement. “From day one, it’s been a priority to study this issue, monitor the public interactions, protect student-athletes and allow them to focus on being students and competing at the highest level on the court with their teammates.”

During March Madness, Signify monitored the accounts of 2,032 players, 346 coaches, 136 teams and 269 game officials and selection committee members.

At the East Regional in Newark, Naismith Player of the Year Cooper Flagg told iGB that a number of his teammates had received angry messages on social media in response to lost wagers.

Decline in player harassment rates

Flagg, the presumptive No 1 pick in the NBA Draft, added that his former Duke teammates mostly just laughed off the threats.

In the 2024 NCAA tournament, former UNC centre Armando Bacot claimed to have received dozens of threatening DMs after missing the “over” on his rebound total, a game in which Bacot led the Tar Heels to an easy win.

While total abuse declined approximately 83% year-over-year, and betting-related abuse declined 66% on the women’s side, the results weren’t as encouraging for the men’s tournament.

On the men’s side, total abuse increased 140%, while abuse related to sports betting decreased 36%. Across all participants, abuse related to sports betting was down 23%.

Sports Betting Alliance adds Bet365

A popular nonprofit trade group has expanded by adding a high-level sportsbook operator.

On 10 June, the Sports Betting Alliance announced that Bet365 will become a member of the coalition, joining other prominent operators FanDuel, DraftKings, BetMGM and Fanatics. The SBA formed in 2021, about three years after the historic PASPA decision.

“Bet365 shares the SBA’s commitment to a regulated, transparent and sustainable US online gaming market. Together, we’ll continue fighting for more states to swap their dangerous and unregulated sports betting and iGaming products for regulated, consumer-protected legal platforms,” said Jeremy Kudon, president of the SBA.

Last year, a YouGov survey reported that US bettors aged 21-34 preferred Bet365 as their sportsbook of choice. The UK-headquartered Bet365 is operational in 13 US jurisdictions.

The SBA has garnered headlines recently for its criticism of a number of states for their tax policy on sports wagering. In particular, the SBA excoriated the Illinois Legislature for passing a last-minute tax increase on sportsbook handle that disproportionately penalises the largest operators in the market. FanDuel announced plans this week to impose a $0.50 surcharge on every bet made in the state starting in September, and DraftKings subsequently followed suit.

Last month, The Guardian reported that the Coates family, the owners of Bet365, sought advice from a host of US banks on a potential sale of the company. Such a move could have wide-ranging implications across the US sports betting ecosystem.

Louisiana senate passes bill on sports betting tax hike

A Louisiana bill that aims to raise the tax on sports wagering gross gaming revenues has made it to the desk of Governor Jeff Landry.

The Louisiana senate passed a bill on 8 June to increase the rate from 15.5% to 21.5%, which would bring tens of millions of dollars in additional revenue to state coffers. The bill passed overwhelmingly by a 35-3 vote. As of 1 June, the state generated $22.6 million in taxes from sports betting on revenue of about $180 million. Louisiana is among a bevy of states that have considered tax increases on sports betting this year.

Also this week, Churchill Downs Inc sent a letter to the Louisiana State Racing Commission informing the state that it has initiated plans to relinquish its licence for live racing at the Fair Grounds Race & Slots in New Orleans. Churchill is seeking legislative relief to offset the loss in revenue from legislative changes pertaining to historical horse racing.

“This is not the path CDI wishes to proceed down, but the inaction from elected officials to offer any sort of compromise has made this the only possible outcome…. Closing one of the nation’s oldest racetracks and the most important track in Louisiana, will be a devastating blow to Louisiana’s equine industry and the New Orleans economy,” Churchill Downs CEO Bill Carstanjen wrote in the letter.

Stitt: Tribes waiting for his departure to reintroduce sports betting

As expected, the Oklahoma legislative session ended without any resolution to bring sports wagering to the Sooner State.

Negotiations have become so heated between the parties that Governor Kevin Stitt believes the state’s leading tribal groups will now wait until he leaves office before resubmitting a proposal to legalise sports betting. Stitt vowed to veto any tribal-backed sports betting bill that made it to his desk this year. In light of his position, none of the bills passed during the session.

“We analysed the 30 or 40 states that actually have sportsbook and put a great plan together,” Stitt told the Tulsa World. “We set it out to have more of a free-market approach. As I’ve said before, I think the big casinos, the big bosses, are waiting until I’m out of office. So we’ll see what happens, I guess, in 2027.”

The impasse has deprived bettors statewide of wagering on the Oklahoma City Thunder during the NBA Finals. 

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Representatives from Apollo Global Management, International Game Technology and Everi Holdings went before the board to discuss Apollo’s $6.3 billion double acquisition of the two suppliers. This included numerous items related to ownership transfers, corporate protocols and compliance. 

Nick Khin, who currently serves as president of IGT, also appeared for suitability approval as interim CEO of the new entity. Former Aristocrat Gaming CEO Hector Fernandez will assume the role later this year upon completion of a non-compete obligation. 

The complex merger is still ongoing and will continue as Apollo navigates regulatory requirements in Nevada and elsewhere. But the state is the biggest in terms of influence and importance, as the new merged entity will be headquartered there. It was initially announced last July, but Wednesday was the first time officials gave new details about the transaction.

Ultimately, the board approved all the items unanimously, a significant step for one of the biggest industry deals in recent history. The Nevada Gaming Commission will now make a final ruling at its meeting on 26 June. 

A growing gaming portfolio

Apollo is merging IGT’s gaming business with Everi’s gaming and financial technology business. The new entity will be taken private while retaining the IGT name. IGT’s sizeable lottery business is being spun off into its own publicly traded company under a different brand.  

The firm has increasingly invested in the gaming industry over the last 20 years. This includes an ownership stint of supplier PlayAGS and current ownership of the Venetian-Palazzo casino on the Las Vegas Strip. New York-based Apollo paid $6.25 billion for the casino in 2022, nearly identical to that of the IGT-Everi acquisition.

Apollo partner Daniel Cohen went before the board to discuss the merger alongside attorney J Brin Gibson, who also notably served as chairman of the NGCB prior to Hendrick. Cohen asserted that his firm’s “sole focus is really to drive long-term value creation”, citing the success of its previous investments in the space.

“Our goal long term is to become the operator’s supplier,” Cohen told the board. “So if you’re the Venetian or Caesars or anyone else, you can come to IGT for basically every one of your product needs, which will allow us to continue to invest in products and innovate with our customers to really create the next generation of what casino technology products will look like.”

Closing the gap

IGT, one of the most storied brands in gaming, has seen two formidable competitors emerge over the years in Aristocrat and Light & Wonder. Aristocrat, by most accounts, has long held the top spot and L&W has been on a multi-year hot streak since divesting its own lottery and sports betting divisions. IGT could be considered third among them, with a widening gap.

Cohen acknowledged this on Wednesday, saying that the combined business “has a margin profile that is significantly lower than our largest peers, which, you obviously know, are Light & Wonder and Aristocrat”. He said Apollo will “look to close that gap under our ownership”.

On Monday, Fitch Ratings maintained Everi’s “BB-” long-term default rating and said it expects the new entity to perform well. Additionally, the agency said that the combined slot machine base of nearly 70,000 units would already eclipse both Aristocrat and L&W.

The merger, Fitch said, “should enable more cross-selling opportunities between the two entities”.

The ole switcharoo

The Apollo deal is unusual in that two companies are being acquired and merged by a third party. But what makes it even more unusual is that IGT and Everi had already agreed to merge on their own some four months earlier.

State regulators had begun work related to the first agreement when the change was made, board members said on Wednesday. Hendrick jokingly referred to it as a “hold my jacket” scenario, with Apollo jumping into the mix at the last minute.

Several changes were made between the original deal and the eventual Apollo agreement. The most notable was the leadership, as current IGT CEO Vince Sadusky was originally slated to lead the newly combined business. Everi Chairman Mike Rumbolz was supposed to chair the new board. Instead, Sadusky is leaving to become CEO of IGT’s spun-off lottery business, while there has been no mention of a new role for Rumbolz.

Cohen said that Apollo had made multiple offers to IGT specifically starting in 2014. When the first merger was announced, the firm felt that it could better unlock quicker cash value for shareholders of both companies. And of course, it represented a rare opportunity to make a significant investment in a sector where Apollo has experience.

“We were able to come to a transaction that effectively just turned the stock consideration both shareholders were going to receive into cash,” Cohen explained. “So all the shareholders at both companies didn’t necessarily need to take the risks of execution and integrating the companies…. We will undertake that effort.”

Misplaced anger?

One of the stranger interactions at the hearing came from board member George Assad, who ranted about the string of AML violations the state has seen this year. At one point Assad said that the most important lesson was to “keep the marketing team the hell out” of compliance matters. This was a reference to the push and pull of attracting high-value customers while balancing obvious AML risks.

Despite the fact that all of the violations have come from casino operators and not suppliers, Assad grilled officials on their compliance efforts.

Everi Chief Legal Officer Kate Lowenhar-Fisher explained that both compliance staffs are still in place for the time being. They will be merged later into a single unit, although Lowenhar-Fisher acknowledged board guidance would be needed for this.

“I think we’re going to learn a lot from each other,” she assured Assad.

In order to close the transaction by 1 July, Apollo needs eight more jurisdiction approvals, she said. Aside from Nevada, which is not technically finalised until the commission signs off, the other most important locale is Pennsylvania later this month. Overall, she said, the company expects to receive all approvals in that time frame.

A board in flux

As mentioned, Hendrick will now step down as NGCB chair, handing the reins to former Gaming Arts CEO Mike Dreitzer.

Numerous speakers on Wednesday praised Hendrick for his tenure, although it was supposed to run through January 2027. Gibson was among the supporters, but he also stepped down in 2022 before the end of his term. When Dreitzer takes over on 23 June, he will become the fifth board chair since January 2019.

So far this year, the board has issued multimillion-dollar AML fines to Resorts World, MGM Resorts and Wynn Resorts. A fourth investigation in process involving the Fontainebleau was inadvertently leaked at last month’s commission meeting.

Many have called the recent era perhaps the bleakest regulatory period in state history, especially for the “gold standard” US gaming market. This has been made worse by the fact that the three investigations that led to fines were unearthed by federal authorities, not state regulators. Stakeholders are hopeful that Dreitzer, as a longtime veteran of the industry, can lend a fresh perspective to one of gaming’s most crucial bodies.

The difference isn’t demand – it’s friction. Moral resistance (especially in the south), entrenched brick-and-mortar interests and legislative inertia have slowed the spread of iGaming. In that vacuum, sweepstakes casinos have flourished, becoming America’s fastest-growing wagering vertical. Eilers & Krejcik projects the segment will generate $11 billion in 2025 – surpassing regulated iGaming in both reach and revenue. That’s a sharp rise from just $3.1 billion in GGR in 2022. 

Quick recap 

When we last covered sweepstakes, the major players were scaling rapidly but largely flying under the regulatory radar. That’s no longer the case. The sums at stake are now too large to overlook, prompting investigations, cease-and-desist orders and restrictions across a growing number of states. 

VGW, the Perth-based operator behind Chumba Casino, LuckyLand Slots and Global Poker, still leads the space. It is reportedly pulling in AU$6.1 billion in annual revenue, converting nearly half a billion to net profit. Founder Laurence Escalante, now estimated to be worth AU$4.5 billion, is said to be exploring a buyout of minority shareholders at a valuation near AU$3.2 billion (AFR).

Competition, unsurprisingly, has intensified. More than 25 new sweepstakes brands have launched in 2025 alone, pushing the active US roster above 140 sites and slicing VGW’s share from well over 90% to roughly a half. The space now resembles a digital land grab – equal parts opportunity and opportunism. 

Why players flock 

Sweepstakes win on accessibility and engagement. Sign-up is instant – usually just an email and phone number after which players receive “Gold Coins” for free entertainment and “Sweep Coins” as promotional credits that can ultimately be redeemed for cash. 

This structure allows operators to classify their products as promotional contests, rather than gambling – a distinction that radically changes their marketing power. They have greater freedom on advertising channels like Meta, Google and TikTok. Licensed operators are often locked out of these channels, blocked by state-specific compliance requirements, geofencing mandates and responsible gambling disclosures.

Consequently acquisition costs are substantially lower and growth is faster. Optimove data shows active-player growth at about 16%, more than triple the growth pace recorded in regulated iGaming. Conversion to first purchase is lower – roughly 12% versus 51% for licensed platforms – but those who do pay tend to stick. Wagering frequency nearly triples after the first month and long-term retention converges with licensed operators. 

The product is built for mobile. Most players access sweepstakes via apps and the experience borrows heavily from mobile gaming. To compete with TikTok and other distractions, operators lean into familiar mechanics: narrative quests, streak bonuses, loot boxes and social features all contribute to an experience that is akin to Candy Crush. 

With no tax burden or licensing fees, sweepstakes operators can reinvest aggressively into user experience, bonus optimisation, and product iteration – mirroring the approach taken by crypto casinos. 

Players generally fall into two camps. Some are seeking familiar IGT or Aristocrat titles which are unavailable in their state; the second engages for the game loop itself, chasing levels, achievements and social status rather than pure cash-out value. As iGaming expands into more states, the question will be whether these users migrate to regulated platforms. 

If it walks like a duck… 

Sweepstakes operators rely on the legality of their “promotional contest” model, which requires a free method of entry to preserve their claim to non-gambling status. While only 12% of users convert to a first purchase, those players spent an estimated $8.5 billion on Gold Coins in 2024, pushing sweepstakes revenue above regulated iGaming for the first time. Advertising leans heavily on jackpots and cashouts, and the mechanics, UI and user flow often closely resemble those of licensed online casinos. 

The oft-cited McDonald’s-Monopoly analogy doesn’t really carry. At McDonald’s, the sweepstakes element is tacked onto the product. Whereas here, the contest is the product. This disconnect between legal theory and consumer and economic reality is what’s now driving the scrutiny. 

Regulatory heat 

Regulatory pressure is mounting – and it’s no surprise. In 2024, US states collected a record $15.9 billion in gaming tax revenue, all built on a system of licensed operators who follow strict rules. To incumbents, both land-based and online, the frustration is obvious. Every untaxed Gold Coin sale feels like lost revenue and a challenge to the integrity of the licensed market. 

Montana was first to act, with a full ban taking effect on 1 October 2025. Connecticut and Louisiana are set to follow with bills having passed both chambers, and awaiting enactment. Cease-and-desist notices and warnings have been issued in multiple states. VGW exited Michigan and New York quietly, anticipating regulatory action. High 5 Games paid a $24.9 million fine in Washington and settled separately with Connecticut for $1.5 million. These quiet exits and fast settlements suggest operators aren’t interested in fighting battles where friendlier markets are still wide open. 

What to expect 

Despite mounting scrutiny, many states remain open terrain. Enforcement takes time, and in jurisdictions where regulation is slow or fragmented, sweepstakes casinos continue to operate with little friction. 

A range of outcomes is now in play. More states will move to ban the model entirely, with a likely domino effect to follow. Others may pursue light-touch licensing, introduce taxation frameworks, or establish new regulatory categories. Rising compliance costs will drive consolidation, favouring the scale players over the opportunists. And many states may choose to do nothing – at least for now. 

For operators, a fork in the road is fast approaching – double down on short-term growth, or pivot toward long-term legitimacy. Just as daily fantasy helped open the door for legal sports betting, sweepstakes could end up accelerating broader iGaming reform. As lawmakers confront the scale of untaxed, unregulated gambling, formal regulation may start to look like the simplest and most lucrative solution. 

The Opportunity 

When regulated markets stall, grey markets emerge – and the gap between them becomes fertile ground for innovation. One theme we are actively exploring is AI-driven solutions that combat turnover leakage to offshore operators – a multi-billion-dollar challenge in mature regulated markets. It is a clear example of how friction breeds opportunity and where we see the next wave of value being built.

Waterhouse VC is a fund that specialises in global publicly listed and private businesses related to wagering and gaming sectors. The fund is only available to wholesale investors.

Since inception in August 2019, Waterhouse VC has achieved a gross total return of +3,252% (annualised at 84%), as at 31 May 2025, assuming the reinvestment of all distributions. 

Speaking to Sigma magazine ahead of the changes, Moreno Marasco, the president of Italy’s LOGiCO online gambling association, predicted a steep decline in the number of operators active in the jurisdiction.

Compared with the previous tender that attracted 93 applications, only around 50 are believed to have thrown their hat in the ring this time around. At current predictions, the Italian market is expected to shrink from the current 81 to around 33 concessionaires, cutting the number of remote operators by around 60%.

“This is a significant drop, despite the Italian market’s exponential growth in both revenues and legal operators,” Marasco said.

When the new system comes into force, he added, “the competitive landscape will be thoroughly redrawn”.

The main reason behind this tectonic shift is that ADM has set much higher hurdles for would-be concession-holders this time around. One in particular – an initial licensing fee of €7 million – has inevitably priced smaller players out of the market.

Rapid consolidation

According to Christian Tirabassi, founder and senior partner at M&A advisory firm Ficom Leisure, this consolidation is exactly what the government had hoped to achieve.

For years, there were surprisingly few barriers to entry into one of Europe’s most affluent and prominent gambling markets. Now, in a move to modernise its legislation and bring regulations up to speed with the scale of the market, regulators are weeding the smaller fish out of an increasingly sizeable pond.

“There are very small companies that were able to operate in a market that was [worth] €4 billion at the time, now €5 billion, with an investment of €250,000,” said Tirabassi, referring to the previous cost of an Italian remote gaming concession.

“The regulator decided that this is not acceptable. You don’t want to put a delicate operation like this in the hands of a company without financial strength.”

This time around, the focus has been on companies that can meet the highest financial, technical and compliance standards – those who, in the words of Tirabassi, won’t skip AML requirements to save €5,000.

‘Natural selection’

As well as shelling out €7 million per vertical and per brand, online sports betting and online casino operators will pay 24.5% and 25.5% tax on GGR respectively. Operators are also subject to an annual fee set at 3% of GGR and must spend at least 0.2% of their GGR on responsible gambling campaigns – capped at €1 million.

In preparation for the new concessions scheme, Ficom has been involved in several M&A deals in which small- and medium-sized operators were absorbed by larger ones. While consolidation is nothing new, Italy’s gambling reform seems to have dramatically accelerated the trend.

“Post-tender, we expect large, integrated, multi-product, multi-channel companies to dominate the market,” Tirabassi explained.

In future, the M&A specialist expects just a handful of operators to generate around 80% of Italy’s €5.2 billion in remote GGR, with no more than 30 or 35 operators active in the legal market as a whole.

“The reform has brought the price of the licence to a normal level,” he added. “The previous price – how cheap it was – that was the abnormal part. Add to that the stricter requirements and the fact that, to be successful in Italy, you need to be omnichannel. All of that has created natural selection in favour of larger corporations.”

Sweeping gambling reform in Italy

The rapid concentration of revenues in the hands of a small number of operators is far from the only change afoot in Italy. With its overhaul of the system, the government wants to ramp up standards in everything from cybersecurity to AML and player protection.

An outlier within Europe, Italy has regulated online gambling since 2006. When the new technical reforms come into force – some months after the concessions are awarded – it will put an end to a scheme that has been in place for almost 20 years.

Some new regulations are designed to adapt to – and make better use of – the trend towards digitalisation. For example, a number of new player protection tools will be put in place, allowing customers to set limits on their deposits, spend and playing time, as well as self-excluding from online platforms.

Automated warning alerts will also aim to dampen compulsive behaviour, with stricter controls targeted at the younger 18-24 age bracket – a first in European regulation.

The relative stability in Italy’s gambling market over the last decade has paid dividends for the industry, with total GGR hitting €21.6 billion in 2024 – up 4.4% from the year before. Around a quarter of this – €5 billion – was accrued online and operators are seeing dizzying growth in this sector.

Flutter primed to lead with Snai in its Italy inventory

This consolidation has already been seen in deals like Flutter’s €2.3 billion acquisition of Playtech’s Snaitech last year.

In September, analysts at Jefferies estimated Flutter could end up with a 30% share of the Italian gaming market with Snaitech in its portfolio, thanks to its multi-brand positioning. It expects the group to maintain a top spot for online share.

Flutter had a 15% GGR share of the Italian online betting and iGaming market in 2023 through its Sisal and PokerStars brands. Snaitech came in just behind on 10%.

Delays to land-based Italy gambling reform

Along with the new remote concessions, Italy is also set to overhaul its land-based market, unifying its licensing scheme, introducing strict location rules, limiting cash deposits to €100 per week and introducing mandatory ID and self-exclusion systems.

However, pressure from regional authorities has forced the government to push back these reforms to mid-2026, rather than the end of 2025 as previously planned. By then, the federal and local governments will aim to clarify some crucial questions over funding.

According to Tirabassi, success in the Italian market depends on having a scalable omnichannel business, operating both online and land-based gambling under the same brand.

Since skins are forbidden under the new concessions scheme, operators will have to secure concessions not just for every vertical and channel they want to operate in, but also for any separate brands. This could make the consolidation of the market all the more visible in future.

With the higher barriers to entry, the Ficom founder predicts those who win out in the market could ultimately reap much greater rewards, sharing larger proportions of an even larger pie.

Amid these rapid changes, however, one thing is set to remain the same: incumbent IGT will continue to exclusively operate the Italian lottery until 2034.

After a nail-biting clash of the titans, the IGT-led consortium LottoItalia announced it had beaten contender Flutter to win a nine-year renewal of its exclusive lottery concession. It did so by putting together a bid of €2.23 billion for tender – more than double the €1 billion base price – proving once again that in the modern Italian market, it’s all about financial clout.

Over the course of the 49-minute hearing, senators grilled the Ohio Republican about the various facets of leading the commission, on which he served from 2017-2021. The breadth of questioning was indicative of just how wide the commission’s scope really is.

In less than an hour Quintenz answered questions about agriculture, ranching, cryptocurrency, financial markets, bipartisanship and event contracts, all of which fit under the CFTC’s purview in some way.

Gaming stakeholders were closely watching Quintenz’s comments regarding prediction markets in particular. The markets, especially since launching sports contracts, have disrupted the states’ rights framework for gaming and have introduced a federally legal sports betting-adjacent product.

In 2021, when Quintenz still served on the CFTC, he publicly dissented from the commission and endorsed sports contracts as legitimate commodities in another case involving the exchange ErisX.

He made clear on Tuesday that he still strongly holds that belief.

‘That other act you mentioned’

“I believe that the law is very clear about events that have commercial, financial or economic consequence qualifying as commodities, because the [Commodities Exchange Act] recognises that therefore, a viable and valuable futures market can be listed upon them and afford people the opportunity for risk management, price discovery and price dissemination,” he said.

The quote came in response to a question about tribal gaming rights from California Senator Adam Schiff. Since the start of the year, tribes, especially those in California, have been at the forefront of the prediction market debate.

In late May, the CFTC met virtually with tribal leaders to hear their concerns. But current commission Chair Caroline Pham essentially said there was nothing to be done until a new regime is implemented, per InGame.

Quintenz told Schiff that, should he be confirmed, he would have “a very robust, all-stakeholder engagement process around this” and that he “would listen to the concerns of the tribes”. Yet his next comment seemed to indicate that he had no plans to interfere with the current trend.

“Nothing in the CEA that I’m aware of prohibits or affects the opportunity of tribes to offer those products, those markets and those services,” he stated.

Later, Schiff suggested that the Indian Gaming Regulatory Act is not preempted by the CEA, something that Indian law experts have argued. Quintenz notably referred to it in his response as “that other act you mentioned”.

Conflicts of interest

Several questions from lawmakers sought to address an elephant in the room – Quintenz currently serves as head of policy for a16z, a cryptocurrency venture capital firm and, as a board member for Kalshi, the most prominent US prediction market. He now stands to chair a commission heavily involved in the regulation of both.

Earlier this year Quintenz said in an ethics letter he would follow all necessary protocols to step down from his roles and divest any holdings. This was reiterated before the committee.

“I will abide by all applicable ethics statutes and regulations,” he asserted. “I have a very robust ethics agreement that does require my divestiture. I will have a screener in my office to ensure that no matter inappropriately comes before me.”

Pressed further on the issue, Quintenz maintained that he would not imprint his personal values into his work, despite the fact that his support for crypto and prediction markets is rather clear.

“In the past, the agency has taken an approach that I had disagreed with, in terms of adjudicating which contracts may be acceptable or not,” he said, acknowledging the ErisX case. “I believe that it is the role for this body and for Congress to decide what is acceptable or appropriate. I think it is the role of the agency to follow the statute.”

Yet, here too Quintenz was quick to caveat that he believes prediction markets to be in line with the statute (CEA), indicating that to him, overseeing prediction markets is simply following the law.

Do-it-yourself

One of the other notable lines of discussion involved the self-certification process. Unlike gaming regulatory frameworks, in which entities secure approval for an offering before it goes live, CFTC-regulated designated contract markets (DCMs) can self-certify contracts and begin offering them immediately.

The CTFC then follows behind and either requests that they be taken down or takes no action, which is most common. This is the primary reason why the range of sports contracts on prediction markets has expanded so quickly.

Detractors have harped on this point, saying exchanges like Kalshi are exploiting this system. Quintenz argued that such a system, which was implemented in the early 2000s, is necessary for efficiency.

“When the CFTC had to approve new futures contracts, futures exchanges listed about 700 products total,” he explained. “In the 20 years since self-certification came online through the Commodity Futures Modernization Act, 16,000 new contracts have been listed by exchanges. None of them caused the Financial Crisis.”

The times, they are a-changin’

It’s difficult to analyse Tuesday’s hearing from a legal sports betting perspective. Some might argue that sportsbooks have every avenue at their disposal, including offering prediction markets themselves, as Quintenz alluded to.

But that option is far from a guarantee. For one thing, court rulings or legislative interventions could quickly topple the progress prediction markets have enjoyed. That makes any substantial investment risky, although books are certainly doing their due diligence.

DraftKings earlier this year applied and subsequently withdrew an application for “DraftKings Predict” with the National Futures Association. Flutter confirmed in its Q1 earnings call that it has moved some Betfair staff to FanDuel to explore exchange possibilities.

Additionally, the question of market saturation becomes real very quickly. As of now there are just a few DCMs, but as Sporttrade CEO Alex Kane noted on a recent webinar, the market would likely suffer from an influx of exchanges all offering similar contracts.

Sports event contracts are currently somewhat bland compared to the parlay and bonus options offered by books, meaning market share would be tough to come by.

The traditional legal landscape, though, is also growing increasingly uncertain. Tax increases are becoming commonplace, including a first-ever per-wager tax recently enacted in Illinois. Some federal and state lawmakers have pushed for more stringent regulations and only one new market has legalised since the start of 2024 (Missouri). Some bills were even introduced this year seeking to rescind sports betting from various markets.

This groundswell, in conjunction with the advent of prediction markets, DFS 2.0, social sportsbooks and other adjacencies, makes for perhaps the most interesting time for bookmakers post-PASPA.

Aboard Derby winner Sovereignty, Alvarado angled to the far outside to move within striking distance. By the time the rivals reached the eighth pole, Sovereignty found a new gear and easily raced past Journalism, the Preakness winner. Practically shot out of a cannon, Sovereignty finished the final quarter in a fleet 23.99 seconds, completing the last eighth in under 12.

At the classic distance of 1 ¼ mile, his time of 2:00.69 ranked as the second fastest ever at venerable Saratoga Race Course, a track that opened in 1863. This came after Godolphin LLC and trainer Bill Mott had taken the unusual step of skipping the Preakness while pointing Sovereignty toward the Belmont. Removing any chance for a Triple Crown, Mott opted to rest his horse for five weeks.

“The Godolphin team and myself together made a decision,” said Mott in the post-race press conference.  “I think you have to be man enough to stand up to the decision you made. In this case, I don’t think it was wrong.”

Opting for longer breaks

For decades, the Triple Crown has maintained a consistent schedule for one of the most gruelling propositions in sports. Since 1919, only 13 horses have won all three races, with Justify as the last in 2018. The Kentucky Derby is typically held on the first Saturday of May with a two-week break before the Preakness. From there, horses receive three weeks off before the final leg, the Belmont.

Gone are the days when trainers routinely enter their horses on short rest. Whirlaway, the 1941 Triple Crown winner, raced an astounding 60 times in a lengthy career. Several years later, Citation became the eighth Triple Crown winner when he accomplished the feat in 1948. Calumet Farms’ Citation notched 32 wins in 45 lifetime starts, producing career earnings in excess of $1 million.

Mystik Dan, the 2024 Kentucky Derby winner, ran just seven times as a three-year-old and only once after finishing a tiring eighth in the Belmont. As with Journalism, Mystik Dan represents a rare case of a three-year-old that entered all three legs. Mystik Dan took off six months before returning in last December’s Malibu Stakes. Flightline, the 2022 Horse of the Year, only raced three times that year and just six in his illustrious career.

Johny Avello, DraftKings director of sportsbook operations who has booked horse racing for more than 40 years, indicated that a change in the Triple Crown calendar should at least be considered.

“Race purists probably won’t like it, but it might be the right thing to do for the game – five weeks to run three races is very difficult,” Avello told iGB.

Moving back The Preakness?

Avello spoke following La Cara’s resounding win in The Grade I Acorn. On a sloppy track at Saratoga, La Cara led from the start, upsetting previously undefeated Good Cheer. The victory handed trainer Mark Casse his first career Acorn.

Casse, who has more than 3,560 career victories, won the 2019 Preakness with War of Will. At last month’s Preakness, only three horses from the Derby returned for the second leg of the Triple Crown.

Casse entered Sandman, who finished third behind 8/5 favourite Journalism. Of the 20-horse field in the Derby, only Journalism, Sandman and American Promise returned for the Preakness.

Describing Bill Mott as one of the “greatest horsemen” in the history of the sport, Casse told iGB that he would never question the trainer’s decision-making on the track.

But Casse has recently shifted his position on the timing of the Preakness. Casse now supports a larger cushion between the first two legs.

“If you move it back 30 days, you will have a better field,” Casse noted. “It’s still not going to be easy, but I’m for moving it back.”

‘It’s happened before, it’ll happen again’

Prior to last Friday’s Just A Game Stakes, Mott was in no mood to discuss the possibility of a revamped calendar. When approached by iGB, Mott declined to comment on any potential changes to the Triple Crown schedule. However, he answered several direct questions on Sovereignty, adding that the decision to skip the Preakness was in the “best interests of the horse”.

If the Preakness were moved to the first weekend of June, the New York Racing Association could respond by moving the Belmont to a date near the Fourth of July. While Journalism pushed himself to the limit by racing three times in a short period, some suggest that Sovereignty received a distinct advantage with a five-week break.

Godolphin director of bloodstock Michael Banahan appeared with Mott at the post-Belmont press conference. While the likes of American Pharoah and Justify have ascended to the pinnacle of the sport in winning the Triple Crown, Banahan pointed to the many Belmont Stakes photo finishes that have robbed others of the accomplishment.

Since 1995, 11 horses have won the first two legs, with those like Real Quiet and Smarty Jones then beaten before the wire in excruciating fashion.

“It’s happened before and it’ll happen again,” Banahan said of the decision to skip the Preakness with the winner of the Kentucky Derby. “Those are decisions that whomever wins in the future will need to make.”

Civil penalty proceedings against Star and its entities commenced in late 2022 after the case was opened in June 2021. The operator is accused of numerous AML violations over a period of several years, ranging from insufficient reporting protocols to a lack of managerial oversight and more.

Much of the shortcomings outlined in the investigation relate to Star’s dealings with Chinese-linked junket operators. Chief among them was the infamous Suncity Group, whose former chairman Alvin Chau is currently serving an 18-year prison sentence in Macau on illegal gambling charges.

Initially charged with 289 criminal counts, Chau received the conviction although a judge acquitted him on infractions pertaining to money laundering. Prosecutors accused Chau of facilitating a series of undeclared bets that exceeded HK$8.25 billion (US$1 billion) in taxable income. Among the local Chinese media, Chau received the nickname “Washing Rice Wa”, after a sitcom character.

A potential AU$400 million fine

According to the Australian Financial Review, AUSTRAC said on Wednesday that from November 2016 to October 2020, Suncity junkets had turnover of more than AU$70 million (US$45.5 million) per week at Star Sydney alone.

In the case of Star Queensland, Suncity was not an approved operator, but the entity held 180 junkets for Suncity associates during that time, regulators said. Overall, international visitors on junket tours spent upwards of $125 billion with the operator over the period.

The agency is pushing for a $400 million fine, which would be slightly less than the $450 million fellow operator Crown Resorts paid in 2023 for similar violations. Star, which has been on the brink of collapse for nearly two years, has said that even a $100 million penalty could imperil its future.

Soon after the case opened Wednesday, proceedings were moved to closed court for the cross examination of Star CFO Frank Krile. Last December, Krile joined Star from Lendlease.

Customers one and two

Insufficient due diligence checks were among the biggest violations cited in relation to Suncity. The investigation found that Star was aware Suncity was funded by a “customer one”, who also owned the outfit alongside “customer two”. Star supposedly knew as early as November 2016 that customer one was linked to organised crime.

Additionally, the company only stopped dealing with Suncity and Chau when he was arrested in 2021, despite being alerted about potential AML risks as early as 2019. In court filings, Star admitted that from 2018 to 2021, at least $1 billion came from junkets known to pose “higher” than normal AML risks.

“Appropriate risk-based controls were not in place to enable Star Sydney and Star Queensland to understand the sources of money moving through these high-risk channels, or whether there was a risk that money was illicit,” the filings read, per AFR. “These business practices and risk management failures exposed Star to the risk of money laundering.”

The Hong Kong-listed Suncity changed its name to LET Group Holdings in 2022 after Chau’s former stake was acquired by Andrew Lo.

Double whammy

Star’s federal proceedings largely rehash what has already been unearthed in various state-led inquiries from recent years. At the state level, both of its existing casino licences are suspended and its properties are under the supervision of outside manager Nicolas Weeks. The company has already paid hundreds of millions in state fines and has recycled most of its board and C-suite.

In New South Wales, Star’s flagship Star Sydney property has twice been deemed unsuitable for licensure, most recently in October. The NSW Independent Casino Commission subsequently ruled in March that it was extending Star Sydney’s licence suspension and Weeks’ term again, through 30 September. Such a ruling indicates that a licence revocation may remain on the table, which would throw a huge wrench into the company’s plans.

In Queensland, Star faces a looming 90-day suspension of its licence, which was ordered in 2022 but has been delayed since. Despite this, Weeks has also been in charge of Star Gold Coast throughout that time. That suspension is also slated to begin after 30 September.

Star made the aggressive move to divest of its Brisbane operations in March by selling its 50% stake in the multibillion-dollar Queen’s Wharf development back to partners Chow Tai Fook and Far East Consortium. By doing so, Star helped ease its financial hardships by relinquishing substantial commitments related to the project. The company also consolidated full ownership of Star Gold Coast, viewing that as a better long-term investment.

Bally’s in the background

The threat of a massive AUSTRAC fine is complicated by the fact that Star agreed to a $300 million takeover offer from US-based Bally’s Corp and billionaire Bruce Mathieson in April.

In January, the operator sounded the alarm that it was bleeding cash and had limited time left to secure a lifeline. That then kicked off a frenzied search for lenders and refinancing deals before the Bally’s-Mathieson deal was ultimately agreed to.

Star has already received the first $100 million tranche from the two investors, which did not require approval. The company is scheduled to hold a shareholder vote on the remaining $200 million tranche at its annual meeting 25 June.

When the deal was agreed to, there was serious doubt as to whether Bally’s could afford such an investment, or whether Star would need multiple capital infusions to ultimately survive. In Q1, Bally’s reported cash reserves of $209 million versus total debt of nearly $3.5 billion. The company is heavily leveraged as it builds casino projects in Chicago and Las Vegas and continues to lobby for a New York casino licence at its golf course in the Bronx.

It is unclear at this time how such a massive penalty would impact the nascent takeover. As of writing, Star stock was trading at 11 cents, down more than 75% in the last year.

A coalition of tribes subsequently sued a group of over 90 defendants made up of cardrooms and TPP providers in January. The case is being heard by the Sacramento Superior Court under case number 25CV000001, with its next hearing set for 8 August.

At issue is the years-long dispute over the legality of games offered by cardrooms and whether they constitute “house-banked” games, in which players wager and play against the house rather than other players. Tribes have had exclusivity over Class III gaming, which is another name for house-banked play, since 2000.

Per state law, cardrooms are permitted to offer certain table games as long as they are played and dealt among players, as in recreational or charitable settings. Over the years, however, cardrooms have enlisted TPPs to help facilitate gameplay, as most recreational players want Class III-style gameplay and don’t wish to serve as the house or dealer. TPPs partner with cardrooms to offer these services and are required to be financially independent from the rooms in which they operate.

Tribes have long contended that this crosses the line into banking games and therefore violates their exclusivity. The SB 549 suit is the culmination of several years of bad blood and its outcome could significantly alter the gambling landscape of America’s most populous state.

Tribes take issue with games

The most recent complaint filed by plaintiffs came on 23 April from the Rincon Band of Luiseno Mission Indians. Another was filed on 18 February by the Agua Caliente Band of Cahuilla Indians.

In the Rincon complaint, the tribe asked that the court find the cardrooms and TPP providers to be in violation of both the state constitution and state penal code for offering blackjack, baccarat and pai gow poker-style games in a manner that constitutes house banking.

“The TPP defendants maintain and operate a bank by maintaining and occupying the player dealer position in the blackjack-style games offered by the cardroom defendants,” the complaint reads. “Consistent with the type of banked games offered in Nevada and New Jersey casinos, in defendants’ blackjack-style games, the player or entity banking the game is not limited to winning or losing only a fixed and limited wager during the [play] of the game. Uncertainty over how much the [player] or entity banking the game will win or lose is typical of a banked game.”

Contracts, relationships in question

Additionally, the complaint also touches on the contractual relationship between cardrooms and TPP providers. As mentioned, the two sides are supposed to be fully independent, but analysis from Capitol Weekly has shown that those delineations are complicated and difficult to parse.

“TPP defendants enter into contracts with cardroom defendants wherein the TPP pays the card room for the right to occupy the player-dealer position in blackjack, baccarat, pai gow poker and analogous games,” the complaint reads. “The only source of revenue TPPs possess to pay the card rooms pursuant to those contracts is the TPPs’ winnings from occupying the player-dealer position in those games.

“Accordingly, cardroom defendants have an unlawful interest in the funds wagered, lost and won in the games they offer or operate where a TPP occupies the player-dealer position and banks the game.”

Cardrooms cite conflicts in state laws

The most recent rebuttal on behalf of cardrooms was filed on 2 May by Artichoke Joe’s, a facility in San Bruno.

Its attorneys highlighted the fact that tribes have tried multiple times to bring such a suit, but were unsuccessful before SB 549 was passed. A 2021 lawsuit was tossed due to insufficient standing from tribes and, in 2022, a provision was added to Proposition 26 that would have allowed “any person or entity” (ostensibly tribes or tribal members) to sue any cardroom over any game.

Prop 26 was, at its core, a retail sports betting amendment that ultimately failed by a wide margin. These defeats did not deter tribes, who sought to “rise like a a phoenix” and pursue the new legislation instead, per the motion. By doing that and not putting the matter to the voters, Indian Country “accomplished an end run around” its previous missteps.

The issue of Prop 64

The passage of SB 549 finally created the pathway for tribes to bring the matter before courts. But Artichoke Joe’s pointed to an existing state law from 2004 – Proposition 64 – that conflicts with the cardroom bill. That proposition says that any plaintiff must have individual standing in order to sue, or “an injury in fact in the form of lost money or property as a result of such illegal acts”.

Due to the fact that a group of tribes is suing a group of defendants, each must have standing for the other, the motion alleges. It cited examples of tribes and cardrooms in the suit that are on opposite ends of the state, arguing that the actions of one couldn’t directly harm the other. Further, the motion points to the fact that an initiative like Prop 64 can only be amended or repealed via voter approval.

“Because the purported amendment at issue here was not approved by the electorate, it is not legally enforceable and any action based on the invalid statute must be dismissed,” the motion reads. “Simply put, because SB 549 takes away the restrictions on such relief imposed by Proposition 64, the court must find SB 549 is void ab initio.”

Rulemaking process also ongoing

As the suit unfolds, the issue is further complicated by concurrent regulatory proposals from the state. Beginning in 2023, Attorney General Rob Bonta and the state’s Bureau of Gambling Control (BGC) set out to change regulations related to blackjack games and player-dealer requirements.

The proposals are extremely similar in nature to the suit itself, in that the new regulations would require cardrooms to change several aspects of blackjack-style games, including a non-21 target point and the removal of the “bust” feature. Additionally, they would implement stricter guidelines regarding the rotation of player-dealer duties and restrictions on TPPS procedures.

A string of public comment hearings were held in late May by the BGC and the majority of feedback came in support of cardrooms. The portal for public submissions is now closed as the BGC mulls the two proposals. In its own impact assessment from last August, the state acknowledged that the new rules would likely cost cardrooms hundred of millions in revenue and a large chunk of jobs.

Dozens of small cities around the state rely on the taxes generated by the rooms and, in some cities, this represents fully half of municipal funding. In this way, cardrooms and tribes share a remarkably similar desire to utilise their business to provide for their communities. Now, state officials will decide if both can continue doing so.

Several pending tribal land-into-trust applications were approved in short order, including some for off-reservation projects. These approvals have historically been all but impossible to obtain, but that precedent was seemingly abandoned by the Department of the Interior (DOI) and outgoing secretary Deb Haaland.

Perhaps the most controversial approval was granted to the Koi Nation of Northern California. The tribe has plans to build a $600 million development with a 400-room hotel and a casino with more than 500,000 square feet of gaming space and 2,750 slots on a parcel near Windsor, in Sonoma County. If built, it would become one of the largest tribal casinos in California and in the US.

Originally proposed in 2021, the Koi project sought a “restored land” exception from the DOI. This meant that the tribe believed its historical connection to the land justified approval, even though it was outside its existing reservation. Such requests are common for smaller tribes like the Koi who may have been displaced over time or were considered landless.

According to Voice of America, the tribe was first recognised in 1916 under a different name and was granted a parcel of land in Lake County. Much of that land was deemed unusable, however, and most of the tribe relocated to Sonoma County shortly after. In the decades afterward the tribe was forgotten through clerical errors but was restored by a DOI ruling in 2000.

Ultimately, Haaland and the DOI sided with the Koi and approved the trust application on 13 January. That ruling has since kicked off an increasingly large amount of pushback, including from the state itself.

No friends among tribes

Perhaps the biggest and most outspoken opponents of the Koi project are other gaming tribes. The most powerful among them is the Federated Indians of Graton Rancheria (FIGR), operator of Graton Resort and Casino. Graton is the largest casino in the Bay Area and is in close proximity to the Koi site. It embarked on a $1 billion expansion in 2023.

FIGR filed suit against Haaland and the DOI last November before the approval was even granted and then again after the fact in February. The tribe has argued since 2021 that the Koi site infringes on its ancestral lands and circumvents rigorous tribal land-into-trust requirements.

“Their claims of historic connection are flawed and, if accepted by the Department of Interior (DOI), would set a dangerous precedent for all California Indians – in fact, for all Indian Nations – not only creating the reality of a casino on every street corner but, no doubt as a result, also creating a major challenge to what currently constitutes our sovereignty as federally recognised Indian nations,” FIGR Chairman Greg Sarris said in a statement published last July.

In addition to FIGR, three other nearby California tribes – the Dry Creek Rancheria, Cloverdale Rancheria and Lytton Rancheria – filed a separate suit against the DOI in February.

“This approval is nothing short of a political manoeuver that disregards the rights of Sonoma County’s historic tribes,” Lytton Rancheria Chairperson Andy Mejia said in a statement. “It undermines tribal self-determination, disrespects the cultural heritage of our people and sets a dangerous precedent that would allow any tribe to claim land far outside its ancestral territory to open a casino.”

Non-tribal opposition also rising

In a somewhat rare occurrence, the state of California and other local officials are joining the mix. Governor Gavin Newsom’s office filed suit against the DOI in May and, like tribes, Newsom and his team took issue with the restored lands exception. As with FIGR, Newsom had called on DOI to reject the proposal last year before it was even official.

“The record on which Interior relied in its decision is insufficient to show that the acquisition of the Shiloh Site constitutes a ‘restoration’ of the Koi Nation’s tribal lands. Interior’s decision is therefore contrary to law and otherwise arbitrary and capricious,” the suit alleges, per Courthouse News Service.

On the local level, two officials have filed briefs in support of the FIGR suit, according to the Press Democrat. They are Lynda Hopkins, on behalf of the Sonoma County Board of Supervisors, and Windsor Town Manager Jon Davis. Both bodies had previously passed resolutions opposing the bid.

“The project is in an area of the County that does not allow commercial development and that has been subject to devastating wildfires,” Hopkins wrote.

In response, the Koi Nation has filed briefs of its own in attempts to intervene in the case, in which the tribe argues that the ruling was “not a close call”.

Another approval already rescinded

FIGR and other opponents are hopeful that the DOI will rescind the Koi approval just as it has done with another controversial Biden-era approval in California.

In January, the Scotts Valley Band of Pomo Indians also received last-minute approval for an off-reservation casino proposal in Vallejo before it was retracted for further review in late March by current DOI Secretary Doug Burgum. That case features several of the same arguments related to land rights, environmental review processes and federal-state relations.

Scotts Valley subsequently filed suit over the retraction, but a DC federal court has already denied any intervenors from joining the case. The DOI has yet to issue an update on the approval.

FIGR, for its part, has shifted its political spending, with some alleging it could be an attempt to curry favour in the Koi case. Typically a huge donor to Democratic causes, FIGR has pivoted this year and donated millions to Republican groups, per an analysis from the Press Democrat. Republicans currently hold control of the US Senate and House of Representatives and Burgum is also from that party.

“We give to causes we believe in regardless of political affiliation,” Sarris told the outlet. “As the original residents of this land, we stand for environmental stewardship, social justice for all and sovereignty rights for tribes.”

Although the bill’s rapporteur, Senator Carlos Portinho, eliminated a blanket ban on gambling ads from the proposal, the approved bill does include a ban on betting ads during live sporting broadcasts. The use of celebrities, influencers and athletes in any marketing material will also be prohibited, with the ban only applying to current players or those whose career ended less than five years ago. 

With both the Sports Commission and Senate having now approved the amended bill, it is headed to the Chamber of Deputies for review. 

The new law will likely not take effect until 2026, says Udo Seckelmann, head of gambling & crypto at local law firm Bichara e Motta Advogados. Seckelmann says he is relieved the “disproportionate” blanket ban has been eliminated, although he warns the push for further restrictions “lacks evidence-based support”.

“The motivations, although well-meaning, must be weighed against real-world outcomes – and the evidence suggests that informed, responsible regulation is more effective than prohibition,” Seckelmann explains. 

Current Brazil gambling ad regulations are sufficient

The Secretariat of Prizes and Bets (SPA) published Normative Ordinance No 1,231 in July last year, laying out how licensed operators could advertise their products. The regulations included restrictions on operators presenting betting as “socially attractive” or using ads to target children or adolescents. 

Additionally, all advertising from licensed operators was mandated to display an “18+” symbol and be guided by social responsibility and the promotion of responsible gambling. 

Lawyer Luiz Felipe Maia, founding partner of Maia Yoshiyasu Advogados, believes current restrictions on advertising are adequate, especially with Brazil having only just regulated its iGaming sector. 

“I think the current regulation is sufficient in protecting people, and they are coherent with this stage of the market, because Brazil has just become regulated,” Felipe Maia tells iGB.“When you have a new regulated market, it’s important to allow the regulated operators to advertise and to become known to the public, so that you can drive the public to those regulated operators. I think it’s [important] that we don’t have that many restrictions, such as in other regulated but more mature markets.” 

Fellipe Fraga, chief business officer at licensed operator EstrelaBet, agrees the current regulations are sufficient. “I believe it’s enough,” Fraga says. “Most important is to have conscience. The politicians and other regulators understand that the market is okay [as it is] and all the world is doing [online betting], so we can also advertise.” 

On the other hand, Betsul CEO Fernando Garita is keen for the advertising regulations to be more clearly defined. Garita is calling for clarity and consistency from the SPA: “A better balance is needed – one that enables responsible messaging without stifling legitimate commercial activity.” 

Enforcement is the priority 

While the licensed sector is generally content with current ad restrictions, many stakeholders are urging stricter enforcement be applied, especially when it comes to influencer advertising, which last year became a sector, and national media topic du jour.  

The game “Fortune Tiger” faced huge controversy last year. Influencers were investigated and in some cases arrested, after marketing the game to their followers and promoting attractive financial rewards. Many players ended up losing large sums of money playing the game on fraudulent sites. 

Since the scandal, the SPA has taken steps to further restrict influencer advertising. Internet personality Virgínia Fonseca appeared in front of the parliamentary inquiry commission for betting in May to be questioned over advertising gambling to her huge online following. 

Felipe Maia believes the SPA should crack down on those infringing upon current regulations. “I think if we start to have these cases where digital influencers will be held liable, have to pay fines and maybe be arrested for working with illegal operators or not complying with advertising rules, we will start to see different behaviours,” he insists. 

Overregulation risks empowering the black market 

The Brazilian gambling sector is by no means the only market experiencing pressure over its gambling advertising. Looking elsewhere at more mature markets, it’s understandable there are fears over the consequences of further restrictions. 

Germany, where nearly half of all players bet with the black market, has a ban on TV and online advertising between 9pm and 6am, as well as restrictions on showing sports clips in ads and partnering with sports personalities. 

Italy, which has a blanket ban on gambling advertising, is experiencing serious black-market issues, while Brazil’s neighbour Argentina has also taken steps to introduce a ban on online betting advertising. 

With licensed operators in Brazil already concerned by the presence of the black market, the industry fears more stringent regulations on advertising would only strengthen illegal companies, as seen in other nations. 

“Experience from countries like Italy shows that excessive restrictions and high taxes can backfire,” Garita explains. “Blanket bans would significantly reduce the visibility of regulated operators, while illegal ones would continue to thrive through uncontrolled channels like Telegram. 

“If you have a market becoming regulated with too many restrictions for advertising, basically you’re hurting channelisation and you are aiding the black market,” Felipe Maia adds. 

Gambling ads helps identify legal operators 

In fact, advertising is actually a hugely important tool for operators to demonstrate they have a licence and channel bettors into legal offerings, particularly in the early stages of a licensed market’s development, when competition among brands is fierce and player loyalty has not yet been established.  

With licensed operators’ advertising required to have an “18+” symbol, as well as information on the associated risks of addiction and pathological gambling disorders, Garita says the role of advertising in distinguishing legal from unlicensed operators is “a crucial one”. 

Garita says: “Advertising is one of the few public-facing tools we have to demonstrate that we operate legally.  

“It allows us to build trust, promote safety, educate users and show that we work within a regulated framework. Eliminating that visibility blurs the lines between legal and illegal operations – posing a major risk to consumers.” 

And even with advertising providing that distinction, markets like Sweden have found a high percentage of players still cannot distinguish legal operators from black market brands.  

What’s behind the negative public perception of gambling?  

Significant pressure was put on Brazil’s gambling sector in 2024, during a crucial period of establishing regulation. A Supreme Federal Court hearing in November was initiated after a leading trade union accused the new betting laws of being unconstitutional, amid fears that betting leads to high addiction levels and family debt. 

But four months into licensed betting, the public opinion towards betting seems to be improving, and in April a government-funded survey by DataSenado reported 60% of the population is now in favour of legalising land-based gambling. Part of the industry’s frustration lies in the belief that politicians are responding to public pressures, rather than data and global sector experiences that prove why ad restrictions could have unwanted consequences. 

But some politicians, particularly the rapporteur of the new advertising restrictions bill, have adopted a negative rhetoric around gambling, insisting it is harming public health and finances.  

Political echo chamber

Felipe Maia believes there isn’t actually a negative public perception of gambling in Brazil and asserts politicians are simply repeating the concerns of specific groups. “Basically, they’re responding to their echo chambers,” he says.  

“If they’re religious, they are responding to the groups they represent. If they’re more conservative, they are saying [these things] because this echoes well to their public. What you have is an opportunistic approach by some politicians to use this for propaganda purposes.” 

The situation is complicated further by Brazil’s long history of gambling prohibition, with the sector essentially made illegal in 1946. This has resulted in a lack of political understanding.  

“We’re trying to make them understand and, of course, in Brazil, with 80 years with cultural prohibition of gambling, they don’t really know yet what our industry does, what you can provide for the country,” says Fraga. “It’s a process for us to teach them, to explain to them [how our industry works] and to avoid those views, because many of these [bills] are talking about misconceptions.” 

What’s the solution? 

Ultimately, an effective response to Bill 2,985/2023 from Brazil’s betting sector could be handicapped by fragmented representation of the industry. 

According to Felipe Maia, there are five trade associations that represent betting companies, causing a lack of coordination and likely a weakening of the industry’s response to any perceived overregulation. 

“I had this complaint from a congressman. What they say is it’s very hard to deal with this industry, because they get different inputs from different associations and then they don’t know who to trust,” Felipe Maia declares. 

Collaboration is the way forward in Garita’s view. He agrees there is fragmentation in industry representation and that complicates the formation of an effective response. 

“Lobbying efforts and collective action by responsible operators and associations will be crucial,” Garita adds. “We need unity and coordination to defend common interests.” 

During the Sports Commission hearing to approve Bill 2,985/2023 in 28 May, Senator Portinho said the changes were necessary due to the sector’s inability to police its own advertising activities.   

Felipe Maia urges operators to self-regulate where possible, to prove they are good actors. “I think self-regulation shows social responsibility, maturity. And it allows you to come up with solutions that work for the industry before someone comes with an idea that will not work,” he says. 

Critical juncture coming up 

As Seckelmann explains, an assertive but constructive approach to advertising regulations could help mitigate the negative opinion held by politicians. “It is essential to emphasise that advertising, when done responsibly, plays a key role in channeling users toward licensed, safe operators and away from illegal sites,” he reiterates. 

As it stands, those seeking to restrict gambling look to be edging the battle, especially with the industry’s current inability to form a collective, data-driven response that effectively warns against the perils of overregulation on advertising witnessed in other markets. 

The industry’s point is clear: Overly restrictive measures on ads at this point in Brazil’s regulated online journey could prove disastrous and drive players out of the licensed sector. 

As the Chamber of Deputies, the Senate’s final stage, prepares to evaluate Bill 2,985/2023, Brazil’s betting sector must act quickly to make its case against the perceptions that threaten to damage the legal market’s progress.

Faced with a massive budget shortfall, Illinois lawmakers passed a $55.2 billion state budget on Saturday with minutes to spare. Along with tax increases on tobacco products and out-of-state income of businesses, the proposal contains a hike that will disproportionately affect the nation’s largest sportsbooks.

For the industry titans, the surprise proposal served as painful déjà vu from last spring when Illinois passed a progressive tax hike on sports wagering revenues. After this year’s bill passed late Saturday, Illinois Governor JB Pritzker vowed to sign it despite strong opposition from sports betting stakeholders across the state. The latest increase raises the question of whether top books will pass the tax burden on to their customers.

One option, according to Wall Street analysts, involves the embrace of prediction markets in which companies are able to offer derivatives on sports event contracts tax free.

Shouldering a higher tax burden

Illinois already drew the ire of leading books last year by enacting a progressive tax policy on sports wagering adjusted gross revenues. Through the policy, Illinois established a tax floor of 20% on AGR, up from the previous level of 15% across the board.

But the state also established a sliding scale that increased the tax rate for operators generating the highest revenue in the market. The structure contained various step-ups with a ceiling of 40% for operators generating annual AGR of at least $200 million. In response, DraftKings initially floated a proposed surcharge on customer wagers, taking a page from Uber, hotel chains and various airlines that have passed higher costs on to the customer. DraftKings abruptly pulled the idea last August, less than two hours after FanDuel informed analysts that it would not follow suit.

Under the newly proposed tax structure, Illinois sports betting operators will additionally pay a tax of $0.25 on each of their fiscal year wagers up to the first $20 million in handle. From there, operators will be taxed $0.50 for every wager above the $20 million threshold. While the new increase figures to have a modest impact on mid-tier operators, DraftKings and FanDuel are once more expected to feel the brunt of the hike.

Drawing comparisons with NY’s sky-high tax

Had the tax been applied to operators on a trailing 12-month basis, FanDuel would have faced a gross tax impact of $86 million, according to estimates from JMP Securities. The impact on DraftKings would have been $79 million. The two companies maintain a combined market share of at least 75% in Illinois.

The additional tax would place Illinois in the proximity of New York when it comes to the tax burden felt by the market’s two leading operators. In the Empire State, all operators pay a 51% tax on sports wagering gross gaming revenues.

New York shares the nation’s highest tax rate with New Hampshire, where DraftKings is the lone operator.

A plunge into prediction markets

While the tax changes would potentially present a combined negative tax impact of $165 million to DraftKings and FanDuel, the impact would be marginal for the state’s other eight operators. By JMP estimates, the remaining eight companies will face a combined levy of around $20 million. For fiscal year 2026, the gross tax impact will represent 5.4% of DraftKings’ projected EBITDA, according to JMP. None of the eight smaller operators would shoulder an impact above 0.5%.

Barry Jonas, an analyst with Truist Securities, outlined three potential scenarios for the two market leaders. One option involves imposing a floor for minimum bets, which Jonas believes would be greeted unfavourably by bettors. The companies, he noted, could also revisit the surcharge. The third option, he added, involves prediction markets.

By launching a Kalshi-style prediction market, the operators could sidestep the tax burden for now, Jonas writes. Both operators addressed the controversy surrounding prediction markets on recent earnings calls. DraftKings CEO Jason Robins indicated that the company will monitor the developments closely. Flutter, the parent company of FanDuel, noted that the company has brought on a team from Betfair’s exchange business to explore the opportunity.

A firestorm of criticism

The last-minute budget addition in Illinois unleashed a firestorm of criticism on social media. Proponents of legal sports betting questioned whether the added tax will stifle innovation and push customers to the illegal, offshore market. FanDuel enlisted former NFL Pro Bowl tight end Rob Gronkowski to urge Illinois lawmakers to abandon the proposal.

The tax represents the first time since the PASPA decision that a state has imposed a flat fee on sportsbook operators on a per wager basis.

“While the first in a nation tax was an assault on the gaming industry, it was a full frontal assault on the innovation, technology and the service economy,” said Brendan Bussmann of B Global Advisors, one of the nation’s foremost advisors on sports betting regulatory matters. “It’s clearly not a business-friendly climate.”

While the Pritzker administration celebrated the state’s seventh consecutive balanced budget, Republican opponents criticised the late additions. Republican Rep John Cabello objected that the process lacked transparency once again, according to a Capitol News Illinois report. State lawmakers first introduced the proposed tax hike on sports wagers on Friday, the day before passing the measure.

Cabello said, “We’re rushing this process like we always do: ‘Let’s hide this stuff. Let’s hide it so that the public doesn’t see it until it’s too late.'”

Neither DraftKings nor FanDuel would comment on the new tax when contacted by iGB on Monday. Both companies referred iGB to comments issued by the Sports Betting Alliance, a group that represents DraftKings, FanDuel, BetMGM and Fanatics Sportsbook.

“Make no mistake, this discriminatory, punitive and constitutionally suspect tax increase on legal sportsbooks who have invested more than a billion dollars in the state will be destabilising for regulated sports betting in Illinois,” the SBA wrote in a statement.

“Customers understand that they will be the ones to bear the cost of this new tax,” the SBA added. “With this change, lawmakers are essentially urging customers – and especially these small dollar bettors – to switch to unsafe and unregulated sportsbooks who defy state consumer protections and generate zero taxes for state priorities.”

After months of uncertainty regarding his ties to Kalshi, Brian Quintenz finally broke his silence on the matter. 

Quintenz, a member of Kalshi’s board of directors, plans to resign from the board if confirmed as chairman of the US Commodity Futures Trading Commission. Kalshi, a leading prediction market, is seeking clarity from the agency on regulations pertaining to sports event contracts. The Republican Quintenz received a nomination from US President Donald Trump to serve as chair of the CFTC in February. 

Quintenz made the disclosure in a letter to CFTC Deputy Counsel John Einstman. In addition, Quintenz disclosed that he holds unvested and stock options with Kalshi that vest on a monthly basis. If confirmed, Quintenz wrote that he plans to divest the options no later than 90 days after his confirmation. 

“The purpose of this letter is to describe the steps that I will take to avoid any actual or apparent conflict of interest in the event that I am confirmed,” Quintenz wrote. “It is my responsibility to understand and comply with commitments outlined in this agreement.”

A former commissioner with the CFTC, Quintenz penned the letter ahead of the derivative regulator’s conference call on Thursday with a group of tribal gaming entities.

In February, a contingent of tribal groups submitted formal comments to the agency stating their opposition to federal regulations on sports derivatives. Regulations on the federal level that allow prediction markets on sports events imperil tribal sovereignty, the groups contend.

WNBA’s Las Vegas Aces notch partnership with BetMGM

Three years after the Las Vegas Aces won their first title as a WNBA franchise, the franchise secured a partnership this week with a major US sportsbook. 

On Tuesday, BetMGM became the exclusive online casino and sportsbook partner of the Aces, marking the operator’s first partnership with a women’s professional sports franchise. Under the deal, BetMGM will receive commercial inventory on nationally televised games, rights to co-branded content across its digital and social platforms and WNBA tickets for VIP customers. 

“This initiative is a beautiful example of what can happen when business, sports and community merge together,” said Nikki Fargas, president of the Aces. 

The Aces play their home games at Michelob ULTRA Arena at Mandalay Bay Resort and Casino, a property that is home to an expansive BetMGM sportsbook.  

In the relatively near future, BetMGM plans to release a WNBA-branded online slot game in jurisdictions where its iGaming platform is live, the company announced. The product represents BetMGM’s first WNBA online casino game. The partnership will run through 2027. 

“As we enter this era of tremendous growth in women’s sports, BetMGM could not have two better organisations to partner with than the WNBA and the Aces,” said BetMGM CEO Adam Greenblatt. “Not only do the Aces play in our backyard at Mandalay Bay, but they share our commitment to giving back to the community.”

Indiana seeks to remove ‘duplicative’ sports betting regulations

One day after taking office in January, Indiana Governor Mike Braun signed two executive orders aimed at reducing or eliminating burdensome costs for small businesses. Now, months later, the Indiana Gaming Commission is taking advantage of the orders to ease licensing requirements on sports wagering registrants.

Beginning 1 July, the IGC will no longer enforce a requirement that sports wagering operators can only conduct business with licensed sports wagering registrants. 

The proposed amendment is expected to save thousands of dollars for market participants collectively. The impact will likely be felt most by payment processors, marketing firms and others that manufacture sports wagering support systems.

At the same time, the IGC will eliminate the state’s sports wagering registrant licensure requirement and associated fees, the commission wrote on its website. Since 2020, total fees collected by the IGC have averaged around $60,000 a year, according to IPB News, which first reported the story. 

Onerous regulations

At present, there are nearly 600 companies that are licensed with the state as sports wagering registrants. The commission requires sports wagering service providers to pay a non-refundable licensing fee of $10,000. For sports wagering registrants, the fee is much less at $500 per applicant. 

Key persons and substantial owners for SWSPs and registrants will not require licensure, according to the commission.

The proposed amendments are pursuant to Executive Order 25-17 on reducing regulation, as well as Executive Order 25-18 on professional licensing deregulation.

The new licensing requirements will be implemented pending an administrative change. Elsewhere in Indiana, the Pacers’ odds to win the Eastern Conference Finals moved to -370 on Thursday night after a Game 5 loss to the Knicks.

Indiana still has two chances to advance to the NBA Finals for the first time since 2000. A few astute bettors are sitting on a large payout, with ECF futures placed at the start of the season. Indiana opened the regular season with odds of +5000 to win the NBA title, placing the team around the middle of the pack in futures’ prognostications.  

DraftKings lone defendant left in MLB Players Union suit

After reportedly securing settlements with the majority of sportsbook operators in a lengthy name, image and likeness dispute, the MLB players union faces only one remaining hurdle in the months-long litigation.

Last September, MLB Players Inc filed a lawsuit against DraftKings and Bet365 in federal court in Pennsylvania claiming the companies misappropriated the likenesses of hundreds of players without their personal consent. MLBPI also filed suit against Underdog and FanDuel in New York state court.

Of the four companies, it appears that only litigation against DraftKings remains unsettled. The players union dropped a suit against Underdog on 20 May.

On Tuesday, a federal judge set a deadline on pretrial memos for both sides. The parties have some time, as the deadline will not expire until next April. In March, US District Judge Karen Marston rejected DraftKings’ motion to dismiss the case. On the same day, reports surfaced that the union dismissed its lawsuit against Bet365.

Months earlier, FanDuel and MLB Players agreed to voluntary dismissal of the lawsuit with prejudice. The designation indicates that the suit cannot be refiled. 

Legal interpretation on rights of publicity

In the September lawsuit, attorneys for the union argued that DraftKings used the players’ likeness as a mechanism for generating revenue by placing images of the baseball players next to a variety of sports wagers. 

“These bettors do not consider a player’s picture when making their bets, as an image cannot convey any relevant statistics about said player or their condition, and therefore does nothing to improve their understanding of the bet and does not impact their decision-making process in any way,” union attorneys wrote. 

Earlier this spring, DraftKings filed a motion to certify an order for interlocutory appeal, or a non-final order with the court. In civil matters, a judge may rule on such appeals during the normal course of court proceedings. In a 14-page brief, Marston applied a four-prong test to evaluate whether the court could certify the order for appeal.

The judge found that MLBPI “plausibly alleged” that the sportsbook operator violated the publicity rights of the players, noting that the players’ NIL rights were properly assigned through a sublicensing agreement with the union. 

She also analysed questions on whether a cause of action can be dismissed in a “right of publicity” case when there is no relationship between the parties.

While Marston ruled that the question presented a “closer call” for the court, she determined that DraftKings did not establish that an immediate appeal would materially advance the litigation. The judge set a trial date for 12 May 2026.

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During the brief appearance, the NGC granted a licence to Paige Farwell Fertitta, the former wife of the Houston Rockets owner. Last month, the US Senate confirmed Tilman Fertitta’s nomination as US ambassador to Italy and San Marino. After he pledged to step aside as president and director of Fertitta Entertainment, the NGC approved the promotion of his former wife to both positions with the company.

The NGC also broached Fertitta’s investment in Wynn Resorts hours before the commission approved a $5.5 million fine against the casino. Last November, Fertitta increased his stake in Wynn to 9.9% when he became the company’s top shareholder.

No updates on a key SEC filing

Fertitta’s eponymous Fertitta Entertainment has vast operations. In addition to the Rockets, the American holding company’s portfolio includes prominent restaurant brands such as Landy’s Inc, Rainforest Cafe and Del Frisco’s. On the gaming side, Fertitta Entertainment operates three casinos in Nevada, including the Golden Nugget in Downtown Las Vegas.

In February, Wynn Resorts released a Form 3 filing from the US Securities and Exchange Commission describing Fertitta’s ownership stake. According to the February filing, Fertitta owned 10.9 million Wynn shares and also had the right to buy 1,683,500 shares of common stock at $85.73 per share.

The option expired on 13 May. In a subsequent filing, Fertitta disclosed ownership of 12,600,000 shares in Wynn as of 25 March. The holding amounts to an 11.8% ownership stake in the company. At last week’s NGC hearing, Commissioner Brian Krolicki pressed Steve Scheinthal, general counsel at Fertitta Entertainment, on whether the company has filed a Schedule 13D on the Wynn stake.

A 13D is a filing that details a large stock purchase. Typically, passive investors are unable to file a 13G with the SEC and instead must file a 13D. The latter may be indicative of an attempt at an acquisition.

“Nothing has changed,” Scheinthal said with a hearty laugh. “Fertitta Entertainment and Tilman remain a passive investor.”

Billings on UAE: A substantial market opportunity

Wynn Resorts this month pulled out of the bidding process for a Downstate New York casino licence. The withdrawal could enable Wynn to devote more resources to its project in the United Arab Emirates, the Wynn Al Marjan Island casino resort. Speaking with CNBC in March, CEO Craig Billings indicated that the UAE market could eventually fall within a range of $5 billion to $8 billion in annual gross gaming revenue. The amount, Billings noted, is in line with revenue output on the Las Vegas Strip.

CBRE analyst John DeCree released a research note last November shortly after Fertitta disclosed a new stake in Wynn. In the note, DeCree addressed speculation that Fertitta could pursue a controlling stake given the entrepreneur’s investment in several major restaurant chains.

However, DeCree emphasised that Wynn would be a more “complicated and expensive endeavour”, considering its sizeable enterprise value and international expansion. The analyst specifically alluded to the company’s project in the UAE to illustrate his point.

The Senate confirmed Fertitta’s nomination as US ambassador to Italy by a vote of 83-14. Days later, on 6 May, Fertitta presented his credentials to Italy’s president, Sergio Mattarella. Fertitta is estimated to have a real-time net worth of $10.9 billion, according to Forbes, which ranked him No 241 on its list of world billionaires.

Wynn traded at around $92 a share on Wednesday, down fractionally on the session. While Wynn is up about 11% over the last month, the stock is down roughly 2% over the last 52 weeks.

Beset by a wave of departures, the US Commodity Futures Trading Commission will undergo a further transition period in the coming months.

Speaking at an appearance on 16 May in Amsterdam, CFTC acting Chair Caroline Pham announced that she will leave the agency when Brian Quintenz is confirmed by the US Senate. Following Pham’s announcement, Kristin Johnson, a Democratic commissioner, indicated days later that she plans to leave later this year.

In the sports betting industry, the CFTC has gained attention in recent months due to a high-profile case involving prediction markets on sports. Kalshi, a popular prediction market, has been subject to a wave of litigation on the state level.

Since late March, Kalshi has won two preliminary injunctions that have allowed the company to continue to offer event contracts on sports in New Jersey and Nevada. Separately, the CFTC dropped an appeal against Kalshi in a federal case involving election betting contracts. 

The departure of Pham and Johnson will leave only one member on the five-person commission. By month’s end, two other commissioners – Summer Mersinger and Christy Goldsmith Romero – will also leave the CFTC. Bloomberg first reported Johnson’s departure on 21 May. 

Last month, the CFTC delayed a highly anticipated roundtable on prediction markets without providing an explanation. In February, Pham wrote in a statement that certain anti-innovation policies have restricted the CFTC’s ability to “pivot to common-sense regulation of prediction markets.” Earlier this week, InGame reported that the CFTC will hold a conference call with tribal gaming leaders regarding prediction markets on 29 May. 

Kalshi announced a content deal with Elon Musk’s xAI on 20 May, before reneging on the partnership later in the day. Quintenz, a former CFTC commissioner, currently serves as a member of Kalshi’s board of directors. Kalshi has also appointed Donald Trump Jr to the board. 

Tush Push avoids ban, Lions table playoff rule change

Heading into this week’s NFL Owners’ Meetings in Minneapolis, the future of the “Tush Push” appeared on shaky ground. 

Needing 24 votes to permanently ban the short-yardage, scrum-like play, a contingent of league owners were poised to pass the rule change at Wednesday’s meeting. The proposal had garnered considerable media attention throughout the off-season. But the effort fell just short of the requisite votes, as the measure failed by a 22-10 margin, ESPN reported. 

Contending that the play is responsible for player-safety issues, the Green Bay Packers petitioned the NFL to penalise teams for running the push in short-yardage situations. Armed with one of the most prodigious offensive lines in recent memory, the Philadelphia Eagles have executed the push to near perfection. 

According to ESPN research, Philadelphia and Buffalo ran the play 163 times over the past three seasons. The amount is more than the rest of the NFL combined. When the two teams ran the push, they converted on a first down or a touchdown at a rate of 87%, ESPN found. Despite the outcome, the Eagles’ odds to repeat as Super Bowl champions remained unchanged on Wednesday at +650. 

Also at the meetings, the Lions withdrew a proposal that sought to re-seed playoff teams by record. At the moment, division champions receive a home game in the Wild Card round.

Under the proposal, the Vikings (14-3) would have opened the 2024 playoffs at home despite finishing second in the NFC North. The Lions pulled the proposal due to a lack of support.

Moore signs Maryland OSB tax hike into law 

Maryland Governor Wes Moore signed a bill on Tuesday that will bring a higher percentage of online sports betting revenues to the state.

With the tax hike, Maryland joins Illinois and Ohio among states that have approved tax increases since legalising sports betting. Filed as House Bill 352, Moore signed the Budget Reconciliation and Financing Act of 2025 into law this week. Under the bill, Maryland increased the tax rate on sports betting gross gaming revenue from 15% to 20%. 

A portion of the tax proceeds, specifically 5% from an operator’s mobile sports wagering GGR, will now be directed into the state’s general fund. The remaining amount will fund initiatives associated with education. The tax rate on retail sports betting will remain at 15%. Since December 2021, more than $160 million in legal sports wagering tax revenue has gone to the state’s Blueprint for Maryland’s Future Fund. 

Sportsbook operators could have been hit harder. At first, Moore’s administration pushed for a doubling of the tax from 15% to 30%. Instead, the House Ways and Means Committee passed an amended bill by a vote of 13-5. Last year, Ohio and Illinois approved tax rate hikes on sports betting revenue. At present, Ohio is considering another tax increase. 

During the current legislative session, legislators in North Carolina and Louisiana have also held debate on lifting their respective rates. In Colorado, Governor Jared Polis signed a bill into law that will eliminate deductions on sportsbook promotions across the state.

Previously, operators could deduct 2.25% of the value of promotional non-cash wagers placed by bettors. The deduction will sunset on 1 July 2026. 

Vegas man sentenced to five years for running Ponzi scheme

An Ohio judge sentenced a Las Vegas man to 65 months in prison on Wednesday in connection with running a sports betting Ponzi scheme that bilked investors out of millions of dollars.

Matthew Turnipseede received the penalty months after pleading guilty to four counts of wire fraud. According to the indictment, Turnipseede operated a scheme that promised investors double-digit profits through a variety of sports wagering businesses.

The defendant ran multiple sports betting companies, namely Moneyline Analytics and Edgewize, LLC. Turnipseede, according to prosecutors, enticed investors with false promises that his proprietary betting algorithm could generate returns in excess of 10%. Turnipseede was indicted in 2022 on 13 counts of defrauding 72 investors of more than $8.5 million. 

The defendant’s claims were persuasive enough to convince a mathematician and author of multiple academic papers on sports wagering to join his venture. According to court filings, Turnipseede also deceived a 72-year-old female investor, who is currently battling cancer. The unnamed woman, who retired in 2021, wrote in a victim impact statement that she now needs to return to work because of the lost funds. Prosecutors later determined that Turnipseede bilked investors out of $7.4 million, down about $1.1 million from the 2022 indictment. 

According to the indictment, Turnipseede used investor funds to pay for personal expenses, including family vacations to Disneyland and Hawaii, spa treatments and lease payments on multiple vehicles.

The court also required Turnipseede to pay restitution of $4.7 million. Turnipseede is scheduled to surrender to federal authorities within 90 days from the date of his sentencing. 

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At Thursday’s hearing with top brass from Wynn Las Vegas, NGC Commissioner George Markantonis wore his emotions on his sleeve. Depicting the allegations from a six-count regulatory complaint as a “body blow” to the reputation of the company, Markantonis did not mince words in his prepared remarks. A former president of Las Vegas Sands, Markantonis went one step further, describing the charges as a blow to the commission itself. Tested by critiques of perceived leniency in two other cases this year, Markantonis and the NGC had a chance to make amends.

Then about 29 minutes later, Markantonis spent little time in contemplating his decision. A neophyte on the NGC, Markantonis joined three other commissioners in approving a stipulated settlement with Wynn. Upon the completion of a tense 90-minute hearing, the NGC voted 4-1 to approve the Nevada Gaming Control Board’s (NGCB) $5.5 million settlement with the company.

The complaint stems from a September 2024 non-prosecutorial agreement with the Justice Department. Under the NPA, Wynn forfeited $130 million to settle allegations that it conspired with unlicensed money transmitting businesses worldwide to transfer funds for the financial benefit of the casino. The settlement is the largest of its kind by a casino with the federal government.

Just one commissioner, 2019 appointee Rosa Solis-Rainey, voted against the settlement. In explaining her decision, Solis-Rainey described the amount of the settlement as comparatively low relative to the severity of the allegations.

Millions in transactions

Solis-Rainey called attention to an individual who operated, managed or supervised multiple unlicensed and unregistered money transmitting businesses in the US. According to regulatory and court filings, the individual conducted more than 200 transfers with bank accounts controlled by Wynn Las Vegas or associated entities. In total, the individual conducted transactions on behalf of no fewer than 50 casino patrons, amounting to $17.7 million, prosecutors allege.

While the individual was not mentioned by name at Thursday’s hearing, the fact pattern comports with charges against Juan Carlos Palermo, an Argentinian national who reached a plea agreement with US federal prosecutors in 2022.

Over a nine-year period through 2020, Palermo and his unlicensed money transmitting business transacted with clients in at least 15 countries abroad, including Hong Kong, the United Arab Emirates and the Cayman Islands. The NGCB referenced Palermo, an independent agent of Wynn Las Vegas, seven times in the 48-page complaint.

Palermo’s business enabled clients to conduct international monetary transfers through a series of underground financial networks while circumventing laws and regulations regarding monetary transfer in the US, prosecutors stated.

In March 2018, Palermo transferred $200,000 from a bank in Uruguay to an account he managed in the US. Four years later in federal court in California, he accepted a deferred prosecution agreement from the government.

All told, the conspirators steered no less than $130.1 million in financial transactions through the money transmitting businesses, according to court files.

Blacklisted entities

In a statement released by Wynn Resorts, the company took responsibility for the violations but asserted that the improper actions were undertaken by several rogue employees. Moreover, Wynn claimed the company “severed ties” with the employees years ago, while fully complying with the investigation. During Thursday’s hearing, attorneys for Wynn told the commission that at least six employees implicated in the investigation are no longer with the company.

On 24 June 2014, Wynn Las Vegas rejected an independent agent’s attempt to transfer funds anonymously through a third-party entity. Wynn apparently rejected the transaction because it originated from a “furniture company” that had wired money for 35 other Wynn patrons, according to court records.  

By 4 July, however, the independent agent, acting again as an unlicenced money transmitting business, used a different third-party entity to wire funds to the casino. This time, Wynn accepted the transfer.

Eric Aldrian, chief litigation counsel for Wynn Resorts, provided some clarity on the transactions at Thursday’s hearing. At the time, Wynn policy allowed independent agents to pay off outstanding markers on behalf of their patrons, a practise also permissible under state law, Aldrian noted.

“The 200 transactions were absolutely seen to us, they were visible and they did not skirt our AML programme,” he told the commission.

A longstanding business relationship

By 2015, Wynn Las Vegas blacklisted two entities utilised by the independent agent to facilitate the transactions, he added. Nevertheless, the agent continued to conduct business with the casino through a Bank of America account located in Florida.

The agent used the bank to facilitate transactions with Wynn until April 2021, when the company learned that he charged a 6% commission to patrons.

The unsavoury practise took him from his status as an independent agent and “into the realm” of being an unlicensed money service business, Aldrian contends.

By definition, a money transmitting business is one that accepts currency or funds denominated in the currency of a country and transmits the funds through a financial agency, financial institution or an electronic funds transfer network. Federal prosecutors included the definition in the September 2024 NPA with Wynn Las Vegas.

Solis-Rainey criticised Wynn staff for the failure to detect the series of suspicious transactions. She also criticised the company’s decision to conduct business with the agent for six additional years after blacklisting the two entities.

Failure to identify suspicious activity

Palermo was not the only independent agent who transacted with Wynn over the last decade. In 2018, Wynn Las Vegas facilitated financial transactions worth approximately $1.4 million for a former gambling representative who had been publicly linked to proxy gambling, according to court records.

A year earlier, US authorities denied the individual entry into the country due to his suspected association with a transnational criminal organisation. Despite awareness of potential suspicious activities, Wynn never filed a retroactive Suspicious Activity Report on the individual, according to prosecutors.

In another instance, Wynn Las Vegas allowed for international monetary transactions of millions of dollars from an individual who spent at least six years in a Chinese prison in connection with unauthorised financial transfers, prosecutors alleged.

Flying Money and Human Hat schemes

The complaint also detailed several other methods that the company utilised to further the conspiracy. The conspirators engaged in one plot known as a “flying money” scheme where a money processor acting as an unregistered money transmitting business would be introduced to a Wynn international patron who could not readily access cash in the US.

The introduction would typically be made by the patron’s host, whose job it was to facilitate the patron’s play at Wynn. In turn, the money processor would collect US dollars from a variety of third parties and deliver that cash to a Wynn patron, according to prosecutors.

Another violation surrounds so-called “human hat,” or “human head,” gambling. The practise simply involves a gambler serving as a proxy for an individual who is prohibited from gambling by the casino. In some cases, the banned individuals stood mere feet from the proxy, offering instructions on how to gamble without physically handling the chips.

In another documented case, Wynn Las Vegas allowed for the international transfer of millions of dollars by an individual who reportedly took part in “human head” proxy gambling, according to prosecutors. Solis-Rainey took Wynn to task for not spotting instances of proxy betting on the casino floor.

The trilogy

The hearing on Thursday marked the third time that the NGC has convened in recent weeks to discuss a stipulated settlement involving a major Strip property. In March, the NGC approved a $10.5 million fine against Resorts World Las Vegas for a slew of AML deficiencies. RWLV accepted the fine, but it neither admitted nor denied the proposed violations.

The conduct at RWLV involved allegations against Matt Bowyer, the bookmaker of choice for Ippei Mizuhara, the former interpreter for Shohei Ohtani. Mizuhara wagered at least $325 million with Bowyer’s illegal sports betting ring, incurring net losses of $40.2 million. Weeks later, the NGC convened again to approve a settlement with MGM Resorts.

Bowyer again played a role in the settlement, amid allegations that he gambled at MGM at least 300 separate times even though casino officials knew of his occupation as an illegal bookmaker. Unlike RWLV, MGM expressed contrition for the violations accepting full responsibility for the infractions. MGM accepted an $8.5 million fine, $2 million less than the one given to RWLV.

Last week, Jeff Mitchell, the lead prosecutor in the Bowyer and Mizuhara cases, left the US Attorney’s Office for the Central District of California.

A distinction from the others

Attorneys for Wynn Resorts argued on Thursday that the facts of the case differed considerably from the two preceding ones. The settlement with the Justice Department pertains to violations of Title 18, United States Code, Section 1960, on unlicensed money transmitting businesses, they noted.

While the others had a direct relationship with matters under the Bank Secrecy Act (BSA), the Wynn settlement was not a BSA case, said Erica Okerberg, outside counsel for the company. In the case of Wynn, regulators did not accuse the casino of transacting with illegal bookmakers. Okerberg outlined a host of remediation plans by Wynn to mitigate the risks of future violations.

Notably, there were no allegations that any individuals laundered money through Wynn Las Vegas, said Nona Lawrence, a Nevada deputy attorney general. In layman’s terms, Lawrence described money transmitting businesses at well-known financial services companies such as Western Union and Moneygram. Money transmitting businesses can legally operate in the US providing they abide by state and federal laws, including the BSA.

Next steps

While Thursday’s settlement closes a dark chapter in Nevada gaming history, the sweeping investigation is by no means complete. Three bookmakers, Wayne Nix, Damien LeForbes and Bowyer, still await sentencing. The NGC also delayed action against Nicole Bowyer, the wife of the bookmaker. Regulators accused Bowyer of receiving commissions on her husband’s play as an independent agent of RWLV.

In a separate matter, the NGC also granted a temporary licence on Thursday to Maurice Wooden, president of the Fontainebleau Las Vegas. At the hearing, the NGC asked Wooden if he had any knowledge of a potential AML investigation against the casino. The questions surround credit transactions involving at least five Fontainebleau customers. NGCB Chairman Kirk Hendrick contended that the materials pertaining to the matter should have been marked as confidential.

“AML is one of the most important topics, if not the most important, we discuss in our leadership meetings,” Wooden said.

While Markantonis appeared to be the most animated of the commissioners on Thursday, others came close to denying the settlement. Commissioners Abbi Silver and Brian Krolicki hinted that the fine may have been too low.

Irked by the patterns of noncompliance, Markantonis is concerned that the NGC may be perceived as being too soft against the largest casinos on the Strip. He referred specifically to critiques that the “big boys” may only receive “a slap” on the wrist for major infractions.

“We are not taking prisoners anymore, enough is enough,” he said. “The BS is over, it doesn’t matter how fancy your title is.”

For founders, investors and dealmakers, understanding these macro undercurrents isn’t optional – it’s essential for timing exits, raising capital and getting ahead of the next cycle.

In this piece, we explore the macroeconomic forces shaping capital accessibility, valuations and M&A appetite in the iGaming sector. Despite the uncertainty, there’s a strong argument that this could be one of the best windows we’ve seen in years.

Tariffs are a sideshow, liquidity is the main event

The recent flare-up in US-China trade rhetoric has reignited tariff concerns, particularly for land-based gaming businesses sourcing hardware from China. But, for iGaming firms, the impact is more psychological than operational. It’s market volatility, not component costs, that matters.

Some analysts argue the tariff taunts are more tactical than economic, designed to destabilise markets just enough to justify rate cuts. Whether intentional or not, the market’s reaction may be setting the stage for a liquidity pivot and that’s where things start to matter.

While tariffs might slow shipping lanes, it’s bond markets, interest rates and central bank balance sheets that ultimately drive iGaming capital flows.

The $9 trillion problem and the dollar diplomacy behind it

The US is facing a refinancing wall: Over $9 trillion in government debt is set to mature within the next 18 months. With interest costs already eating into federal budgets and bond markets starting to show signs of stress, pressure is mounting on the Fed to ease financial conditions. That could mean more rate cuts, renewed QE, or indirect forms of liquidity support.

But beyond the domestic playbook, there may be a deeper strategy unfolding. This is about more than balance sheets; it’s about preserving the dollar’s dominance. Much like Kissinger’s petrodollar agreements of the 1970s, there’s a case to be made that trade policy, geopolitical leverage and financial diplomacy are being quietly used to encourage foreign uptake of US treasuries.

The aim? Spread the debt load more evenly across global balance sheets and ensure that future treasury auctions aren’t met with silence. In doing so, the US can buy time, maintain funding flexibility and, crucially, avoid a default.

This matters for iGaming because these dynamics shape the backdrop for capital markets. If the strategy holds, we could see renewed investor risk appetite, lower rates, and a more accommodating environment for M&A. If it breaks… please throw me a life raft.

Liquidity: The invisible driver of valuation

Global liquidity reached record highs earlier this year, driven by central bank support and a softer US dollar. Historical cycles suggest we’re now in the latter stages of this liquidity wave, which typically peaks every five to six years.

Liquidity drives sentiment and sentiment drives valuations. There’s usually a three-month lag between liquidity changes and asset performance, so the recent uptrend may still have further to run.

But warning signs are emerging. US tax outflows have drained treasury cash accounts. The Fed has slowed its injections. China’s central bank is tightening to defend its currency. And rising bond volatility is increasing collateral requirements, effectively shrinking leverage.

In simple terms, the window is open, but it won’t stay that way forever.

For iGaming founders, this may be the moment to move

Macroeconomic shifts might seem abstract, but they’re already influencing how capital is priced, how buyers engage and what kind of deals get over the line.

Capital is more expensive. Even for firms without direct bond market exposure, financing through revolving credit facilities, convertibles or bank loans is tightening as interest rates remain elevated and geopolitical tensions persist.

• Buyers are more disciplined. The era of speculative M&A has passed. Deals now require clear value drivers and credible integration paths.
• The heyday valuations of the post-Covid boom are unlikely to return anytime soon – serious sellers need to price for today’s market, not yesterday’s.
• Strategic acquirers have the advantage. Companies with fat balance sheets can transact without relying on leverage.

The key takeaway? Strong assets are still getting strong terms. If you’ve invested in preparation, your timing may be perfect.

M&A momentum: Sentiment check for 2025

The iGaming sector saw robust deal flow throughout 2024, with around 50 transactions inked. However, a more cautious tone emerged in the first quarter of 2025, as shifting market sentiment and increased volatility caused some buyers to temporarily pause. Many of these transactions should regain momentum once market confidence returns.

Affiliate consolidation has been relatively quiet compared to activity among operators and suppliers, impacted by external headwinds including Google’s algorithm shifts, regulatory changes in Brazil, tighter cookie-tracking restrictions and growing issues with parasitic traffic.

Despite these pressures, the affiliate model remains fundamentally robust, especially within privately held businesses, many of which continue to show resilience and adaptability. The long-term outlook for quality affiliate assets is still positive, with growth expected to resume as businesses adjust to evolving market conditions.

Strategic deals continue, although often quietly and off-market. Buyers with conviction remain active behind the scenes, making strategic preparation and clear market positioning more critical than ever.

Regulation: Rewriting the map

Alongside macro, regulatory dynamics continue to reshape global iGaming flows.

• Brazil and South America remain attractive markets due to their increasing regulated footprint and a land-grab is still in play to be ready for the 2026 World Cup.
• The US market’s state-by-state rollout is lacklustre, but plenty of money is still being made in sweeps.
• The UK’s spring budget passed without mentioning gambling reform. That silence may indicate continued stability.
• Thailand is exploring regulation. So are several other Southeast Asian markets.
• UAE’s emerging regulatory framework positions it as the next significant frontier.
• India is a sleeping giant.
• Unregulated and crypto-fuelled platforms are booming. Operators in over-regulated jurisdictions like Germany, the Netherlands and parts of the US are increasingly drawn to sweepstakes and crypto casino models.

For founders, understanding where regulatory tailwinds or constraints exist can make or break the narrative.

So, what’s the trade?

Here’s how we see it:

1. Liquidity remains elevated. This supports risk assets in the short term.
2. Quality will be rewarded. Capital hasn’t disappeared; it’s just more discerning.
3. Inflation risk is real. If inflation spikes again, the Fed may be forced into hawkish territory, tightening conditions quickly.
4. The fundamentals of iGaming are intact. Recurring revenue, global expansion and digital scalability continue to attract serious attention.

The landscape is shifting. But for those who are ready, it’s not a threat – it’s an edge.

Final thought: Position with purpose

Yes, things look calm – April’s inflation read was 2.33%. Markets are climbing. Liquidity is flowing. But under the surface, risks remain. Inflation could return. Treasury demand could weaken. The Fed’s balancing act is delicate.

Still, we’re optimistic.

“We’re not fully deployed, but we’ve invested more in the last six months than we have in years. That should tell you something.”

For founders thinking about growth, capital raises, or an exit, this may be your window. And for the right companies, that window could open even wider in the months ahead.

Preparation beats prediction. Always.

Entrepreneur, investor and strategic advisor of multiple high-value igaming & sports betting/fintech/media businesses, with over 25 years of commercial & stakeholder management experience across the igaming, payments, technology and media sectors.

Ben entered the igaming industry in 2009, leading a global publishing business. Subsequently, he led the EMEA rollout of a crypto-payment business, co-founded and exited a crypto exchange and, since establishing RB Capital in 2014 & Corfai in 2023, has completed more than 20 successful transactions and raised millions in investment capital.

This bizarre push appears to be founded on a collective amnesia over the fact the current government not just inherited, but supported, the 2023 white paper review and its proposals, which are only now coming into force.

It’s sometimes easy to forget how seminal the white paper really is, comprising 62 measures impacting all areas of the market. It was rightly described as a “once in a generation” reset for the sector, widely welcomed for balancing customer freedoms while increasing protections for the minority for whom gambling is problematic.

£100 million boost for RPT from statutory levy

Much has happened so far. From 6 April, the statutory levy came into place, aiming to generate £100 million ($134.1 million) a year for research, prevention and treatment (RPT) to tackle problem gambling and gambling-related harm.

Funding will be received by the Gambling Commission by 1 October to cover the 2025-26 levy period, while UK Research and Innovation, the Office for Health Improvement and Disparities and the NHS will commission programmes and services across RPT respectively.

This will nearly double funding from the last year of the voluntary levy, transforming the RPT landscape. For operators the crucial question will be how this entirely new system is governed. So far there has been little detail on how these various bodies will address issues including conflicts, eligibility, transparency as well as how they propose to build trust in this new system.

The sheer volume of money is likely to catch the eyes of newcomers looking for grants. When that happens, it is vital that long-standing, expert RPT providers are not excluded from commissioners’ priorities. Better Change has produced a report which creates food for thought on how to go about governing this new, cash-rich system.

What impact will slot stake limits have on GGY?

There has also been a major overhaul of maximum online slot stakes. On 9 April a new £5 stake limit was introduced for over-25s, then on 21 May the £2 max stake for under-25s came into force. This will eliminate the previous regime of open-ended staking, although it should be noted average stakes across the market are already less than £2 per spin.

The government’s own latest impact assessment predicted this measure would deliver a £181 million hit to operator GGY. We will know by autumn if that prediction proves correct. How customers respond will be a key question, not from playing down to the limits, but whether they exit the regulated market altogether. It would be safe to predict a shift, but only time will tell how much.

Changes to marketing regulation in the UK

On 1 May new direct marketing rules came into force under updated Gambling Commission licence conditions and codes of practice regulations. These reopen the choice architecture for operators, allowing customers to submit their preferences for products and channels for the purposes of direct marketing.

Hot on the heels of this will be a further set of marketing rules which restrict the number of plays required for redeeming bonuses and prevents inducements for different products being tied together. All of this will have an impact on advertising distribution.

Waiting in the wings are land-based casino reforms which address outdated machine allocation rules and allow all venues to provide a sportsbook. These are working their way through parliament now and will come into force in early summer.

These are just a handful of the changes coming into force throughout 2025, but there is a host more to come next year involving legislation, agreements between counterparties plus Gambling Commission measures.

Further gambling regulation would undermine the white paper

The government predicted the white paper’s impact on GGY for the online sector would be between £584m and £914m. It could be more, but that won’t become clear until all the measures are in place and a methodology of measurement is agreed and completed. NatCen has already been appointed as the main evaluator, but there is little transparency on how it will go about its work. What will be the base year? And how will it calculate displacement to the black market, which has to be considered regardless of how challenging it is to measure.

The reality is, the white paper is having a huge impact on the market and will do so for years to come. Calls for further restrictive measures before it is even fully implemented, much less come into force, would ignore and undermine five years of work striving for the political and policy balance the white paper promised.

‘Once in a generation’ should mean exactly that

And even if some have “banked” the white paper, this does not mean there is now a void of further work in the gambling space. The Advertising Standards Authority is already reviewing their less-than-two-year-old rules on “strong appeal” and the use of celebrities in gambling marketing.

The Information Commissioner’s Office has launched an investigation into cookies and tracking. The Gambling Commission has launched early reviews of fair and open terms while the treasury, not to be left out, has published a consultation on creating a single new online gambling tax.

The gambling space, despite being just a sliver of the overall UK economy, seems to command a disproportionate amount of attention. And it is this attention which roils the waters of policy and clouds the horizon for operators desperate for a sense of normality.

It would be wiser to take a breath once the white paper and its evaluation is completed, if only to give business some relief from the upheaval of a massive body of regulatory intervention. The need to enhance consumer protection goes on, but when it comes to regulations, once in a generation needs to mean just that. There is no need to review the Gambling Act again – policy is set and the industry should be allowed to deliver it.

Wes Himes is a Partner at Intrepid Partners and Senior Adviser at the Betting and Gaming Council (BGC).

Mizuhara, the disgraced former interpreter for Shohei Ohtani, is something of a pariah in Japan, where the Dodgers baseball star is viewed as a national hero. In February, Mizuhara received a lengthy sentence in connection with embezzling at least $17 million from Ohtani to feed his gambling habit. Born in Tomakomai, a port city on Japan’s second-largest island, Mizuhara may face deportation from the US following his prison stay.

Back in Japan, where baseball is the national pastime, the rate of illegal sports gambling apparently has been soaring. Last year, citizens of Japan placed approximately ¥6.45 trillion ($44.6 billion) in overseas sports wagers even though the sites are illegal, according to a report from the nation’s Council for Sports Ecosystem Promotion. While the market has grown considerably, arrests for gambling-related offences are still minimal, according to the CSEP, which on 14 May published findings of a comprehensive investigation.

The rapid growth in sports betting in Japan shows little signs of abating. Of the vast amounts wagered offshore, approximately ¥1 trillion consists of bets involving domestic sports in Japan, the investigation found. That huge volume raises questions about sports gambling habits in Asia’s third-richest country.

A black eye for Japanese baseball

The report was issued several weeks after two members of the Yomiuri Giants were referred to prosecutors for allegedly gambling on illegal online casino sites.

The two players, Luis Okoye and Daiki Masuda, lost millions of yen on online games such as baccarat and blackjack. Okoye, a nine-year veteran, has 14 career home runs and a batting average of .226 since joining the Nippon Professional Baseball league in 2016. The outfielder wagered about ¥7 million on online casino games, producing a negative balance of around ¥4.5 million, according to Mainichi Shimbun, the nation’s largest daily newspaper.

Amid a league investigation, the NPB accused 14 players across seven teams of engaging in illegal gambling in February.

Reminders of the ‘Black Mist’ scandal

The Yomiuri Giants garnered headlines in 2015 when several players admitted to betting on baseball. According to the club, pitcher Shoki Kasahara wagered on 10 pro baseball games, while also betting on baseball at high school level.

The team also accused another pitcher at the time, Ryuya Matsumoto, of wagering on at least 10 games over a four-month period. While both pitchers admitted to wagering on baseball, they were not accused of betting on games involving their own team. A third player, Satoshi Fukuda, also admitted to wagering on high school games.

The trio also admitted to betting on MLB games in the US, according to The Japan Times. While no evidence emerged that the players engaged in match-fixing, the Times reported that the probe examined possible links to organised crime. The gambling violations took place nearly 50 years after the “Black Mist scandal“, in which several Japanese players accepted money from the famed Yakuza syndicate to fix a series of games.

Illegal markets dwarf sports lottery betting

Today, there are clear signs that Japanese bettors are wagering heavily on domestic baseball on offshore sites.

Of all wagers, domestic baseball led the way with a 2024 handle of ¥528.1 billion, according to the CSEP report. The amount dwarfed soccer, the next highest at ¥333.4 billion, and basketball with ¥86.9 billion. Tennis ranked fourth, followed by a pair of niche sports in volleyball and rugby.

While horse racing is enormously popular in Japan, betting on most sports is heavily restricted.

Sports wagering in Japan is available legally on a limited basis through a government-run sports lottery. The options are sparse, with only minor sports such as motorboat racing and cycling available. Consequently, Japanese bettors wagered ¥133.6 billion on sports lotteries in fiscal year 2024, approximately 48 times less than the amount reportedly wagered offshore.

In soccer alone, Japanese bettors wagered trillions of yen.

Unprecedented wagering patterns by Ippei

The son of a chef, Mizuhara moved to Los Angeles as a young boy in 1991. He played goalkeeper on a varsity soccer team at Diamond Bar High School before returning to Japan to serve as an interpreter for the Hokkaido Nippon-Ham Fighters.

There, he met Ohtani, a teenage prodigy for the NPB team. Besides working as Ohtani’s interpreter, Mizuhara became a close confidant of the Japanese star, serving as his catcher in bullpen sessions, preparing lavish meals and forging a bond through frequent video game battles. Mizuhara followed Ohtani to the Los Angeles Angels in 2018.

In California, Mizuhara engaged in rampant betting patterns of extremely high wagers on the illegal market. Over a 37-month period, he placed approximately 19,000 wagers with an enterprise run by illegal bookmaker Matt Bowyer. Mizuhara incurred losses so severe that he had a net balance of negative $40.2 million when he severed his relationship with Bowyer.

His relationship with Ohtani came to a head in March 2024 when reports surfaced that Mizuhara wagered heavily on sports. The interpreter initially told ESPN that Ohtani had knowledge of his betting activity, but he later recanted the story.

Mizuhara had impersonated Ohtani numerous times in calls with bank officials to gain approval for six-figure wire transfers that went to Bowyer’s operation. Ruled a victim of massive theft by Major League Baseball, Ohtani has been cleared of all wrongdoing.

Mizuhara is now scheduled to surrender to federal prison authorities by 16 June.

The reaction on Japanese soil

A three-time MVP honoured in both the American and National League, Ohtani has ostensibly become the Japanese version of Babe Ruth in his native country. Returning home for the Tokyo Series in March, Ohtani crushed a 99mph fastball 389 feet for a solo home run.

Lauding Ohtani for blocking out the pressure of playing before a rabid home crowd, Dodgers manager Dave Roberts likened the two-way player to a superhero.

Ohtani has also placed the gambling scandal squarely in the rear view mirror. Days after reports surfaced on Mizuhara’s betting habits, Ohtani denied placing any wagers on baseball or on sports in general.

He went on to produce a record year in 2024 when he became the first player in MLB history to notch 50 home runs and 50 stolen bases in the same season. Last fall, he added three dingers in the postseason, en route to the first World Series title in his illustrious career.

Mizuhara, meanwhile, has received strident criticism in Japan for bringing Ohtani into disrepute. Taro Abe, a reporter who covers Ohtani for Japanese newspaper Chunichi Shimbum, told the Los Angeles Times that Ohtani is viewed as a victim who was hoodwinked by the interpreter. For a player viewed as almost “flawless”, there were practically no reports in Japan that cast doubt on Ohtani, Abe noted.

Natsuko Aoike, who covers the Dodgers star for Japan newspaper Tokyo Sports, described the scandal as a “major, major story”, on par with the media coverage of a presidential election. Even before the scandal, Ohtani typically garnered top headlines on a daily basis, Aoike explained.

A plan to combat illegal betting

Last month, MGM Resorts broke ground on MGM Osaka, an $8.9 billion casino resort planned in Japan’s second-largest city. The nation’s first gambling-related resort is projected to be finished by the fall of 2030, although there is no indication that sports betting will also become legal.

As illegal sports betting proliferates, many foreign countries have engaged in information-sharing initiatives with the Council of Europe as the base of operations, the authors wrote in the CSEP study. The initiative is based on the Macolin Convention, a legal instrument and the only rule of international law on sports manipulation.

While the Japanese council has formed a study group to discuss measures against illicit sports betting, the nation has yet to implement a system based on the convention, according to the CSEP.

Ben’s story is one of resilience and relentless determination. Today, his impact in the UK market is visible across 18 Star Sports shops, numerous racecourse pitches and a growing online presence through his brand, but also PricedUp, Planet Sport Bet and NRG Bet. He now employs over 300 staff.

Unlike the corporate giants, Ben is comfortable taking bets from just about anyone. He plays the man and bets to figures. In doing so, he has built a business that stands liabilities most would duck – making him a true outlier in today’s operator market.

Where it began

Ben’s journey started at Hove greyhounds. Barely a teenager, he was reluctantly dragged to the track – but a £2 winning Tote bet on Sara Jones, the spring of the traps, dust in the air and the roar of the crowd left an instant impression. He was hooked. From that night, he knew he’d found his calling. 

He quickly became the school bookmaker, taking bets from students and teachers on everything from school sports, to the next head boy. He washed cars on weekends to afford The Sporting Life and Racing Post and spent every spare moment in the betting ring – ferried from track to track by his father. Before his first day of work experience at Hove, his dad offered a parting line that stayed with him ever since:

“Take the good, leave the bad.”

Learn from the best

The betting ring became Ben’s university and the bookmakers were his professors.

One of the earliest was Martin “Lofty” Chapman, who taught him how to price a race, balance a book and communicate odds with tic-tac. Today, Chapman remains an integral part of the Star Sports team – a regular presence at pitches across the UK.

While still a teenager, Ben also gained experience at City Index, working in the sports spread betting division. There, he encountered Martin Johnstone, whom he later described as City’s “shrewdest and most successful punter”.

In his late teens, Ben would start watching Martin at work in Bournemouth. The chance to learn from someone who operated on both sides of the fence – as a pro punter and a bookmaker – was formative.

“He was the perfect example of both a professional punter and bookmaker.”

Missed opportunity

Ben returned to City Index, where he had previously been promised a full-time role once his A-levels were complete – thankfully, passing them wasn’t a condition. A couple of years later, a new spread betting job came up in Gibraltar, which he accepted. But, in Ben’s view, the venture wasn’t going anywhere fast.

His boss, however, might have been. He was working for a young Tony Bloom, who was already making money trading Asian handicap football markets. But that world held little appeal. So when he landed a £10,000 win on the aptly named Pension Fund, he handed in his notice the very next day to become an on-course bookmaker.

Asked if there were early signs of Bloom’s future success, Ben doesn’t hesitate: “Absolutely. Tony was a very professional and hard-working chap. I was just a complete idiot and nothing would have stopped me from going to become a racecourse bookie.”

Painful lessons

Ben launched his on-course business with a £10,000 float – but it didn’t last.

“I lost my float within weeks and spent the rest of my 20s suffering, being mocked and learning very hard lessons. It took years off my life with stress, while those who worked for Tony became immensely wealthy. I was a fool.”

His twenties were defined by trial and error. He kept going – falling, standing up again and pushing forward – with a high tolerance for risk.

“When you’re skint, you can play like a lion.”

One person who saw this hunger up close was Gary Woodgate, then behind the counter at the Ladbrokes in Brighton.

“Gary knocked back my team of putter-onners’ bets. I was a professional gambler. It was with this money I built a bookmaking business. My punting paid for my bookmaking mistakes, lessons and growth.”

Ben quickly recognised Gary’s skills complemented his own and, after a lunch discussing the vision, Gary joined him. He would go on to become Ben’s right-hand man.

Building a brand

The pair cut their teeth at Walthamstow dogs, building a reputation and slowly growing a shop business. The early days were tough. As newcomers, they were effectively fresh bait for sharp bettors and had to learn quickly to survive.

The turning point came with the rise of tele-betting – taking bets over the phone. Ben saw the potential early. Bigger punters started to find him and he moved to London to network and chase the action more seriously.

From day one, Star Sports focused on doing the basics right: paying winners promptly, accommodating large bets and building strong, personal relationships with customers. It sounds simple – but in today’s industry, it is rare.

Walk into a Star Sports shop today and you’ll be greeted by staff who know the game – and know their customers. Ask for a bet on the Derby and you won’t get a blank look.

The approach has given Ben the confidence to open shops in the most competitive locations, trusting that good service and well-kept shops – where bigger operators often fall short – will bring business his way.

“Go right amongst the competition. And compete on everything (except price).”

Customer acquisition

Star Sports has carved out a niche at the top end of the market. At Cheltenham and Ascot, they trade seven-figure positions and cater to high-value punters. Ben knows he can outdo the big corporates on-course and in the shops by offering a level of service that their scale simply can’t match. That connection between punter and bookmaker breeds loyalty – and puts rest to the idea that betting shops are a thing of the past.

His approach to acquiring and retaining customers is refreshingly traditional.

“Look somebody in the eye. Shake their hand. Give them your attention. What service do they want? Connect with them. If you can’t find punters in a betting ring and you’re a bookie, I’m afraid you’re in the wrong game”

Ben doesn’t deal in illusion. His edge is built on clarity – of people, of situations, of risk. His guard is never down.

“I like to look at the man. I like to see: How does he behave when things change? I like to break his stride – to see his reactions when plans go awry. If anything is hidden or unclear, I am worried. You must see what you are looking at.

“I have only fallen when hope and greed have got the better of me. A clever gambler will play to your greed to pull you in. He will throw out sprats to catch his mackerel. Stop believing. Start watching and listening.”

What’s next?

Scroll through Ben’s social media and you’ll find a man who is passionate about food, conversation and learning from others.

“I like to eat something different every night, with someone from a different demographic. A balanced diet, both in your tummy and mind, leads to a healthy body and soul.”

It is a philosophy that mirrors his broader view of the game: adapt or be outpaced.

“Gambling is the ultimate Darwinism.”

He’s also a devoted supporter of greyhound racing – and in 2021, he won the GWA Services to Greyhound Racing Award. While he continues to build Star Sports, his success is reflected through a growing property empire, having acquired over £150 million worth of assets across six countries (Source: Star Property).

“All of my money goes into property. One day, cleverer bookies will come along. When that happens – and the wave goes over – I want to have something to show for it.”

Power of the Network

Ben’s story is a reminder of what it takes to succeed in one of the toughest businesses around – where your customers are actively trying to put you out of business. He’s not just a bookmaker, but a sharp, driven entrepreneur.

At Waterhouse VC, we’re fortunate to have individuals like Ben in our network – people who bring deep insight, real-world experience and a willingness to help others navigate the complexities of the industry.

If you know any gambling tech companies seeking capital or distribution support, our new ‘Pitch Us‘ page makes it simple to connect with our investment team.

Waterhouse VC is a fund that specialises in global publicly listed and private businesses related to wagering and gaming sectors. The fund is only available to wholesale investors.

Since inception in August 2019, Waterhouse VC has achieved a gross total return of +3,133% (annualised at 84%), as at 30 April 2025, assuming the reinvestment of all distributions.

“A lot of people came to us as candidates, including some people from S-Tech who said they’d been made redundant,” Sennette Lam, CEO of the Malta-based recruiter, explains. Despite being good quality candidates with plenty of experience, they were suddenly facing redundancy and scouring the local jobs market.  

Scanning the pages of LinkedIn tells a similar story about redundancies in the industry: a sea of “Open to Work” banners and posts about iGaming professionals looking for new opportunities. While layoffs have been more common in the post-pandemic years, recruiters say there has been an even more noticeable upswing recently.  

“There are definitely a lot of redundancies at the moment, not just in specific markets but across the industry as a whole,” says Jennifer Innes, CEO of UK-based recruiter BettingJobs. Beginning in the aftermath of Covid-19, the past few years have spurred a dramatic rise in candidates who are forced to start polishing their CV.  

‘Emergence of new locations’ 

In the tight-knit offshore communities like Malta and Gibraltar, employees are feeling the shift more keenly. In these smaller jurisdictions, waves of layoffs can start to feel like cataclysmic changes in the employment landscape.  

The job cuts appear to be penetrating all areas of the industry, from operators to suppliers and even affiliates. Most notably, Malta-based Catena Media hit the news last week when it announced another round of redundancies to bolster profitability after poor results in Q1.

This year, around 50 jobs are being scrapped – on top of the 29 content and market roles the affiliate cut last November. At the time, CEO Manuel Stan had said he planned to “rule out” further layoffs, but a 40% drop in Q1 profit prompted a major U-turn. 

Catena isn’t the only one: In March last year, Gibraltar’s Gambling Commissioner Andrew Lyman admitted there had been a spate of redundancies on the peninsula, including at well-established brands like William Hill, Entain and Lottoland.  

Are iGaming hubs shrinking?

At the time, Lyman sought to reassure people that employees in gaming were usually quickly reabsorbed into the market. However, recruitment experts say the situation is more complicated than that.  

“Igaming hubs like Malta and Gibraltar are always going to be very important to the sector, but their importance recently has been somewhat diluted,” says Innes.  

“You’ve got the emergence of other locations like Bulgaria, Prague or Poland, or even the re-emergence of places like Cyprus. Then you’ve got people from Ukraine and Russia moving elsewhere since the start of the war. All these external factors are influencing the choice to hire or not to hire in Malta and Gibraltar.” 

This fragmentation can make life more complicated for employees in these offshore hubs who find themselves facing redundancy. Whereas many jobs in the gaming market had previously been concentrated in their jurisdiction, a reshaping of the market is forcing people to look even further afield.   

What’s behind the recent spate of redundancies? 

While news of layoffs and cut backs can sound the alarm, it is not necessarily a sign of an industry in decline. In many cases, in fact, many experts simply see a natural course correction after the boom of the corona years.  

This phenomenon was highlighted by Bally’s CEO Lee Fenton in an earnings call back in 2023, as many online gaming companies started laying off their staff apace. “The pandemic boosted our business and we continued to hire at full pelt,” he told investors. “I now can see that we may have over-hired in some areas and I take full responsibility for that.” 

In Malta, TalentBet CEO Lam has seen several examples of major companies going on a hiring offensive in growth phases, only to cut back at a later date.  

“Companies scaled up very fast and then, once they settled a little bit, or the market settled, they realised they don’t need all of these people,” she says. “It’s not that they don’t need that role; it’s that they don’t need that many people in that role.” 

Innes believes the industry took a bit of time to adjust to new post-pandemic realities. “During Covid times, it was certainly the case that a lot of companies had a boom in terms of customer volumes,” she says. “It may have taken a bit longer for these customers to stop playing, or the real ramifications to be felt internally with a lot of operators and suppliers.” 

Once they did, however, the layoffs began.  

Consolidation driving iGaming redundancies

Another major driver of redundancies is the industry’s increasing consolidation. As big brands complete mergers and acquisitions, they often look for ways to cut costs and make efficiencies.  

This was the case back in 2022, when 888 bought up William Hill’s non-US assets for £2.2 billion. The acquisition was followed by numerous redundancies – including on the rock. At Malta-based Hero Gaming, meanwhile, dozens of staff were laid off in 2023 in a restructuring process designed to pave the way for new acquisitions.  

Recent layoffs have been reported at Entain’s Gibraltar office, as the operator has restructured a lot of its UK-facing business over the past couple of years, to target renewed growth efforts in the core market.  

Regulatory burdens and new technologies  

Alongside some of the more traditional reasons for cutting staff – like M&A deals and efficiency savings – recent redundancies have also been prompted by new developments in the industry. 

For remote gambling companies, emerging gaming hubs like UAE are exerting a strong pull, with some companies deciding to make cutbacks as they move their operations to new locations.  

In other cases, it is fresh regulations that are threatening jobs in offshore jurisdictions. In key gaming markets like Brazil and the Netherlands, for example, staff are required to be based in the country, putting operators under pressure to relocate their workforce.  

Another major shift in the industry has been the growth of new technologies. Long considered hype, artificial intelligence (AI) has started to make its presence felt in the volatile gambling job market.  

“There have been a few companies recently that have announced redundancies because they’re replacing certain positions with AI,” Innes explains. “That’s something that’s only really been witnessed truly in the last six months or certainly the first part of this year.” 

At the moment, the automation of certain roles is mostly affecting those in junior positions. That includes customer-facing roles like fraud and payments communications with customers. Nevertheless, automation through AI is likely to remain a major topic in the coming months and years as brands look for ways to cut their costs and leverage new technologies. 

Of course, this won’t necessarily remain one-sided: Innes believes that as AI develops, new business opportunities and jobs will emerge with it, such as project managers who can help companies implement new AI-driven processes and solutions. 

“The scale is tipping in the redundancy side at the moment,” she says. “But I do believe that it will level itself out.” 

Life after redundancy 

In Malta’s bustling economy, Lam says redundancy tends to be a short-term situation for most in iGaming, with good candidates getting snapped up quickly.  

“I’ve been working in gaming recruitment for over 10 years and it’s just continuously growing – it never slows down,” she says. “That means there’s always a need for these people with this experience, whether it’s for an established company or a startup, there’s always someone that’s going to need the skill set.” 

Even amid trickier market conditions, TalentBet’s Lam says she rarely sees candidates on the market for more than a month or so. Depending on the role, a suitable job can be found in a matter of weeks. Junior roles such as customer service may take a matter of days to place, while senior roles could take much longer.  

Innes agrees that the situation is far less dramatic for gaming employees than people might believe.  

“If you look purely at LinkedIn and people posting and saying how difficult it is to get roles, you may falsely feel that the industry is not as vibrant or as buoyant as it is,” she says. “But I do think there are roles there. There will always be positions available for anyone with strong industry experience.” 

That said, there are differences between the two jurisdictions: While BettingJobs has seen an uptick in placements in Malta this year compared to in 2024, there were zero placements in Gibraltar in the first quarter.  

Innes attributes this to the wealth of highly regulated, tier-one operators on the island, many of whom are struggling in the wake of Brexit.  

“We talk about Malta and Gibraltar where there have been redundancies made,” she says. “But I think it may be more drastically felt by individuals in Gibraltar.” 

A new world of work  

Being made redundant can be a frightening situation for employees, although many also take it as an opportunity to take stock and consider their next step.  

This might involve taking new courses to refresh or update their skills, or doing some soul-searching about what they truly want from a role and where they want to live. In 2025, Lam says, many iGaming candidates who have been laid off are keen to find remote-working options.  

Many companies have caught up to this burgeoning trend, with the vast majority of TalentBet’s 80-plus clients offering either remote or hybrid working. According to Lam, just two or three have held on to a fully office-based work environment, while the rest largely split the week between home and the office.  

As some firms start to transition back to office-based roles, however, the demand for remote work is becoming one of the major hurdles to placing candidates quickly.  

“We’re not seeing a lot of desperate redundant people coming through the doors,” Lam says. “We’re seeing people that have been made redundant but are being fussier about the next step for them, since they finally have the opportunity for a change.”  

For firms insisting that employees come to the office, it can be much harder to match the ideal candidate.  

“We’re very honest with them and say, ‘We can search for this, but you’re going to miss out on really good people,’” Lam adds. “There may be someone who’s fantastic for the role, but who really wants flexibility.” 

Nevertheless, Innes says the employees on BettingJob’s books tend to be pragmatic and realistic when assessing the market: they realise they may not get the high salaries or perks they had been used to before but are open to looking at offers. 

Embracing change  

For individuals looking for work after a layoff, Innes’ advice is clear: Be creative and flexible and recognise where skills can be transferred to other roles. Employees should also make sure their CV truly packs a punch, she said, and not be afraid of seeking expert advice if they need it. 

Regardless of how long it may take, however, the key is not to lose faith.  

“The industry is so dynamic and entrepreneurial and vibrant and it does offer fantastic career opportunities to individuals,” the BettingJobs CEO explains. “Yes, there have been redundancies, but there is also the emergence of new technologies, of new iGaming hubs. And if you’re willing to embrace that, then the gaming industry is going to embrace you back, right?”  

In a letter sent to Parliament last week, MP Layla Moran, chair of the Health and Social Care Select Committee, said the government should undertake a second review of the Gambling Act.

That letter highlighted the committee’s findings that gambling was connected to high rates of harm and suicide in the UK. It cited data from the Office for Health Improvement and Disparities (OHID) in 2023, which estimated there were between 117 and 496 suicides associated with problem gambling every year.

However, a number of industry analysts have expressed concern over the use of this data, which has been regarded by some as misleading and based on erroneous studies conducted with incorrect methodologies.

Melanie Ellis, partner at Northridge law firm, tells iGB: “It’s frustrating that the letter leads with the debunked estimate of 117 to 496 gambling-related suicides every year in England.

“Ultimately, I think it very unlikely that this letter will prompt a further review of the Gambling Act, while work on implementing the 2023 white paper’s recommendations is ongoing.”

Source of the gambling-related rate of suicide

The origin of the numbers started with the UK’s first state-sponsored calculation of gambling-related suicides in 2021. Public Health England released a report that stated in England there were 409 suicides a year associated with gambling harm.

This study was subsequently replaced by a 2023 update from the OHID that reported the number of gambling-related suicides as between 117 and 496.

Dan Waugh, partner at Regulus Partners, stated in a 2024 report that both the OHID and Public Health England had based their estimates on a 2018 study of the medical records of patients treated in Swedish hospitals between 2006 and 2016. That study was conducted by Dr Anna Karlsson and Professor Anders Håkansson from Lund University.

Public Health England applied the suicide mortality ratios in the Swedish study – that problem gamblers were 15.1 times more likely to take their own life – and used them to come to a figure of 409 problem gambling-related deaths a year in the UK.

OHID then repeated the same methodology in 2023 to reach the figure of suicide associated with gambling disorder between 117 and 409.

“In doing so they ignored critical information and clear warnings that their methods were unsound,” Waugh insists.

“The hospital patients whose records were analysed in the ‘Swedish study’ suffered from a wide range of diagnosed mental and physical health conditions. As a group, they were at elevated risk of self-harm, regardless of the presence or absence of gambling disorder.”

The authors of the Swedish study, Karlsson & Håkansson, themselves acknowledged that the results were likely “skewed toward a population” of people that had more “severe forms” of gambling disorders.

A follow-up study by Karlsson and Håkansson in 2020 found that alcohol and drug misuse were additional factors in reported suicide attempts.

Panel members outspoken

In 2022, then-Health Minister Maggie Throup told Parliament the Public Health England report would be reviewed and the calculation used to create the estimates would be published.

This has yet to be made public, if it was even carried out, and the UK government has had an election and government change in the meantime.

One of the members who had advised on the OHID report as a member of its expert panel was Dr Henrietta Bowden-Jones.

Since the work on that panel, Dr Bowden-Jones publicly stated at a Social Market Foundation event in 2022 that you can’t use methodologies from other markets to accurately assess rates of suicide.

“We cannot extrapolate from Swedish studies, from Norwegian studies – it doesn’t work,” Bowden-Jones said.

Gambling-related rates of suicide

Tracking the rate of suicide due to one factor is a tough task, as suicide can be hard to identify in some cases, or is the result of combined issues that can run the spectrum of mental and physical health disorders.  

Of the hard data available on the connection between gambling and suicides, there is little in modern statistics in the UK made public by the government.

Data from the UK’s Office for National Statistics reported that the number of suicides where “gamble/gambled or gambling” was mentioned on the death certificate was 21 in England and Wales during the period between 2001 and 2016.

However, the Office for National Statistics does urge caution when interpreting this data. As it noted, the data is not “considered completely reliable” as coroners will not always record detailed information about a deceased person’s history. 

“Therefore, these figures represent how many records mentioned gambling on the death certificate but are likely to be an undercount,” the Office for National Statistics stated in 2018, when the data was published.

Waugh, who has been outspoken on this issue, acknowledges that gambling disorder is a risk factor for suicide.

However, it is “one that demands context. Understanding this can be helpful when it comes to devising self-harm prevention strategies,” Waugh adds.

Future approach

If figures are to be produced that show a prevalence of gambling-related suicides, they should have clear methodologies and operationalised definitions. How long has the person gambled? Have they been diagnosed with a gambling addiction? Were there medical comorbidity factors?

The number may not be clear or agreed upon, but people do die from gambling-related harm and disorders. While a move towards clear data should be of the upmost importance, the pain suffered by families impacted by gambling-related suicides should not be forgotten, such as that felt by Liz and Charles Ritchie from the organisation Gambling with Lives.

The Ritchies lost their son Jack in 2017 and recounted their lived experience for the recent Health and Social Care Committee panel, a recount that should not be diminished in any way by potentially erroneous statistics.

Nearly eight months after the death of Pete Rose, MLB Commissioner Rob Manfred removed the hit king from the league’s permanently ineligible list on Tuesday. 

Amid an investigation into gambling allegations against Rose, the former Cincinnati Reds manager voluntarily accepted a spot on the list in August 1989.

The historic announcement by Manfred clears a potential path for Rose’s long-postponed induction into the National Baseball Hall of Fame. In conjunction with Manfred’s sweeping reversal, MLB also lifted the ban on “Shoeless” Joe Jackson and a host of other deceased players. 

Jackson and seven teammates received a lifetime ban from professional baseball for their alleged involvement in the so-called 1919 Black Sox scandal. Despite acquittals on corruption charges, all eight former White Sox players were placed on the list for their role in allegedly fixing the World Series that year.

As with his teammates, Jackson initially agreed to a signed confession. Before his death, though, he denied any knowledge of the match-fixing conspiracy, insisting that he fell victim to an attempt of coercion.

“Obviously, a person no longer with us cannot represent a threat to the integrity of the game,” Manfred wrote in a letter to Jeffrey Lenkov, an attorney who petitioned for Rose’s reinstatement. 

Decision from HOF committee looms

A comprehensive investigation into Rose’s gambling activity found that he placed 52 wagers on Reds games when he served as the team’s manager. More than a decade later, Rose admitted to placing wagers on the Reds, but not on the team to lose.

Following Rose’s death last September, illegal bookie Matt Bowyer claimed that he took action from the MLB legend. Bowyer, the bookie of choice for Shohei Ohtani’s ex-interpreter, told the New York Post that he cut off Rose when the hit king eclipsed his average of $1,000 per wager. 

Jane Forbes Clark, board chairwoman of the Hall of Fame, told ESPN that MLB’s policy shift will enable Rose and the others to be considered by the Hall’s Historical Overview Committee.

Rose is the league’s all-time leader in career hits with 4,256.

Mizzou sets December go-live date

When the Kansas City Chiefs host the Texans this December on Sunday Night Football, there is a strong chance that fans inside Arrowhead Stadium will be able to bet on an anytime Patrick Mahomes rushing touchdown prop.

On Thursday, the Missouri Gaming Commission announced that it has opened the application process for potential sportsbook licensees. Under Missouri legislation, the state’s legal sports betting market must open on 1 December at the latest. The Chiefs, the three-time defending AFC champion, will face the Texans six nights later.

The MGC can issue up to 14 online sports betting licences, along with at least 19 licences on the retail sports betting side. The state will charge $500,000 for a mobile licence, twice the cost of a retail one. Applications for an untethered online sports betting licence are due on 15 July, according to the MGC. All other applications are due in September.

The Chiefs currently have odds of +420 at FanDuel to win the AFC. Kansas City is bidding to become the first team to make it to four straight Super Bowls since the Buffalo Bills in the early 1990s.

NCAA considers ban lift on student-athlete bets on pro sports

The NCAA is considering lifting restrictions that bar student-athletes from wagering on professional sports events, a potential rule change that would create a major shift on a longstanding policy. 

At present, the NCAA prohibits student-athletes from wagering on any NCAA-sponsored sport offered on the professional level. The possible rule change could help the NCAA streamline enforcement efforts, allowing the association to focus on policing match manipulation. This week, an NCAA working group discussed the potential policy shift as the spring championship season reaches the midway point.

Over the last 15 months, college athletics has been rocked by a spate of scandals involving suspicious betting patterns. Federal authorities have reportedly launched an investigation into a major point-shaving breach involving multiple schools.

Policy change may be approved before MLB All Star Game

In April, the Division I Board of Directors directed the Division I Council to adopt changes to sports betting rules – specifically, changes that would allow betting on professional sports. The board of directors voted near-unanimously, 21-1, to approve the change. 

With the backing of the council, the legislation could be approved as early as next month, SI.com reported. Prior to the meeting, sources told iGB that the council was expected to receive an update on the directive this week.

However, the group is not expected to take any formal action until the end of June at the earliest, they noted. More information on the specific changes and a formal proposal will be available at a later date. 

During the 2024-25 college basketball season, several mid-major programs were linked to an illegal gambling enterprise under federal investigation. As of Friday, federal prosecutors in New York continue to investigate the ring for its alleged role in another scandal involving former NBA player Jontay Porter. Federal law enforcement officials apprehended Shane Hennen, an alleged ringleader, in January.

After receiving a lifetime ban for manipulating his performance in at least two NBA games, Porter pleaded guilty last July to federal wire fraud conspiracy. Porter, a younger brother of Denver Nuggets forward Michael Porter Jr, is awaiting sentencing in December. Several other defendants have entered guilty pleas in the conspiracy to defraud a major sportsbook.

Last week, the NCAA disciplined five Iowa State staffers for combining to place more than 6,200 bets, including games involving the university. 

Sportradar encouraged by US trends with in-play betting

Several days after DraftKings drew attention for making inroads with in-game betting over the first quarter, Sportradar reiterated its stance for the US market on live betting.

During the three-month period ended 31 March, Sportradar established a strong position in the US, where the company has data agreements with three of the nation’s four largest sports leagues, according to a quarterly presentation.

For all markets, Sportradar generated consolidated revenue of $347.9 million, up 17% from the year-ago quarter. The company’s US segment represented 28% of its overall revenue mix for the period, compared with 25% from the same quarter in 2024. Sportradar, which reported first-quarter earnings on 12 May, topped analysts’ EPS estimates for the period.

Moving forward, Sportradar projects its US division will grow at a 23% CAGR. Last week, DraftKings CEO Jason Robins noted that live betting in baseball represents about 36% of the operator’s overall volume in the sport. While Sportradar CEO Carsten Koerl indicated that in-game betting represents about 70% of total activity in the UK, the US is trending upward in some respects.

“Some books adapt quicker, some books are adopting slower,” said Koerl on the company’s first-quarter earnings call. “It’s a question of the marketing and where do you direct the people and how do you promote it.”

Extended deal with MLB through 2032

Sportradar, one of the world’s largest sports betting data providers, expanded its data partnership with MLB for eight years through 2032. In the earnings presentation, Sportradar told investors that its “global scale” underpins its ability to “broaden MLB’s exposure to fans worldwide”.

According to statistics from H2 Global Capital, MLB ranks sixth worldwide in gross gaming revenue. From a customer perspective, micro betting opportunities through pitch-by-pitch wagering have increased since DraftKings’ acquisition last year of Simplebet. Besides MLB, Sportradar has also secured long-term data partnerships in recent years with the NBA and the NHL.

In securing the rights to the three sports, Sportradar has assembled a diverse portfolio of exclusive sports content, the company wrote in the presentation. The data provider’s sportsbook partners have accumulated at least 70% of the sports betting gross gaming revenue for each of the sports, according to Sportradar.

The company’s managed trading services unit processed about 32 million tickets last year. MLB, which has taken an undisclosed equity stake in Sportradar, has enlisted the company to serve as the exclusive distributor of its official data, media feed and AV content.

Sportsbook tech providers vie in trade secrets suit

A sports betting technology supplier that has provided its source code to some of the nation’s largest sportsbooks urged a Nevada federal court to deny a motion from a former collaborator that seeks to delay a discovery ruling, pending summary judgment.

The filing is the latest wrinkle in a protracted legal dispute between two sportsbook providers – Amelco USA, LLC and Internet Sports International. ISI, a Las Vegas-headquartered sportsbook software supplier, asked a judge last week to pause proceedings in its lawsuit against Amelco for allegedly stealing trade secrets.

ISI initially filed a lawsuit against Amelco in June 2023, alleging that the latter stole “tens of millions” worth of sportsbook software and code. By last November, ISI filed a motion with the court for partial summary judgment, surrounding the enforceability of two confidentiality agreements.

In a filing on 12 May, Amelco asked a Nevada district court to deny ISI’s motion to stay, arguing that one would create an additional burden on the court.

The two collaborated in 2019 on a retail sports betting solution for Wildwood Casino in Colorado, as Amelco brought on ISI for developing a series of kiosks inside the property. Shortly after completing a licence agreement, ISI claimed that Amelco’s software was “not suited for use” in the US market, according to court documents.

ISI further alleged that the software could not be used in the US without a complete overhaul.

Dispute over discovery

While ISI acknowledged Amelco’s position as a mobile sports betting leader, the company claimed Amelco lacked the requisite understanding of the technical capabilities needed for executing a “kiosk project”. Attorneys for ISI allege that, once Amelco “completed its extraction” of ISI’s confidential trade secrets, the British company discarded the Nevada company.

Amelco subsequently struck deals with some of the nation’s most prominent sportsbooks, including Fanatics Sportsbook and Hard Rock BET. In the 79-page November brief, attorneys for ISI claimed they did not seek a complete resolution of the case or a ruling on whether the company breached a contract by allegedly misappropriating trade secrets.

Instead, ISI asked the court to resolve issues of applicability with a 2019 non-disclosure agreement between the companies.

For its part, Amelco claims that ISI failed to produce key evidence on the software and code until the discovery process had closed. Amelco believes ISI is evading scrutiny over alleged discovery misconduct and has asked the court to proceed.

ISI, meanwhile, asked the court to delay proceedings on discovery pending summary judgment. Alternatively, ISI asked for an extension to 17 July to respond to Amelco’s motion.

“ISI will suffer no hardship from being required to proceed with the lawsuit it filed, and ISI does not need an additional two months to oppose,” Amelco wrote in the brief. 

ICYMI on iGB

‘Existential threat’: Tribal law experts decry rise of prediction markets

ESPN plans enhanced betting tie-ins for much-hyped launch of streaming service

New York mobile sports betting handle rises to $2.15 billion in April

Ohtani’s ex-interpreter now scheduled to surrender in June after continuance

US commercial gaming revenue sets fourth consecutive record in 2024

North Carolina sports betting market shrinks year-on-year in April

Bally’s shuns analysts again, reports another 5% revenue drop in Q1

FanDuel doubles down on RG focus with launch of real-time deposit monitor

Twice last week, the New York Knicks pulled off comebacks of 20 or more points to stun the defending NBA champion Boston Celtics. In this year’s Stanley Cup Playoffs, the Edmonton Oilers made NHL history by rallying in five straight contests to notch victories. Quite often, the runs can prompt bettors to chase losses, leading to depleted accounts. A small subset of bettors may rush back to their apps to deposit and reload.

On Wednesday, FanDuel unveiled a sophisticated responsible gaming tool to help them make informed decisions about the level of funds they deposit with the site. The online sportsbook operator launched Real-Time Check-In, its new responsible gaming technology. At the SBC Summit Americas conference in Fort Lauderdale, Florida, FanDuel outlined a product that combines data with machine learning to analyse and model personalised deposit behaviour in real time. FanDuel’s launch coincides with the seventh anniversary of the Supreme Court’s historic PASPA anniversary.

“We know a deposit is a key moment in the customer journey,” said Cory Fox, who serves as senior vice president of public policy and sustainability at FanDuel. “Now, we’re able to use machine learning to provide a new level of support through Real-Time Check-In encouraging customers to reflect on how much money they’re depositing and if it’s within their budget.”

Self-regulation amid scrutiny of industry’s ‘social licence’

As a congressman from New York looks to mobilise support for a federal framework on sports betting, the debate on government mandates for deposit limits has intensified. A provision in US Rep Paul Tonko’s SAFE Bet Act pertains to issues surrounding affordability. The section prohibits operators from accepting more than five deposits from a customer over a 24-hour period. On the state level, a New York state assemblyman is sponsoring a similar proposal.

Although sportsbook operators stress that compulsive gamblers make up only a small cohort of their user base, internet searches for assistance with gambling addiction have surged.

With some headlines blaring about the perils of compulsive gambling, Fox cautions that the industry’s “social licence” may be at risk. The hazards, he notes, should be enough to push operators to prove that their platforms are sustainable for users.

The product is an extension of another RG initiative that FanDuel rolled out toward the end of the NFL’s last regular season. By February, FanDuel found that approximately 3.5 million customers – or around half its user base – utilised that new My Spend responsible gambling platform.

The dashboard provides customers with a detailed breakdown of betting and deposit activity. Armed with insights into their own decision making, a customer can use My Spend as a tool for making deposits within their means.

Empowering customer decision making

The Real-Time Check-In initiative takes it one step further. The product uses machine learning to predict an expected deposit amount per customer that day. In determining an expected value, FanDuel runs through its casino and sportsbook databases in North America.

The algorithms are trained to evaluate a trove of personalised customer data covering deposits and withdrawals, bonusing and wagering activity, according to Jill Watkins, senior commercial director of responsible gaming at FanDuel.

The models are built to respond to fluctuations in gambling volume based on the daily sports calendar, Watkins notes. On a typical NFL Sunday, a customer’s deposit levels will likely exceed every other day of the week, due to the popularity of the sport.

For the most part, deposits tend to be lower during slow periods of the sports calendar, such as a Tuesday evening in the middle of the summer. FanDuel’s models will account for that, Watkins explains.

An opportunity to reset their own behaviour

If a customer makes a wager that is inconsistent with their normal betting patterns, he or she will receive an alert from FanDuel. From there, a customer can review their spending habits, set a deposit limit or lower the original amount.

In early testing, FanDuel noticed that a sizeable number of customers who took part set deposit limits. The trends leave Fox encouraged at players’ awareness in understanding and controlling their own play. FanDuel has offered a limited version of the product in pilot testing for several months.

A key component of the technology centres on the timing of the alert. FanDuel had the luxury of leaning on Sportsbet, its sister brand under Flutter in Australia, in building the technology. Sportsbet has offered its own version of real-time check.

From a tech standpoint, FanDuel faced some hurdles in building the product. For instance, engineers needed to build the system in a way that it fired right away, as soon as a bettor made a deposit attempt.

Nevertheless, Watkins noted that the rollout went “incredibly smoothly” for FanDuel’s first foray into a buildout fraught with real-time complexities. Ultimately, the company’s RG team is intrigued by the possibility of creating proactive safeguards for customers, with a real-time check in the middle of their deposit flow.

FanDuel will make the deposit tool available to customers in every state where it offers online sports betting. It also plans to expand the product to horse racing and daily fantasy sports later this year.

Besides macroeconomic issues on consumer spending and the global trade war, another topic dominated first-quarter earnings calls this week for top sportsbook operators.

Executives from three leading companies – Flutter Entertainment, DraftKings and Penn Entertainment – were inundated with questions related to a series of unfavourable sports outcomes. The questions surfaced after the operators blamed the negative trends for denting earnings for a second straight quarter.

On previous calls, the executives had bemoaned the patterns over the final quarter of 2024 when NFL favourites covered at a high clip. For the three-month period ending 31 March, the operators now report taking a hit due to an unprecedented trend in March Madness when underdogs largely failed to advance.

In 2025 year-to-date, the adverse outcomes have provided a negative impact of $170 million to revenue and $111 million to adjusted EBITDA, DraftKings reported on Friday’s first-quarter earnings call. Flutter, the parent company of FanDuel, incurred larger damage, noting that the outcomes resulted in a $230 million hit to US revenues. Moving forward, Flutter lowered its fiscal year US revenue guidance from $7.7 billion to $7.4 billion.

Penn Entertainment, the operator of ESPN BET, indicated on Thursday that the outcomes provided a negative impact of $15 million to its revenue, as well as a $10 million impact on EBITDA in the first quarter.

While DraftKings’ risk-management team studied various pricing strategies in response, CEO Jason Robins does not believe the outcomes will be a recurring trend.

“Our analyses provide us strong confidence that the recent volatility we’ve experienced is random in nature,” Robins said.

Florida shelves non-tribal online sports betting bill

Despite extending the current legislative session into June, the Florida legislature withdrew two key gambling bills this week, handing a slight victory to opponents of the Seminole tribe of Florida.

One bill, SB 1404, sought to criminalise mobile sports betting platforms not covered under the state’s gaming compact with the tribe. The bill was viewed as an avenue to potentially augment the tribe’s stranglehold on online sports wagering via Hard Rock Bet. The legislation also contained a broad definition of online gambling, classifying the categories as cash games of chance, including video poker, digital slots and online table games.

Since the bill also aimed to create prohibitions on sweepstake casino products, the withdrawal received high marks from the Social and Promotional Games Association, a sweepstakes industry trade group.

A companion bill, CS/HB 1467, addressed the criminalisation of illicit sports betting platforms across the state. One provision sought to revise criminal penalties involving renting a house for gambling purposes. In February, two former employees of the US Sports Specialty Association filed a motion asking a Florida judge to compel the organisation to hand over documents in a longstanding civil lawsuit. The whistleblowers filed a RICO suit over a series of illegal sports wagering improprieties.

The USSSA, the nation’s largest multi-sports agency, placed CEO Donald DeDonatis III on administrative leave late last year.

Among the accusations, the plaintiffs alleged that several executives “doctored” the USSSA’s books while moving funds from several youth baseball events to certain non-company accounts linked to an unidentified employee.

Both bills can be revived in future legislative sessions.

Alberta bill on sports betting expansion advances

As the Edmonton Oilers move closer to a possible return to the Stanley Cup Finals, Alberta took considerable steps this week to expand legalised sports betting.

The Alberta Legislature’s Committee of the Whole passed the Alberta iGaming Act, also known as Bill 48. While the bill received a third reading Wednesday evening, it still requires Royal Assent for passage.

Sports wagering is currently legal in Alberta, but only on a limited basis. Operated by the Alberta Gaming, Liquor and Cannabis Commission, Play Alberta is the only legal online gaming and sports betting platform in the province. The launch of a commercial sports betting market in Alberta could result in annual gross gaming revenue of $700 million, according to JMP Securities.

The framework closely mirrors the market for online gaming in Ontario. As of this week, the Ontario market had more than three dozen operators. Ontario is the nation’s most-populous province with more than 14.2 million residents, while Alberta ranks fourth with 4.3 million.

An official date for the launch of the market has not been set. Addressing the timing of the Alberta launch on Thursday’s first quarter earnings call, Penn Entertainment CEO Jay Snowden expressed confidence that the market will go live over the next several quarters.

The Oilers entered Friday’s slate as the favourite at FanDuel to hoist the Stanley Cup. Edmonton defeated Vegas on Thursday night to take a 2-0 series lead in the Best-of-7 Western Conference semifinals. With the overtime victory, the Oilers’ championship odds moved to +300 at FanDuel.

Son of ex-NYC mayor Giuliani to head World Cup task force

As the one-year countdown to the 2026 Fifa World Cup nears, the son of former New York City Mayor Rudolph Giuliani received a high-profile position this week.

On Tuesday, US President Donald Trump appointed Andrew Giuliani as head of the World Cup task force. During Trump’s first term, Giuliani served as associate director to the Office of Public Liaison and as an assistant to the president. Since then, he failed in an election bid to become governor of New York.

Ahead of last December’s congressional hearing on sports betting, two US senators urged the Justice Department to examine the nexus between illegal sports wagering and transnational organised crime. Senators Marsha Blackburn of Tennessee and Catherine Cortez-Masto of Nevada are seeking additional information on the potential crime connection, prior to two major international events. Following the World Cup, Los Angeles will host the Summer Olympics in 2028.

The US will host the World Cup along with Mexico and Canada. Of the 11 sites on US soil, five are in states that will likely offer mobile sports betting by the start of the event. The availability of in-game betting inside the venues may bolster handle considerably in those states.

At the same time, there are expectations that the gambling industry will monitor illegal data scouting closely throughout the tournament, an industry source told iGB. While France and Spain are presently the World Cup co-favourites at FanDuel  (+550,) the US remains a longshot at +3400.

Defy The Odds unveils partnership with EDGE Markets

A startup run by several prominent female gambling executives is partnering with the company behind EDGE Boost, one of the first debit card products designed specifically for responsible gaming.

On Tuesday, Defy The Odds announced a strategic partnership with EDGE Markets, a company that provides bettors with a financial skillset to augment their gambling appetite. EDGE Markets emerged out of stealth mode last month after completing a $17.2 million funding round. Since the start of 2024, EDGE Boost processed over $300 million in transactions.

“EDGE Boost is focused on providing bettors with financial tools that enhance their experience while keeping responsible gaming at the forefront,” said Seni Thomas, founder and CEO of EDGE Markets.

By offering a comprehensive suite of services – including community building, mentorship and networking opportunities – Defy The Odds aims to bridge the gap between groundbreaking ideas and tangible opportunities in the gambling industry. Former Pinnacle Sports CEO Paris Smith launched Defy The Odds last year alongside industry veterans Sue Schneider and Kelly Kehn.

“For operators, it identifies responsible players without adding extra costs or complexity,” Smith said in a press release. “We’re excited to partner with Seni and the EDGE Markets team and help drive EDGE Boost to the next level.”

The EDGE Boost bank account is FDIC-insured up to $250,000, providing financial security for users, while their personal banking data is safeguarded on a private, encrypted platform.

ICYMI on iGB

DraftKings treads water in Q1 but pricing questions persist as favourites’ bug bites books

Flutter buoyed by strong US results in Q1 as CEO Jackson expounds on prediction markets

MGM pens new employment agreement with CEO Bill Hornbuckle

CFTC stands down, seeks dismissal in Kalshi election betting appeal

HG Vora launches legal challenge against Penn Entertainment over board changes

Penn still bullish on ESPN BET while remaining mum on proxy battle

Genius Sports confident on long-term growth after cutting net loss in Q1

Wynn sees revenue fall nearly 9%, delays projects as CEO Billings downplays tariff impacts

Historic trends during March Madness hijacked earnings on the quarter, as top seeds covered at an unprecedented rate throughout the month-long college basketball tournament. Across the event, higher seeds won at an 82% rate, according to DraftKings, which described it as the highest rate in the history of the NCAA Division I men’s basketball tournament. For 2025 year-to-date, the headwinds from the negative sporting outcome have provided a negative impact of $170 million to revenue and $111 million to adjusted EBITDA.

DraftKings’ crack staff of quantitative modelling experts studied the trends assiduously over the quarter, pouring over a slew of historical data across multiple bet types. As with its main competitors, DraftKings dealt with the headwinds at the tail end of the NFL regular season when favourites covered at a high clip. Top sportsbooks also took a hit in last year’s NCAA tournament when higher seeds prevailed at a rate of 69%.

“Our analyses provide us strong confidence that the recent volatility we’ve experienced is random in nature,” said DraftKings CEO Jason Robins on Friday’s first quarter earnings call.

The convergence between structural and actual hold

The NCAA did not hold March Madness in 2020 due to the Covid-19 pandemic. In the five years since, the win percentage by a higher-seeded team has eclipsed 66% in each year.

Prior to the pandemic, higher seeds advanced at a rate of 68% and 69% in 2018 and 2019, respectively, according to DraftKings’ figures.

Within the first 10 seconds of Friday’s call, Robins addressed trends of negative sports outcomes. Predictably, he fielded a query on the topic during the first question of a session with analysts.

One theory Robins discussed surrounds the impact of Name, Image and Likeness (NIL) deals on the college landscape.

Two years ago, favourable sport outcomes in the first quarter contributed approximately $20 million to the company’s revenue improvement, DraftKings noted at the time. That year, a pair of mid-majors, San Diego State and Florida Atlantic, advanced to the Final Four.

But as NIL deals become more lucrative, star players such as Cooper Flagg and Walter Clayton Jr have flocked to powerhouse programmes in the nation’s largest conferences. Flagg, the Naismith Player of the Year, inked an endorsement deal with New Balance despite Duke’s longtime partnership with Nike.

If the theory holds true, March Madness could experience fundamental changes in rates of favouritism. But Robins believes that it would not change the fact that customers may still gravitate to favourites, a historical trend across the industry.

DraftKings exceeded company expectations with a structural hold of 10.4%, coupled with an actual hold of 9.5%. If the NIL trends prevail, DraftKings can respond by optimising its lines slightly, according to Robins.

“If that occurs, the model will pick it up” and the two will “converge”, Robins explained.

One potential solution centers around the utilisation of AI for DraftKings’ pricing and risk-mitigation strategies. In a letter to shareholders, Robins emphasised that DraftKings is embracing an “AI-first” mindset to unlock greater speed, efficiency and scale across the business. As it relates to risk management, Robins is intrigued by the opportunity AI presents moving forward.

Robins has been pleased with metrics related to in-game betting in the wake of acquisition of micro-betting platform Simplebet, as well as SportsIQ and Mustard Golf. For the first time, he has noticed a material impact from the offerings on customer activity. In baseball, live betting represents about 36% of DraftKings’ overall volume, Robins noted. For microbets, DraftKings does not want its hold to be too high, but can increase levels for other markets such as second-half outcomes, he added.

Mixed bag of results for DraftKings

For the three-month period ended 31 March, DraftKings generated revenue of $1.41 billion, slightly missing analysts’ consensus estimate of $1.45 billion. The company reported adjusted EBITDA of $102.6 million, topping forecasts of $98.9 million. DraftKings also reported earnings per share of $0.12, in line with forecasts from analysts.

In light of the headwinds, DraftKings revised its fiscal year 2025 revenue guidance midpoint to $6.3 billion. The company now expects revenue of $6.2 billion to $6.4 billion, compared to its prior range of $6.3 billion to $6.6 billion, said CFO Alan Ellingson.

DraftKings also anticipates adjusted EBITDA of $800 million to $900 million, compared to previous guidance in the range of $900 million to $1 billion. The company projects structural hold to fall under 11% for the third quarter, but to come in a smidge higher in the final quarter of 2025.

DraftKings is not the only major operator that experienced the ill effects of the trends from March Madness. Virtually every top sportsbook has discussed the headwinds during earnings season.

Still, the patterns could raise questions about DraftKings’ pricing mechanisms and algorithmic capabilities after the recurring issue. While one-off exogenous events can be brushed aside, the issue can become disconcerting if it persists several years from now, a prominent Wall Street analyst told iGB of the pricing trends for favourites.

Other highlights from DraftKings’ Q1 earnings report

• DraftKings’ metric known as “monthly unique payers” increased to 4.3 million average monthly unique paying customers, representing an increase of 28% from the same period in 2024. The increase reflects strong unique payer retention and acquisition across DraftKings’ sportsbook and iGaming offerings, the company disclosed.

• Another metric with the abbreviation “ARPMUPS” came in at $108, representing a decrease of 5% compared to the first quarter of 2024. The abbreviation stands for “average revenue per monthly unique player”. Excluding the impact of the company’s acquisition of Jackpocket, ARPMUPs increased approximately 7% compared to the first quarter of 2024, DraftKings noted.

• Speaking briefly about recent trends involving prediction markets, Robins indicated that DraftKings is monitoring the trends among the companies, including recent court cases. Robins plans to keep an eye on commentary from state regulatory bodies and tribal gaming entities as the topic intensifies. He is particularly interested in the trends in markets that do not offer legalised sports betting at the moment.

• Robins indicated that he believes DraftKings is well positioned for the evolving macroeconomic environment. In mature markets, online gaming experienced resiliency during the global financial crisis, he added. A threat of a prolonged global trade war and an entrenched recession has served as a popular topic on quarterly earnings calls.

• In February, Jackpocket stopped operating in Texas after the state’s lottery commission banned courier lottery services. Jackpocket subsequently departed from the New Mexico market in the following month. While Robins is cautiously optimistic that Jackpocket will turn a profit this year, he indicated that it could break even largely due to the Texas departure. The company is working toward integrating Jackpocket into the DraftKings app before the end of the year.

In evaluating its core value drivers, DraftKings emphasised that the metrics outperformed the company’s expectations. DraftKings pointed to product enhancements that are driving higher structural sportsbook hold percentage and the company’s efficiency with deployment of promotions. Speaking of promos, DraftKings noted that promotional reinvestment became more efficient year-over-year as a percentage of gross gaming revenue.

For the quarter, DraftKings’ handle increased 16% year-over-year to $13.9 billion. For vintage states that offered sports betting before 2024, handle jumped 11% from the prior year’s quarter, DraftKings said.

Stock moves

In the weeks leading to Friday’s earnings call, DraftKings experienced a slew of downgrades from Wall Street analysts. One prominent institutional investor, BlackRock Inc, also trimmed its holdings on the period. As of 31 March, BlackRock held 23,120,591 shares in DraftKings, a reduction of 8,072,754 from its previous position. The reduction represents a 25.9% decrease in the firm’s holdings in DraftKings.

As of Friday, about 80.2% of DraftKings’ shares were held by institutional groups, according to Yahoo Finance.

After releasing quarterly financial results on Thursday after the bell, DraftKings traded at $35.35 a share in the after-hours session, up nearly 2%. DraftKings ticked up to $36 in Friday’s pre-market session.

On Friday morning, DraftKings reached a high of $37.60 a share, before falling to $36.50 at 11.30am ET.

But times are changing and the deals that have been in place for years have come under fire in recent months.  

Critics have long warned that there is too much gambling advertising within the sport, which presents a risk to children watching and engaging with football. In an effort to quieten these claims, Premier League teams agreed on a voluntary ban on front-of-shirt sponsorships in April 2023.  

This will inevitably force teams and operators to pivot away from the traditional sponsorship model and adopt new and innovative brand exposure opportunities during matches. The move comes into force from the end of the 2025-26 Premier League season, in May next year.  

What will the new era of football gambling sponsorships look like?  

Alan Alger, industry sponsorship and PR specialist, expects teams will (and likely already have) inflated the price of their shirt sponsorships ahead of the ban, as gambling companies scramble to maintain that visibility for a final season.  

“The savvy clubs that know this are obviously putting their prices up for next season, knowing that this is their last opportunity. And you would also expect the clubs in the Championship, which are eyeing a return to the Premier League, will all be looking at the chance to have one big payday back in the league,” he tells iGB. 

Alger played a pivotal role in securing and managing Betway’s 2015 principal sponsorship agreement with West Ham United. Reflecting on the 10-year-old partnership, he says it was a “very good deal for Betway”, whose brand appeared on the team’s shirts from the middle of the season, after the team’s former partner went bust.  

“If you’re going to introduce yourself to a new market, one of the best ways is via the most-watched sport,” he says. 

LEDs and sleeve sponsorships still available to gambling operators

But this legacy model is primed for change. Those close to the deals expect the sector will adapt and gambling branding will be just as present in the sport, both via LED advertising boards around the pitch and through novel activations with players and their teams. 

“You might see companies that have a largely global reach start to use player appearances for adverts in countries that don’t have as tight a legislation as we do in the UK,” Alger suggests.  

Currently, the UK prohibits players under the age of 25 from appearing in gambling marketing as this could appeal to an underage audience.  

“I think there will still be immense value in a betting partnership with a football club,” says one legal source active in the gambling sponsorships space.  

“The sleeve is still available, the LEDs are still available and, outside of the UK, using players to promote your brand is still available. It really depends on the structure of the deal, but if it’s a global deal then I think there’s as much value in that. 

“The interesting thing will be how the price of these deals is affected by exclusivity, because with a front-of-shirt deal, you’re paying big money for that, it’s very visible and there’s a lot of exclusivity that you normally get with that.” 

Could gambling sponsorships become more regional?

Some also expect operators and teams may slightly move the goalposts on the kinds of partnerships they form. Outside of front-of-shirt deals, many operators sign on as global betting partners for leading football teams. But in the future, this could become much more region specific, with teams adopting Asian or African betting partners, for example.  

The legal source believes this could open up new exclusivity opportunities for operators. “They might think about doing regional deals, as opposed to a global partner, that provides exclusivity to do multiple LED minutes from different regions,” they add. 

“But it’s very complicated around where you can and can’t serve the advertising. And obviously they’ve got broadcast feeds going out all around the world, so it’s quite an operation for them.” 

Partnering with leagues and rights holders to maximise brand exposure 

Operators have also begun to partner with tournament holders to maximise brand activations and expand their global reach.  

Bet365 announced a landmark betting partnership with the UEFA Champions League in August last year, covering the men’s Champions League, from the 2024-25 season until the 2026-27 campaign. 

As part of the deal, Bet365 maintains exclusivity over stadium branding during Champions League matches. “That was a good move by Bet365, but they’ve got the money to do it,” says Alger.  

“If you can partner up with tournaments and rights holders, as in leagues and cup tournaments, you’ve got a much better chance of having [your brand] spread across lots of different teams,” he tells iGB.  

But the legal source notes global deals, like those with leagues, are riskier from a due diligence perspective. Leagues may have a lower appetite for risk than teams as they are bound by regulation and public perception. 

“[They will] need to do a really thorough analysis of exactly what their rights are and whether there is any potential for either party to commit an offence [under the terms of the deal],” the lawyer adds.

Are white label sponsorships under threat?  

Both the UK government’s Department of Culture, Media and Sport and the Gambling Commission have said white label football sponsorships are under investigation. The model enables non-UK licensed operators to forge sponsorship deals with teams, as long as a white label version of their product, operated by a locally licensed company, is active in the market and meets all gambling regulations.  

“I think everyone thought that was quite a sensible rule, because you have got a brand in the UK that is licensed and you do have a touch point for the club, the fans and everyone else to see,” Alger says of the white label model.  

However, in December, gambling minister Baroness Twycross told an audience at the GambleAware annual conference the government was investigating the white label sponsorship model. This followed news that Curacao-licensed BC Game was largely operating illegally and had been declared bankrupt by a local court for failing to pay out player winnings.  

Nothing has been announced by the DCMS since this mention of the investigation last year.  

BC Game was swiftly stripped of its UK white label licence and its sponsorship deal with Leicester City was thrown into question.  

At the time the football club said the operator was appealing the case, and it had no issues with liquidity.  

Stake remains on Everton’s shirts for now

Then, in February, Stake was stripped of its UK white label licence, amid a Gambling Commission investigation into social media advertising from the operator. Despite no longer operating in the UK market, Stake remains Premier League team Everton’s shirt sponsor, at the time of writing.  

The Everton/Stake deal signed in June 2022 raised eyebrows considering Stake’s cryptocurrency gambling activities globally, although gambling with crypto is not prohibited in the UK. 

The Gambling Commission said it would contact Everton, as well as two other clubs with unlicensed betting sponsors, to warn them of the risks of promoting illegal sites. 

Despite these warnings, the legal source does not foresee a significant change in the white label model in the short term.  

“The change can come from legislation. And currently, the legislation is quite clear that you must have a licence, if you’re doing certain things as a gambling operator in Great Britain. A change in the law is not going to happen easily,” they suggest.  

The other option for changing the model is if either the football or gambling industry champions a change in the system.  

“[But] the only real incentive for [the teams], as they’re turning down money that these people are prepared to pay, is to raise the standard of the sport and make sure there isn’t money coming in from [bad actors].” 

House of Lords approves Football Governance Bill  

Historically, there has not been much regulation around the sport itself in the UK, but last year a bill was established in Parliament to build a regulatory framework that can govern football.  

The Football Governance Bill was initially introduced via the House of Lords in October, with the aim of establishing an independent football regulator to oversee the sport and handle issues such as club licensing.  

Law firm Pinsent Masons said the independent football regulator would oversee the licensing of football clubs in the top five flights in men’s football.  

In a blog post, dated 27 March, the firm said the entity would “ensure the fair distribution of revenue from football broadcasting deals and protect the interests of fans and communities”. 

In the final stages of House of Lords discussions, an amendment to enforce a ban on gambling sponsorships and advertising within the sport was suggested. But this was swiftly vetoed, by a clear majority of 339 to 74. 

The clause was put forward by Liberal Democrat politician Lord Addington in March’s round of amendments. 

“Duty to prevent advertising and sponsorship related to gambling in English football. English football must not promote or engage in advertising or sponsorship related to gambling,” the proposed clause said. 

Lower tier teams would suffer most from gambling sponsorship ban 

But members argued lower tier and non-league teams would suffer financially from the loss of gambling deals.  

Member Baroness Fox of Buckley asked: “Why would we cut off a perfectly legitimate source of funding in the form of lucrative sponsorship, which is what these amendments would do?”  

She also said a ban on gambling sponsorship would create a politically charged regulator, which was not the bill’s intention.

Both Alger and the lawyer are skeptical about whether a full ban will ever come into force.

“We’ve seen bans on branding from other sectors like alcohol and tobacco in sports,” the lawyer says. “But again, it’s usually the sports themselves that say, ‘This no longer feels like the right thing to do.’ There are different views on the health issues associated with gambling.”  

The bill has, at the time of writing, reached the committee stage at the House of Commons.  

For now, it looks like gambling sponsorships are safe from total prohibition. While the model is evolving, and new versions of legacy deals are coming to the forefront, the sector’s bond with English football is too deep-rooted to be totally scrapped.  

HM Revenue & Customs and the treasury proposed Monday to consolidate the current three-rate system for remote gambling to a single remote gambling tax, called the Remote Betting & Gaming Duty (RBGD).

As part of the reform, the departments called for input from industry stakeholders. The consultation process will run for 12 weeks and close on 21 July.

The government is expected to set out its final plans during the autumn budget. In its consultation, it said the tax shake-up would simplify the tax system and reduce administrative costs for operators.

Current system has three UK gambling tax rates in place

Currently, the UK has three tax rates in place: Remote Gaming Duty (RGD), which is set at 21% of operator gross profits; General Betting Duty (GBD), which is set at 15%; and Pool Betting Duty (PBD), at 15% of net stake receipts.

But, industry folk are concerned the tax rate for betting will be increased to be in line with the current remote gambling duty.

Responding to the consultation launch, Betting and Gaming Council (BGC) CEO Grainne Hurst said if the reform led to higher taxes overall, it would be a “self-defeating” move by the government – one which “makes a mockery” of its growth strategy.

“Any potential further increase in taxes on our members, so soon after a white Paper which cost the sector over a billion pounds in lost revenue, will not raise more money for the treasury,” BGC’s Hurst said in a statement to iGB.

Hurst also said raising GBD to the same level as RGD could be “catastrophic” for the racing industry’s finances.

A spokesperson for the British Horseracing Authority told iGB they welcomed the opportunity to be involved in the consultation process. However, there is concern that the tax harmonisation would have “unintended consequences” for the sector’s finances.

Could UK betting sector be hit with higher gambling tax rate?

Additionally, some have expressed concerns the government may be about to favour on-premises gambling sites. The proposal documentation does highlight retail and on-premises casinos having higher costs than online operators. These include building maintenance, larger staff and utility costs.

Gambling consultant Steve Donoughue told iGB the black market will ultimately determine future tax rates. He believes more and more gamblers will leave the increasingly restricted legal market for competitive deals offshore.

Last month, gambling charity Deal Me Out reported UK gamblers were being driven to the black market by increasing friction on licensed products.

Additionally, Donoughue expressed concerns the UK gambling tax reform could lead to a cash grab by the treasury.

“Anyone who believes this will be seen as an opportunity by the cash-strapped treasury to revert all taxes back to the original idea of having practically all gambling taxes at 15%, is living in cloud cuckoo land,” Donoughue said.

“A decade ago the treasury said they believed you could tax online gambling as high as 29% without creating a black market, so the new rate could be up as high as that.”

Treasury has overstated gambling growth in UK, says Regulus

In a consultation document, the treasury estimated gambling in the UK had a gross gambling yield of £15.6 billion annually (as of 2014). Approximately £3.4 billion of that is taken by the exchequer in excise duties each year.

But Dan Waugh, partner at Regulus Partners, told iGB the government had potentially miscalculated the GGY growth of remote gambling in recent years. According to its estimate, the sector has had “exponential” growth of 208% between 2014 and 2024.

“The problem with this calculation is that it ignores the fact that remote gambling licensing, and therefore taxation, was based on Point of Supply until November 2014,” Waugh said.

“As a result, seven months of the 2014-15 year were under PoS and not Point of Consumption, which means that a large number of operators were not reporting GGY to the Gambling Commission. The 208% growth statistic is therefore based on a false comparison.”

He noted that if you look at the commission’s statistics for 2015 to 2024, online sports betting growth was a more realistic 36%.

Entain CEO: UK gambling tax rate change is a few years off

During Entain’s Q1 earnings call Tuesday, CEO Stella David took a more pragmatic approach to the news. She told analysts the reform was still incredibly nascent and, considering the legal process needed to adopt a new system, the sector would likely not see any changes come into force until 2028.

“It’ll be a long journey. There’s a consultation and legislation would have to change, so the earliest we perceive there would be some change is late 2027, early 2028. There’s a lot that can happen between now and then. It’s really early days and nothing will happen in the short term,” David said.

AI is already being used to create promotional content for illegal operators. Over the Easter weekend, Sky News reported it had recently discovered an AI-generated video of Sky News presenters touting gambling apps.

Older footage of news presenter Matt Barbet was used to make a video that purported to have him talking to another Sky News correspondent about an iPhone game they had won £500,000 on. The fake adverts were spread through social media and supported the marketing of illegal gambling sites contained within gaming applications on the Apple app store.

AML risk of AI

In April, the UK’s Gambling Commission issued an update warning of the prevalence of AI deepfakes connected to emerging money laundering and terrorist financing risks.

Last year, the UK’s Joint Money Laundering Intelligence Taskforce published an amber alert on the use of AI to bypass customer due diligence checks. The UK’s National Crime Agency (NCA) took down a website last year that was offering AI-generated identity documents, such as passports or driver licences, for just $15.

The Gambling Commission has advised all operators of the need to train staff in the assessment of customer documentation for AI-generated documents.

Threat actors and fraudsters are well versed in emerging technologies. With the prevalence of digital mediums for public and private services, synthetic identity theft has become an increasing challenge for law enforcement.

“Synthetic identity theft is a type of fraud in which genuine and fabricated personal information are blended to generate a completely new, fake identity,” Dr Michaela MacDonald, senior lecturer in law and technology at Queen Mary University of London, tells iGB.

“Alongside voice cloning, behavioural mimicry and deepfake technologies, AI-generated synthetic identities can easily bypass traditional Know Your Customer (KYC) systems by defeating facial recognition, exploiting support chats, or spoofing voice-activated authentication.”

Research on deepfake technology from the Alan Turing Institute, published in March, said AI-enabled crime is being driven by the technology’s ability to automate, augment and vastly scale up criminal activity volumes.

That report stated: “UK law enforcement is not adequately equipped to prevent, disrupt or investigate AI-enabled crime.”

While legislation may help to deter the threat of AI-enabled crime, the institute called for a “more robust and direct approach” – one that is centred around the “proactive deployment” of AI systems in law enforcement.

How will regulators likely respond to deepfake incidents?

Regulators across the world tend to be strict on AML infringements, which have historic connections to the gambling industry given the movement of vast sums of money.

In the UK, the Gambling Commission hit two operators with penalties for AML and customer care failures last month. The Football Pools was ordered to pay £375,000 (€449,732/$484,417) for AML breaches. The regulator found that when AML thresholds were reached, Football Pools’ processes did not initiate hard stops. These only kicked in when a “manual” review was taken.

Corbett Bookmakers was hit with a fine of £686,070 for numerous AML failures, which included not knowing the appropriate customer, product, geographic and payment risks. The commission stated that it had failed to take a sufficiently risk-based approach to AML.

When it comes to the developing risks of AI on the gambling sector, the Gambling Commission has stated that all operators must train staff in the assessment of AI-generated documents.

Regulators can approach the issue by allowing information sharing across secure channels, promoting innovation in the sector and international cooperation, as well as reviews of their own frameworks.

Fast-moving technology

Annabelle Richard, legal partner at Pinsent Masons, tells iGB that given the emerging and fast-moving nature of this technology, regulators may be lenient in some early cases of AML rules being perpetrated by deepfake technology.

If operators find their systems have been bypassed in some way, but they are still unsure of what the remedy should have been at the time of the incident, the regulator may opt not to hit them with an AML warning or fine.

However, if a failure of systems occurs, or an operator has been too slow to spot something that the tools exist to catch, a regulator will likely not be as lenient.

“If you haven’t even engaged with the authority to say ‘I’m not sure what I can and can’t do,’ it will be considered that you didn’t do what you were supposed to, to abide by your regulatory obligations. And that’s going to be a whole different situation,” Richard states.

How gambling can mitigate the AML AI deepfake risk

The UK’s National Crime Agency says fraud is the most prevalent crime in the UK and AI has the potential to increase the speed, scale and sophistication of online scams.

With AI technology, threat actors can target more victims or companies across international and language barriers. The use of deepfake images and videos is increasing the difficulty of fraud detection.

“The use of AI to facilitate fraud underscores the need for private industries, law enforcement and the public to all take steps to reduce the threat. The UK’s Online Safety Act puts more onus on the online platforms to take action and we are continuing to work with government and regulators to maximise its impact,” the NCA tells iGB in a statement.

The UK’s 2023 Online Safety Act set out rules to curb online fraud. Service providers have been asked to introduce measures that tackle fraud and terrorism.

These include the explanation of how they undertake account verification, as well as the inclusion of automatic detection software that finds and removes advertisements or posts that are linked to the sale of stolen credentials or faked credentials.

Operators need to refresh AML processes

With the growing sophistication of the AI threat, operators need to keep up to date with best practices and technological innovations. Operators can enhance AI-based document checks with biometrics such as facial verification and liveness detection checks. The use of device fingerprinting and geolocation services would also increase detection rates.

Additionally, machine learning applied correctly could identify inconsistencies in player activity that may give an additional layer of security.

Queen Mary University lecturer MacDonald tells iGB there are several technologies emerging which will help detect synthetic identities and manipulated materials. These include end-to-end orchestration, data intelligence and artificial intelligence.

“These tools work together to centralise verification processes, analyse large datasets for subtle inconsistencies and leverage machine learning to detect evolving fraud patterns with greater accuracy and speed,” says MacDonald.

“However, implementation varies widely. High-quality defences require significant investment and many operators are using the same class of AI tools for verification that fraudsters are using to attack them.”

Fraud and gambling are old enemies

The gambling sector has always been a ripe target for manipulated documents and fraudulent activity. There has been a constant arms race between operators and fraudsters trying to get one past security systems.

Gambling industry expert and Circle Squared consultant Mick d’Ancona tells iGB that operators have dealt with dodgy documentation from players for years.

“All that’s happening now is it’s easier to [fake documents required by operators]. But actually, if you’re a good operator and you’re [processing documents] properly, you’ve got what you need in place” already, d’Ancona says.

However, he believes it won’t be cheap to mitigate the risk of fake documentation, as fraud gets more sophisticated and operators must keep their processes up to date.  

Smaller operators, or those in the grey markets, may not be properly putting protections in place, he warns. Budget constraints or lack of protection engagement raises the risk of due diligence failures.

“If you only ask for a copy of a passport, but you don’t do a likeness check, or if you just ask for proof of funds when you don’t actually have the staff, experience and the tooling to check that it’s a legitimate bank and that everything looks right with it, you are, for sure, exposed,” d’Ancona states.

Emergence of electrical ID wallets

One method that could help curb ID fraud is the introduction of official or national digital identifications.

Digital identity wallets or applications use numerous technologies to secure and confirm identification. These include cryptographic keys and biometric data, as well as fingerprints and facial recognition.

Digital wallets are not a nascent technology. Singapore brought out its SingPass in 2002, which acts as a national ID, allowing users to file taxes or access medical documents.

Estonia also introduced its digital ID card in 2002. Other nations with digital ID options include Germany, Sweden, Japan and Canada.

The UK’s Post Office EasyID launched in 2021. It provides a digitalised ID that is government certified and can be used for right to work, criminal record checks and age verification.

The EU has already taken some steps in ID regulation that could be a useful aid in securing operations as the EU Digital Identity Framework Regulation came into force in 2024.

Under the regulation, EU member states must offer at least one digital identity wallet to citizens.

This app ID will allow people to identify themselves to public and private online services.

Jarek Sygitowicz, co-founder of identity verification software developer Authologic, thinks the implementation of the electronic ID wallets could be a game changer.

“These have seen adoption growing over the years, but with the EU implementing the eIDAS 2.0 regulation, what has been a slow wave will become a big jump in the next 12-24 months. While the EU has led the adoption of e-IDs, even skeptical countries such as the UK are planning to launch their own digitised driving licence in the summer,” Sygitowicz tells iGB.

Call for standardisation and consistency

The threat of AI deepfakes is already here, but again, so are the majority of the tools that will be used to mitigate the risk.

While AI software in the wrong hands is capable of producing fake IDs and mimicking biometric data with increasing precision, there are advanced measures available. However, the adoption is patchy and smaller platforms may not be aware of their options.

“What’s missing right now is consistency. There’s no shared framework for tackling AI-driven fraud, and that needs to change,” Web3 recruiter Spectrum Search CTO Peter Wood explains.

“Regulators should be pushing for industry-wide standards around ID verification that are designed to hold up against AI. We also need to see better collaboration between platforms, some kind of anonymised, real-time data sharing system that helps flag suspicious activity across the board.”

One of the key challenges in detecting synthetic identity fraud is that personal identifiable information can be fragmented across multiple platforms. If there is no “unified oversight”, it can be difficult to spot inconsistencies.

MacDonald says one way to mitigate this would be for regulators and law enforcement to encourage “international coordination on synthetic ID detection, information sharing and regulatory standards, which will be essential to staying ahead of increasingly sophisticated AI-driven fraud”.

While the risk profile for potential fraud and AML breaches enabled by the use of AI has risen, operators’ obligations to be informed and up to date have not changed.

There are tools that can help keep the gambling sector ahead of the threat, but the industry and regulatory stakeholders may need to come to some form of consensus about best practice.

In recent months, Caesars has expressed a willingness to consider a spin-off of its digital business, one armed with loads of growth potential surrounding the expansion of the company’s online casino ventures. In March, famed investor Carl Icahn garnered headlines when he reached an agreement with Caesars to expand the size of its board. Within the agreement, Caesars consented to the appointment of two directors who serve as executives with Icahn Enterprises LP, the investor’s multi-billion dollar conglomerate.

“He wants to be involved in the conversation and I welcome him to join us,” Reeg told iGB on the sidelines of the East Coast Gaming Congress. “We have a great relationship.”

Long-term profitability on the digital side?

While Caesars posted overall net revenue of $11.2 billion (£8.4 billion/€9.8 billion) in 2024, approximately $1.2 billion came from its digital arm. The online segment gained approximately 20% from the previous year.

Caesars also reported adjusted EBITDA of $117 million on the digital side, more than tripling the amount of $38 million in 2023. The favourable results prompted Caesars Digital to reiterate long-term EBITDA targets of $500 million annually.

Caesars management also hinted at a potential spin-off last December at a Truist investor summit. At the time, there were strong indications that Caesars’ online gaming brand grew at a faster rate than the broader market, while its standalone Caesars Palace online app demonstrated signs of improved slot mix.

While analysts believe a divestiture may “crystalise” its value, the entity would need to be profitable to have investment on a pure-play basis, Truist analyst Barry Jonas wrote in a research note.

At Caesars’ last earnings call in February, Reeg emphasised that “operationally, it made the most sense to keep everything together as one”. Still, he believes the timing is right to consider the digital business as a pure play.

Caesars’ multi-billion case study

Before Caesars evaluates its next steps, Reeg indicated that the company has to prove it is “scalable” with the underlying digital business.

If the online arm makes the proper strides, then Caesars has to determine if it is reflected in the share price. If not, Reeg noted there are tools at the company’s disposal to realise the value.

A key figure to watch this year centres around analysts’ consensus estimates for Caesars Digital revenues at $352 million. If Caesars can top the projections, while trading at an EBITDA multiple of 12.5x, the digital unit will trade at a deep discount relative to DraftKings, according to a January note from Deutsche Bank analyst Carlo Santarelli.

At the time, it translated to a standalone valuation of approximately $4.4 billion for Caesars’ online business. Most pure-play, digital-only gaming operators trade in a range of 15x-25x.

A rapport with Icahn

Icahn is no stranger to Caesars. The financier began accumulating shares in Caesars seven years ago, building a stake that eventually reached 25%. Icahn won three seats on the Caesars board, then pushed vigorously for the sale of the company. After Eldorado Resorts completed a $17.3 billion acquisition of Caesars in 2020, Icahn exited from his position.

The investor re-emerged last August when he disclosed in a Form 13F filing that he owned more than 2.4 million shares in the “new Caesars”. As of 31 December 2024, Icahn’s position remained unchanged. Then, last month, Caesars added two independent directors to its board – both with ties to Icahn. The appointments of Jesse Lynn, general counsel of Icahn Enterprises, and Ted Papapostolou, the CFO of the company, boosted the number of directors on Caesars’ board to 12.

Icahn, in a statement, wrote that he looked forward to working with Reeg and the board to maximise value for all shareholders. The efforts, Icahn added, include exploring strategic alternatives for the company’s digital business, one he described as “underappreciated”.

Speaking to iGB, Reeg noted: “Carl sees the same thing we see in an undervalued equity and an opportunity to change that through digital.”

In the past, Reeg and his finance team have been lauded by Icahn for their ability to reduce debt. Caesars faces some obstacles considering the company ended 2024 with a considerable debt load. As of 31 December, Caesars had $12.3 billion in the aggregate principal amount of debt outstanding, according to company filings. At the time, the company also had total cash and cash equivalents of $866 million, excluding restricted cash of $150 million. Caesars is eyeing a target leverage ratio of 4x by the end of 2026.

Q1 earnings near

Despite spiking 7% in Tuesday’s session, Caesars is among a number of gaming stocks that have come under pressure due to macroeconomic concerns from a prolonged global trade war. Caesars shares are still down nearly 20% year to date.

Investors will receive more colour on Caesars’ long-term digital plans at next week’s quarterly earnings call. Caesars is scheduled to report earnings on 29 April, one day after BetMGM. The company will also release 2025 first-quarter earnings, a day before MGM Resorts is scheduled to address analysts on a quarterly call. MGM Resorts collaborates in a 50-50 joint venture in BetMGM with Entain.

Caesars Entertainment is expected to post a quarterly loss per share of $0.18 according to Zacks Consensus Estimate, an improvement of 67.3% from the year-ago quarter. For the first quarter, analysts project revenue of $2.79 billion, an increase of about 1.8% from the same quarter in 2024.

Reeg did not provide a timetable on when Caesars plans to make a decision on the potential spin-off. Nevertheless, he appears encouraged by the future prospects for the digital unit.

“Our goals are in our windshield,” Reeg told iGB. “Now we just have to get there.”

During our in-depth conversation with Dry, we explored the disciplined, analytical and occasionally counterintuitive realm of professional betting. Although he kept his “secret sauce” under wraps, he spoke openly about the mindset, processes and curiosity that have guided his success.

Early days

Dry’s journey began fittingly, with a winner. His first ever wager, an 8/1 shot at Goodwood, obliged when he was just nine years old. Still, he didn’t set out to become a professional bettor. He studied history and French at Durham University and, like many graduates, initially looked towards more conventional career paths. It wasn’t until after university when Tom would start dabbling in football betting and he was quickly drawn in by the analytical challenge it offered.

Fate intervened when his father spotted a recruitment advert for Starlizard, the data-driven gambling syndicate founded by Tony Bloom – widely recognised as the world’s best football bettor and the owner of Brighton & Hove Albion Football Club. As Dry did his own research, he was quickly convinced that working on betting edges was a far more appealing career choice. He applied and was offered the position.

The data approach to sports betting

At Starlizard, as with most betting syndicates, the focus is firmly on data. Much like a quant hedge fund, these operations build statistical models to derive accurate probabilities. Everything is factored into these models: form, venue, weather conditions, historical performance and more. When the model’s implied probability differs from market prices, there is a potential edge to exploit. Over thousands of bets a year, those edges compound – assuming the models are continually refined and executed with iron discipline.

Bloom’s data-backed philosophy also underpins his success as owner of Brighton & Hove Albion Football Club. Under his stewardship, Brighton have gone from League One to the top tier of English football and, in 2023, the club reached new heights by qualifying for the Europa League for the first time. Their transfer dealings are a testament to the approach:

Brentford FC, owned by Matthew Benham – founder of the Smartodds and a former colleague of Bloom – reflects a similar story. Benham and Bloom pioneered the now-ubiquitous “expected goals” metric, profiting from it in their betting.

Benham has invested around £100m in Brentford over the past 15 years and the club is now reportedly valued at over £400m, with Rothschild appointed to explore a potential sale of his majority stake (source: Sky News). Despite operating with a fraction of the budgets of Premier League giants, both clubs continue to outperform.

Starlizard days

When Dry joined Starlizard in 2017, his role centred on fine-tuning the football model to capture factors that are difficult for a model to incorporate: team and player motivation, injuries, squad rotation, off-pitch dynamics… in short, adding human insight and sense-checking machine-calculated probabilities. That, Theom argues, is when models become truly valuable.

Dry credits much of his development to the culture at Starlizard. It was flat, ideas-driven and there was no such thing as a stupid idea, as the only goal was to improve the model. In other words, if you thought a factor was relevant in determining outcomes, there was a chance to test it.

During his time there, Dry began betting personally at a more serious level, focusing on golf and snooker. In snooker, he developed a computer vision model that mapped ball positions and calculated shot difficulty. The edge was significant, but the markets lacked the liquidity to accommodate his desired volume. By this point, Dry knew that betting for himself was the long-term goal – the bets were becoming increasingly meaningful.

Going solo

‘The foundation of a winning model is unique exclusive, data, that has been crafted by people who really understand the sport’

Tennis was a natural fit. Dry had played from a young age with his brother and knew the sport intimately. It offered global scale, year-round events, deeper liquidity and an opportunity to build an edge.

In today’s AI-driven world, scraping public data is easy. Everyone has access to the same surface-level stats. But that’s not an edge. Real edge comes from understanding what actually matters in determining outcomes and building proprietary datasets to test those hypotheses, based on insights others aren’t looking for.

Know your sports betting strengths

Dry puts a huge emphasis on domain expertise. His team is made up of people with thousands of hours of tennis experience – former players, coaches and obsessive students of the game. Interviews are conducted by watching matches together over Zoom, where candidates must demonstrate a deep understanding of point construction, momentum shifts and the tactical nuances that shape results.

He is focused on what he knows. When asked if he would ever consider betting on cricket, he jokes: “My top score is 13.” Even in tennis, his early attempts at modelling the women’s game fell short. It was a reminder that edge doesn’t come from data alone. It comes from understanding the game on a level others don’t.

Mentality

Dry’s approach is best captured by a line he now lives by: “It’s better to sleep well than to eat well.” He prioritises long-term sustainability over short-term gain, favouring discipline and pragmatism over theory.

He’s sceptical of rigid frameworks – both in staking, like the Kelly Criterion and in modelling – arguing that while models are useful, they are only reliable up to a point. “You need at least 1,000 IQ points to beat trial and error,” he jokes. The key, he believes, is staying flexible and letting experience drive adjustments.

His reading list for aspiring bettors:

• The Black Swan – Nassim Nicholas Taleb
• The Signal and the Noise – Nate Silver

For Dry, a thriving betting operation doesn’t hinge on one “secret sauce”. It is about constant refinement – synthesising data, expert insights and a measured mindset to spot opportunities where others see only noise.

Waterhouse VC (a fund for wholesale investors) holds a blend of diversified global listed equities and unlisted investments, leveraging the Waterhouse family’s core areas of expertise. The portfolio is split across three pillars: Option Deals, Global Equities and Professional Betting.

Since inception in August 2019, Waterhouse VC has achieved a gross total return of +3,227% (annualised at 87.2%), as at 31 March 2025, assuming the reinvestment of all distributions.

But two submissions from prominent trade groups in Nevada and New Jersey, America’s top gaming states, indicate that the commercial industry is just as unhappy with how things have unfolded.

Prediction markets have operated for years but have come to the forefront in the last six months. In October, the New York-based exchange Kalshi prevailed in federal court to offer election betting despite objections from the CFTC. That opened the floodgates for Kalshi and others such as Robinhood and Crypto.com. Billions of dollars worth of election contracts were traded in November and the platforms have since begun offering sports contracts.

This latest development has caused an uproar from several sectors, including gaming operators, state regulators, financial groups and responsible gaming advocates. As federally legal exchanges, prediction markets are permitted in all 50 states. They also are not currently considered sports betting and therefore do not pay state betting taxes.

Those issues, as well as consumer protection concerns, have dominated opponents’ arguments. In response, the CFTC has arranged the upcoming roundtable, but the commission’s stance on the issue is unclear following the change in presidential administrations.

Donald Trump Jr, son of US president Donald Trump, was named as an adviser to Kalshi in January. Additionally, Trump’s nominee as the next CFTC chair, Brian Quintenz, is a Kalshi board member.

Nevada group touts state’s gaming influence

In gaming debates, Nevada likes to throw its weight around as the preeminent market in the US. Most of the time this is done in a celebratory fashion that honours the state’s gaming heritage dating back to legalisation in 1931.

However, on 3 April, the Nevada Resort Association (NRA), the most powerful trade group in the state, took a different approach. The response to prediction markets was more authoritative, more “Who do you think you are? I AM!”, a la bowler Peter Weber. Rarely do Nevada stakeholders appear so angered.

“Nevada stands as the nation’s home for legal gaming and we have spent decades offering safe legal sports betting to Americans,” NRA president and CEO Virginia Valentine asserted in the group’s submission. “Allowing for sports wagering to happen outside of state regulated channels puts citizens at risk and endangers the critical economic support gaming provides.”

Valentine added that when PASPA was overturned in 2018, “other states began legalising sports betting and the first place they came to was Nevada for guidance”. Dozens of other states, Valentine wrote, “are now experiencing the benefits of a legal regulated sports betting market that Nevada has long known”.

Despite the association’s pronouncements, the Silver State is already down 1-0 in its legal fight against Kalshi. The Nevada Gaming Control Board issued a cease-and-desist to the platform on 4 March. Kalshi sued in response and was granted a preliminary injunction earlier this month. Gaming attorney Andrew Kim wrote in Dustin Gouker’s Closing Line newsletter this week that the war is far from over, but Nevada certainly has its work cut out if it hopes to rid the state of the platforms.

New Jersey group points to years of PASPA work

If Nevada is the historical “gold standard” for gaming, New Jersey is certainly the modern equivalent. The Garden State legalised casinos in 1977 and igaming in 2013 and was the driving force behind PASPA’s repeal, which effectively created the sports betting industry as we know it today.

This latter point was the key argument from the Casino Association of New Jersey (CANJ), whose submission is dated 2 April. If the NRA was channelling Peter Weber, the CANJ seemed more like Rodney Dangerfield, asking for respect.

“New Jersey fought for almost a decade to bring legalised sports betting to our state and the rest of the country,” wrote CANJ president Mark Giannantonio. “Our state policymakers knew people were betting on sports, but they were doing so illegally and with no consumer protections. Our state, like all states, was also losing billions in tax revenue that could be used to better fund education, infrastructure projects and any other initiative our legislature determined.”

Those years of legal work in turn helped other states launch their markets. But as Giannantonio wrote, those choices “were made intentionally to ensure that the legal sports betting industry in New Jersey provides a safe and responsible way to bet on sports and provide economic value to our state”. Federally sanctioned prediction markets, he argued, undermine those efforts.

Kalshi was also served a cease-and-desist from the New Jersey Division of Gaming Enforcement on 27 March. The platform has countersued there as well, but a hearing scheduled for earlier this month has been moved to 30 April, the same day as the CFTC roundtable.

“Together with the federal states, we will improve the fight against illegal gambling,” the parties write on page 92. A brief statement, but in the eyes of many industry spectators, one that could prove significant.  

Germany’s new government has a daunting task ahead of it when it enters office on 6 May. In recent years, the country’s economy has been buckling under the weight of numerous structural problems, from an aging population to endless red tape.

Together, the centre-right alliance of the Christian Democratic Union (CDU) and Christian Social Union (CSU) and the centre-left Social Democrats (SPD) are tasked with getting the country back on its feet.

So far, the parties have set out a range of plans to do just that: a €500 billion infrastructure fund, a bonfire of bureaucracy, incentives for employees to work overtime and cuts in corporation tax from 2028. 

How big is Germany’s black market? 

Yield Sec, an intelligence platform charting illegal gambling activity across the globe, has been following the German market closely for several years.  

Its data paints a picture of a thriving illegal market – and one that is growing year on year. In 2023, there were 1,620 unlicensed operators targeting the German market, with 13.5 million Germans interacting with these operators throughout the year.  

By 2024, 1,926 illegal operators were actively targeting Germany, interacting with 15.8 million people, or around 20% of the population. This was a year marked by back-to-back football and betting opportunities, allowing illegal operators to reel in new audiences and cross-sell other products.  

Last year, Yield Sec’s figures reveal that around 54% of GGR was generated on the black market, accounting for around €4 billion in revenue. But with customers in Germany around five times more likely to encounter unlicensed operators online, Yield Sec CEO Ismail Vali believes it could be heading towards a figure as high as 88%. 

Tough gambling licensing laws in Germany  

Since the market opened in Germany, legal operators say they are fighting a losing battle against the illegal market. Many of their issues stem back to the federal system, which puts online gambling in the hands of the 16 federal states.  

Since the Interstate Treaty on Gambling came into force in 2021, effectively regulating the betting and online gaming market, those who opted to secure a licence have been crippled by tough regulations, slow approval procedures and high taxation.  

The strict measures – which forbid online slots providers from using the word “casino” for example – represent a compromise between warring regional factions. Although CDU and CSU-led regions are keen to unshackle the market, they have been faced with fierce opposition in a number of gambling-sceptic states.   

According to Yield Sec’s data, this has created a situation where illegal operators can offer 9.2x more products than those on the legal market.  

“Criminal groups are basically saying, we’re offering choice and convenience to German consumers,” says Vali. “We’re offering that without KYC, without restrictions, and without the self exclusion scheme too.” 

A more rational conversation within government

Against this backdrop, Wulf Hambach, founding partner at the Munich-based law firm Hambach & Hambach, believes the influence of the federal government could be a positive one. 

Having set themselves the task of battling the illegal market in the coalition pact, the CDU, CSU and SPD will have to take a much more active interest in the state of the country’s gambling regulations, he explained. This could be the first step towards a wider reform of regulations. 

“If they see that the black market is growing, that would be a failure,” says Hambach. “The federal government doesn’t want to have a failed policy right out of the door when it comes to tackling the illegal market.”  

Until now, liberalisations of the restrictive Interstate Treaty have been largely blocked by a handful of SPD-run states. In Bremen, for example, interior minister Ulrich Mäurer has repeatedly called for even tougher restrictions, including a complete ban on sponsorship and advertising.  

Such restrictions, Hambach says, would “only intensify the counterproductive prohibitive path that channels the consumers even beyond EU-borders”. 

At the federal level – and particularly in the less gambling-sceptic CDU – the political voices tend to be more rational. “They will take a closer look at market developments and I’m quite positive that they will find new answers to regulate with the upcoming reform of the Interstate Treaty,” the legal expert explains.  

Although this is largely in the hands of regional governments, external pressure from the national government could help to break the deadlock. As Hambach points out, the states also need the support of the national government, since criminal and tax law enforcement is required to crack down on illegal operators from abroad. 

“However, since you cannot just export national criminal law rules abroad, the situation is as it is,” he adds. 

“A big step forward” 

For the German Online Casino Association (DOCV), the fact that the coalition even mentions illegal gambling in Germany can be seen as a “big step forward” for the industry.  

“The DOCV expressly welcomes the fact that the presumably new federal government has named the fight against the illegal gambling market as a fixed goal on its agenda,” president Dirk Quermann said in a recent statement, adding that the step was “long overdue”. 

Nevertheless, the trade association believes politicians should collaborate more with the industry and turn political objectives into concrete action – particularly when it comes to strengthening licensed operators.  

Among other things, the DOCV is calling for Germany’s stake tax on virtual slots to be replaced with a tax on gross gambling revenue (GGR). They also want to see an end to the €1 maximum stake limit, a scrapping of the maximum five-second spin rule and the effective use of IP blocking against illegal operators.  

“We need to channel players from the unprotected black market back into the legal market, as this is the only place where player protection can be guaranteed,” said Quermann. “This can only work if we strengthen legal gaming.” 

A similar stance was taken by the German Sports Betting Association (DSWV). In a statement on their website, the sports betting trade association said they “welcomed” the statement from the incoming government but found it to be “vague”. 

In the view of the DSWV, five key steps should be taken by the federal and state governments to tackle Germany’s illegal gambling sector, including setting up a national prosecutor’s office and cracking down on advertising platforms and affiliates that work with the black market.

However, much like the DOCV, the association said the most effective weapon is creating a “strong legal market”. 

Urgent imperatives  

Largely due to Germany’s federal system, it was a long and arduous journey towards opening the legal market in the first place. With the 16 states and their respective coalitions all having a say in gambling regulations, there is often a glacial pace of change. 

As in neighbouring Austria, however, Germany is a country facing major holes in its finances. Many of the promises laid out in the coalition pact are “subject to financing” – and the money has to come from somewhere.  

This is giving industry stakeholders some hope that the government will be motivated to tackle the illegal gambling problem in Germany.   

“The fact remains that the new government needs money,” Christian Heins, Tipico’s director of igaming, wrote in a recent post on LinkedIn. “Of course, they could continue to raise taxes, but Germany is already a high-tax country. Illegal gambling is undoubtedly an untapped resource.” 

According to Heins, the new coalition could add around €1 billion per year to its coffers from the illegal gambling industry. That’s not including the multiple billions they might try to recoup from previous years. 

Furthermore, illegal operators are highly visible at major sports and industry events, including Formula One and international football, Heins wrote. “I hope that despite a less-than-ideal start that doesn’t exactly inspire a sense of renewal so far, the incoming government will take this issue seriously.” 

Days earlier, Kalshi had reported handle of $86 million (£65 million/€75.6 million) during The Masters tournament, roughly three times the volume traded on the platform for the Super Bowl. Over the last month, Kalshi and other prediction markets have been subject to a wave of cease-and-desist orders from states around the country. The litigation comes as the US Commodity Futures Trading Commission (CFTC) prepares this month for a highly awaited roundtable on the regulatory implications of sports event contracts.

Operating tax free on trading revenues, prediction markets pose an existential threat to the regulated gaming industry in the view of some industry lobbyists. Hornbuckle, the CEO of MGM Resorts, appeared on a keynote panel at the East Coast Gaming Congress in Atlantic City on Tuesday.

“If we don’t handle this correctly, it’s going to be the cement that’s being poured for the federal government to enter the space,” Hornbuckle told iGB on the sidelines of the conference.

Federalism versus states’ rights

Nearly seven years have passed since the US Supreme Court overturned PASPA in a historic decision that essentially opened the floodgates for legal sports betting nationwide. The nation’s highest court ruled that by prohibiting states from authorising sports betting, PASPA violated the anti-commandeering rule of the 10th Amendment. Writing for the majority, Justice Samuel Alito held that the provision unequivocally “dictates what a state legislature may and may not do”.

Four conservative justices concurred, along with two members of the liberal bloc. Alito went to great lengths to explain his argument on the anti-commandeering provision. In the event that state legislative bodies were put under direct control of congress, the justice outlined a scenario in which federal officers could be installed in state legislative chambers. To buttress his argument, Alito asked if federal officers had the authority to prevent state legislators from voting on offending proposals.

“A more direct affront to state sovereignty is not easy to imagine,” the justice wrote.

Upending state laws on gambling?

As one of the world’s largest casino corporations, MGM Resorts has more than a dozen casinos in Nevada, including 10 on the Las Vegas Strip. When former Nevada governor Fred Balzar signed Assembly Bill 98 into law in 1931, the state became the first in the nation to legalise casino gambling.

Within the state, former UNLV law professor Jennifer Roberts noted after the PASPA decision that sports betting should be regarded as a traditional states’ rights issue, because gambling is “reserved to the states under the 10th Amendment”.

Years later, some take the position that prediction markets pose a threat of upending state laws established in the wake of the PASPA decision. Asked on Tuesday if the Kalshi case may set precedent on the conflict between federalism and states’ rights in gambling, Hornbuckle indicated that he prefers the latter.

“It has always been, it needs to be and continues to be a states’ rights issue,” he told iGB.

Last week, a US district court judge granted Kalshi a preliminary injunction against the Nevada Gaming Control Board. The injunction prevents the NGCB from imposing an order against Kalshi contending that the site illegally offered sports wagering across the state. 

Over the last month, Kalshi has filed lawsuits against Nevada and New Jersey in response to such cease-and-desist orders. The states “fundamentally misunderstand” prediction markets, which are regulated by the federal government, Kalshi CEO Tarek Mansour wrote on his Twitter account.

The AGA’s position on prediction markets

American Gaming Association president Bill Miller appeared on the same panel with Hornbuckle on Tuesday. Miller returned on Wednesday morning for a separate panel on the state of the gambling industry in a changing political landscape. In addressing prediction markets, Miller shared Hornbuckle’s views opposing potential intervention from the federal government.

Kalshi gained momentum during the 2024 US presidential election when users traded more than $500 million in event contracts on the election. Since then, an exercise on wagering on the election has turned into an exercise on predictions, Miller opined. In his view, event contracts on sports violate provisions of the Indian Gaming Regulatory Act and the federal Wire Act.

“For those of us who are in charge of ensuring that the public believes we are acting in a responsible manner, and we are actually in touch with the elements of responsible gaming, it’s hard for me to see this as anything other than a threat,” Miller said during the panel.

Moreover, Miller believes that prediction markets “undermine” and “upend”  decades of state regulation and statutes on gambling. In the case of New Jersey and a few others, Miller said the markets “contravene” some state constitutions, which he describes as “problematic”. While a number of companies would prefer not to undergo the “rigours” of the state licensing process, the strict requirements provide reasonable safeguards to the market, he commented.

In relation to tribal gaming, CFTC regulations on prediction markets may pre-empt agreements between sovereign nations and the states, according to Miller. Hard Rock International and Seminole Gaming CEO Jim Allen also made an appearance at the conference on Wednesday. The Seminole tribe of Florida maintains a monopoly on mobile sports wagering across its state.

“I think at this time it’s a little premature to have any definitive position on it,” Allen told iGB. “But clearly we have to have an environment where there is investigation, where there is licensing.”

A CFTC roundtable on the future of sports event contracts will take place on 30 April, according to multiple sources. The CFTC has not formally released a list of participants.

These player losses cases, first brought to regional court in 2018, have questioned German gambling law under the previous treaty, but thousands have been settled either in or out of court over the years.  

How have player losses cases progressed to the ECJ? 

Last year a number of cases progressed to Germany’s Federal Court of Justice (BGH), including one case involving local operator Tipico. This is one of the four cases awaiting a European Court of Justice (ECJ) judgment.  

The progression of cases to the ECJ is significant, but Claus Hambach, managing partner at German law firm Hambach and Hambach, believes there were always signs that cases would be referred to the ECJ eventually.  

“From the very beginning, [there were] a lot of indications why cases should be referred because the inconsistency of the German regulation is rather obvious,” he tells iGB.  

“The civil courts tried to reason and argue without considering European law and just ignored the necessity to make such referrals. And then two years ago, a Maltese court referred a German-related case to the ECJ. Only after that referral, German courts also referred questions to the ECJ.”  

Part of the reason why cases have progressed to the European court is that German gambling law is hugely complex and, prior to the 2021 treaty, there was a lack of a licensing framework as the market was largely considered grey.  

The argument in many cases has been whether the 2012 edition of the State Treaty on Gambling contained a level prohibition on sports betting without a licence. This meant offering sports betting could be considered a violation of the legislation and the sports betting contract between the player and the operator could be deemed as void.   

Hambach says German gambling law is complex, particularly as states operate their own rules, as well as adhering to an overarching federal law.  

As cases have progressed, the argument has shifted to whether German law contradicts a certain European law, which guarantees the freedom to provide services within the EU.  

What is the latest argument to be heard by the ECJ? 

One of the four pending cases was brought to the ECJ via a Maltese court. The initial hearing was held last week on 9 April. Defendants European Lotto and Betting Ltd and Deutsche Lotto-und Sportwetten Ltd raise questions on whether it is reasonable for locally regulated markets to prohibit online casinos licensed only in Malta.  

While the current ECJ case relates specifically to Germany, Hambach says it could have implications for other European markets. That’s particularly the case if the ECJ sides with the claims that Malta-licensed operators should have freedom to operate across the EU, regardless of local regulations.  

In February, a Maltese court ruled it would no longer enforce judgments on player losses made by Austrian courts. The case was also brought by European Lotto and Betting Ltd.

The ruling, delivered on 27 February, backed Malta-licensed operators that had done business in Austria’s market without a local licence. The court ruled that previous Austrian judgments were contrary to Maltese public policy.

Hambach believes the litigation financing companies funding many of the ongoing player losses cases are becoming anxious now that these cases are at a European level.  

On 10 July the Advocate General will deliver his opinion on this case, at the ECJ’s Palais de la Cour de Justice in Luxembourg. The final ruling will occur up to six months later. It could dismantle the model these financiers have built to earn a percentage of the winnings won by players.  

European Lotto and Betting Ltd, operating as Lottoland, declined to comment on the ongoing case when contacted by iGB.  

Ultimately, Hambach says he is unsure how the court will rule. But it is clear the case is having an impact on the player losses case model which has riddled operators in Germany and Austria.

How could the current player losses case model be impacted?

Hambach says a number of cases were withdrawn from regional courts that intended to refer questions to the ECJ, as it would be in the financiers’ favour for them to reach that level.

“They tried every possible path to prevent a referral to the ECJ, because they don’t want it. In Germany they had a rather secure situation as many courts decide in favour of the players. But now many courts suspend the proceedings until the ECJ has decided. But they are also fearful of any [opposing] view by the ECJ and I think that fear is understandable,” he says.  

Munich-based lawyer István Cocron was among the first to represent players in 2019. He says regional courts were largely ruling in favour of the players and the model was quickly picked up by litigation financing companies, which started offering to fund cases for a percentage of the winnings received.  

But some of these financiers have already disappeared from the German market as uncertainty around the future of these cases has increased.  

The case will surely raise further questions around the EU’s role in gambling law across Europe. There are no unified European regulations for gambling, beyond the rule requiring freedom of movement within EU member states.

After the Liberation Day announcements, global markets responded with a precipitous multi-day sell-off that wiped out trillions in value.

The S&P 500, Dow Jones Industrial Average and the Nasdaq Composite all fell by 5% or more in back-to-back days to close last week’s trading. Collectively, last week was the worst for financial markets since the onset of the Covid pandemic in 2020.

Gaming companies across the industry were hit hard by the sell-offs. Retail casino operators, both regional and destination, were especially vulnerable, with the stock prices of Wynn Resorts, MGM Resorts, Caesars and others dropping in some cases by 10% or more. Suppliers faced similar declines due to their reliance on supply chains and manufacturing. Online-facing companies fared better but were still generally down 5% or 6%.

Up, up and away

But things changed Wednesday when Trump suddenly reversed course and announced a 90-day pause on the reciprocal tariffs, which were due to come into effect that day. China was the only country not to see a reprieve – its rate was hiked to 145% and, in turn, Beijing enacted 84% tariffs on US goods.

The pause triggered a staggering resurgence that resulted in one of the best single-day market performances in history. All told, the Nasdaq soared 12% and the Dow and S&P climbed back 8% and 9.5%, respectively, on Wednesday.

“I did a 90-day pause for the people that didn’t retaliate, because I told them, ‘If you retaliate, we’re going to double it,’” Trump said, per NBC News. “And that’s what I did with China, because they did retaliate. So we’ll see how it all works out. I think it’s going to work out amazing.”

Optimism appeared short-lived, however, as major indices were again down at least 2.5% at close Thursday.

Reason for stakeholder concern

As a consumer discretionary industry, gaming is always seen as susceptible to economic downturns. Many retail casinos faced their first-ever closures during Covid in early 2020, but supply chain impacts were the longest-lasting. The American Gaming Association (AGA) has again warned of those potential headwinds.

“As an industry reliant upon a global supply chain, we are actively monitoring developments and we are engaged with multiple stakeholders in advocating for continued dialogue with key trade partners that enable the economic growth and impact our industry provides in communities across the US,” AGA’s senior vice president of strategic communications, Joe Maloney, told iGB.

The Association of Gaming Equipment Manufacturers (AGEM) declined to comment. AGEM represents 12 gaming suppliers from around the world and publishes a monthly index of its members’ stock performances.

In March the AGEM Index was at 1,615.74, representing a 9.3% decline year-on-year. All 12 members reported declines, which AGEM said was “among a broader decline for all three major US stock indices amid uncertainty over federal tariff and trade policies”.

Analysts uncertain

The recent market seesaws have made for great business television and fanatical headlines. Yet gaming analysts are for the most part just as perplexed by the macroeconomic environment as the public.

Lloyd Danzig, managing partner at Sharp Alpha Advisors, put it simply: “It is very hard to make predictions about short-term movements in equity valuations at this time.”

“No one really knows how this will end,” said another analyst who responded on the condition of anonymity. “The market clearly reacted to this, we don’t know what’s going on, we don’t necessarily trust that it will continue like this. If it does, it will get for worse for these stocks.”

The analyst went on to add that in times of uncertainty, “Typically for gaming investors, it’s sell now, figure out the answer later when we have some clarity.”

Another analyst posited to iGB that perhaps the toughest part about analysing the tariffs is “how it filters down to wallet share”. The source pointed to the gaming real estate investment trusts (REITs) as perhaps being safer due to their long-term business models.

Digital companies could emerge as winners

The onset of the Covid pandemic was in some ways an economic boon to digital companies, as players in legal online sports betting and igaming states opted to play from home for smaller stakes rather than splurge on retail casino visits (after the venues reopened). That same logic could apply again here. Five years post-Covid, there are also several newly legalised online markets.

One source said that “placing a few wagers on a single game is viewed as ‘low denomination’ versus other forms of entertainment spending habits” so gaming could withstand economic swings better than other sectors.

Danzig noted that while “the market has moved to a risk-off positioning with extra focus on regulatory risks”, sports betting is something that “tends to correlate with high-beta risk-on assets”. Lottery sales could also be something to monitor during such times, he said.

Fantini: Grey market complicates things

Frank Fantini, principal of Fantini Advisors, has analysed gaming stocks through several significant market events, including the Dotcom crash of the early 2000s, the 2008 financial crisis and most recently the Covid pandemic. He told iGB that with the S&P trading at a price-to-earnings ratio above 25x following multiple great years of performance, some could argue that the market was overpriced and therefore a significant correction might have been coming anyway.

However, he posited that this latest market event could be especially worrisome for gamers due to the increase in competitors operating outside state regulations of any kind.

“It seems to me the greatest threat to gaming investors are the creeping kind of grey markets,” he said. The three examples Fantini alluded to – sweepstakes, skill games and prediction markets – have all dominated the industry’s attention of late. Sweepstakes and prediction markets primarily affect online businesses, while skill games have long been a thorn in casino operators’ sides. None of the three appear to be losing momentum anytime soon.

On the topic of casinos, Fantini said regional operators might be better positioned for a recession-type environment.

“I would think that if we have a recession, the regional markets would fare relatively better than, say, Las Vegas,” he said. “Regional markets don’t have as much of a convention business to lose. They also do not rely so much on people spending big on vacations. The other question is how much of this tariff impact is emotional, opinionated? If you’re Canadian, do you really want to go to the US after [Trump] has insulted you by saying you should become the 51st state?”

Matt Rybaltowski contributed to this report.

A litany of civil complaints against RWLV and several other Strip properties have given regulators agita, with one Nevada commissioner warning that the financial improprieties would serve as a wakeup call for the industry as a whole.

Given the severity of the allegations, one option for state regulators involved placing RWLV into conservatorship, a strict penalty that would have ranked among the harshest available. Alternatively, a $100 million fine ($£77 million/€89 million) in combination with a licence suspension could have been just as punitive, or even worse.

In the end, the Nevada Gaming Commission (NGC) approved a $10.5 million fine against RWLV. It is the second largest fine levied against a casino in state history.

The settlement served as a hot topic at last week’s Indian Gaming Tradeshow & Convention, the nation’s largest tribal gambling conference. A stipulated settlement finalised by the NGC on 27 March resolved a 12-count regulatory complaint centred on the casino’s anti-money laundering deficiencies.

Numerous panels addressed the settlement, as well as the sweeping investigation into the Southern California illegal sports betting market, which occupied a central role in the RWLV case. One panel discussing the casino industry’s evolving anti-money laundering landscape delved into the challenges compliance teams can face when designing a remediation plan following a major settlement.

“Having compliance in place can’t be so detrimental to the business that the business cannot function,” said Anne Layne, senior manager at Grant Thornton, one of the largest US accounting and advisory firms.

No admissions of wrongdoing

Last summer, the Nevada Gaming Control Board issued a multi-count complaint against RWLV, a 117,000-square-foot casino located on the north end of the Las Vegas Strip. Opened in 2021 at a cost of $4.3 billion, the resort is the most expensive property in the history of Sin City. The settlement pertains to criminal charges against two illegal bookmakers, both of whom are awaiting sentencing on federal money laundering charges.

One bookmaker, Matt Bowyer, has garnered headlines for his association with Ippei Mizuhara, the former interpreter for Los Angeles Dodgers star Shohei Ohtani. For a three-year period, Mizuhara placed approximately 19,000 wagers with Bowyer’s illegal sportsbook, amounting to more than $325 million in handle. Bowyer, meanwhile, gambled at RWLV on at least 80 occasions, losing at least $7.9 million, according to a Nevada regulatory complaint.

Mizuhara, who admitted embezzling more than $16 million from Ohtani to feed his gambling habit, received a 57-month prison sentence in February. The former interpreter is scheduled to surrender to federal authorities by 12 May.

Despite several meetings discussing Bowyer’s activities, the casino’s AML committee failed to substantiate that Bowyer’s source of funds matched his volume of play. According to the complaint, RWLV never performed the required Know Your Customer check on the bookmaker. Investigators also probed whether the casino’s sportsbook enlisted illegal bookies as an avenue for laying off excessive risk.

The NGC approved the settlement on a 4-0 vote, with commissioner Abbi Silver recusing herself from the matter. She cited a longstanding relationship with Scott Sibella, a former RWLV president. Sibella was sentenced last May to a year of probation. He later had his Nevada gaming licence revoked for AML violations during his tenure at the MGM Grand. RWLV has not admitted to any wrongdoing in relation to the complaint.

Striking a balance

The tribal conference panel discussing AML issues spent a large portion of the hour-long session on the RWLV matter. In addressing a room full of compliance officials, the panel outlined the remediation strategies available when costs become an issue. As a rule of thumb, compliance teams should focus less on passing an exam when approached by regulators, Layne said. Instead, the teams should focus more on developing a framework that prevents activity that can land their casino in hot water.

One option for regulators centres on stipulations that would require affected casinos to hire an independent AML monitor. The third-party monitors could be utilised to tackle suspicious activity in real time, on a 24/7 basis. From a compliance perspective, the presence of such a monitor would be “fantastic”, Layne suggested. While the remediation appears logical in theory, however, the high cost burdens can make implementation less practical.

A stipulation that requires a casino to pay a third-party monitor could cost so much it becomes detrimental, Layne explained. At the same time, regulators are acutely aware of how sanctioned casinos still need to generate revenue during a comprehensive remediation. On a macro level, state bodies are incentivised to assist casinos with their recovery in order to maintain tax proceeds and revenue share from the property, she noted.

“While compliance is important, it is also important to make sure that the businesses can continue – it’s really about striking a balance,” Layne said.

A federal settlement?

Layne was joined on the panel by Sean Topchi, an executive who serves as director of business development at Kinectify. Topchi is intimately familiar with the facts of the RWLV case since he was formerly employed as the Bank Secrecy Act officer for Morongo Casino Resort & Spa, a large tribal casino in Southern California. Topchi was quick to note that a considerable amount of remediation has already been implemented by RWLV, including a new corporate governance structure.

Nevada regulators still have the option of revisiting the settlement if there is criminal or civil action taken on the federal level, Topchi noted. At last month’s hearing, Nevada Commissioner Brian Krolicki indicated that the option represented one of the most integral aspects of negotiations. Topchi believes the federal probe may be “close to the finish line”, resulting in a “decent” chance of a settlement by the justice department.

At a separate session in San Diego, federal prosecutor Jeff Mitchell gave a presentation on methods to combat money laundering. Mitchell, an assistant US attorney for the Central District of California, specialises in complex matters related to bank fraud, money laundering, tax offences and Title 31 BSA issues, among others. He is also lead prosecutor in the intertwined Southern California gambling probe.

Mitchell addressed several adjudicated cases involving Mizuhara, Sibella and the MGM Grand, but he did not discuss Bowyer’s ongoing case.

Initially scheduled for last week, Bowyer’s sentencing has been moved to October. Damien Leforbes, another bookmaker who pleaded guilty on money laundering charges, is scheduled to be sentenced in June.

Under the Biden administration, the federal government considered a nine-figure fine against RWLV, multiple sources told iGB. The status of any possible settlement appears to be unclear, due in part to the leadership transition in the justice department.

In the past, the Cougars’ defeat may have provided famed bettor Jim McIngvale with nagging indigestion, due to the Houston furniture store owner’s affinity for placing seven-figure bets backing the Cougars. Last year, the entrepreneur stood to make $15 million (£11.7 million/€13.6 million) if Kelvin Sampson’s team cut down the nets. In the run-up to this year’s Final Four, though, no large bet from McIngvale was publicised.

As part of an initiative to promote responsible gambling, the NCAA has urged bettors to gamble within their means. Throughout March Madness, the NCAA promoted its “Draw the Line” educational campaign about gambling risks, by both airing ads and using a courtside stanchion at the Final Four.

The effort comes amid a litany of scandal in the domestic sports betting space, including those in pro and college basketball. Over the last several months, a handful of schools have become ensnared in a federal investigation in connection with an illicit betting ring. The Final Four ended in San Antonio without a major breakthrough in the case.

Angry tweets

Last month, the NCAA held the East Regional in Newark, New Jersey, one of the first states to legalise sports betting after the 2018 PASPA ruling. Unlike most jurisdictions, New Jersey prohibits bettors from placing wagers on college events inside state lines.

Hours before tip-off, the New Jersey Division of Gaming Enforcement (DGE) issued a cease-and-desist order against a pair of prediction markets, Kalshi and Robinhood, that have expanded their options to include outcomes of sporting events. One day later, Robinhood’s New Jersey website removed markets on college basketball before a 28 March deadline.  

Duke’s Cooper Flagg, the 2025 Naismith Player of the Year, displayed his ability in Newark where he led his school to the Final Four for the second time in four years. In the regular season, Flagg guided the Blue Devils to a pair of victories over archrival North Carolina.

At last December’s congressional hearing on sports betting, Senator Dick Durbin of Illinois informed a packed crowd of a troubling anecdote involving former Tar Heels player Armando Bacot.

In last year’s Round of 32 matchup against Michigan State, Bacot scored 18 points and pulled down eight boards in an 85-69 win. Despite the victory, the brawny centre still received around 100 angry messages on social media for his failure to hit the “over” on his rebound total.

Downplaying the threats

Prior to a Sweet 16 matchup against Arizona, Flagg said that several of his Duke teammates have been subjected to similarly vengeful DMs from bettors on social media.

“We just kind of see it and laugh at it,” Flagg said in response to a question from iGB.

Flagg, the putative No 1 pick in June’s NBA draft, ended the season with averages of 19.2 points, 7.5 rebounds and 4.2 assists per game. But even Flagg can have a down game. Flagg missed the “over” on his total in Duke’s win over Alabama when he scored 16 points.

Grant Nelson, another NBA prospect from Alabama, echoed Flagg’s sentiments. Despite heavy wagering on college basketball around the country, Nelson indicated that his team largely ignores anything related to sports betting, focusing instead on their performance on the court.

In response to the wave of angry messages, NCAA president Charlie Baker described the level of bettor harassment of athletes as “absolutely unacceptable”. Baker has urged states with legal sports betting to ban props on college athletes.

“These actions severely threaten student-athlete mental health and well-being, while harming the college athletics environment,” Baker wrote in a statement.

Suspicious betting patterns

In January, federal law enforcement authorities apprehended a Las Vegas man before he could board a flight at Harry Reid International Airport. The individual, Shane Hennen, was placed under arrest as he attempted to travel to Colombia, via Panama. Hennen, a professional poker player, helped orchestrate an enterprise that conducted illicit financial transactions and fraudulent sports wagers “totalling millions of dollars”, according to court documents.

The ring is under investigation for a point-shaving scandal that Sports Illustrated described as potentially one of the “most pervasive” in North American sports history.

In 2024, sports betting integrity firm IC360 received several reports on unusual offshore betting patterns around Temple basketball games. One, in particular, a 7 March tilt against UAB, drew suspicion due to rapid line fluctuations, which is a marker for irregular activity.

A continuance in Hennen case

By last November, the probe widened, covering at least six Division I programmes, according to a source with direct knowledge of the investigation. Other games in question involved several mid-major programmes, including Eastern Michigan, North Carolina AT&T and Mississippi Valley State, ESPN reported.

The ring in which Hennen is implicated is also allegedly connected to a separate case involving former Toronto Raptors centre Jontay Porter, who is awaiting sentencing on conspiracy to commit wire fraud.

Last July, Porter admitted in Brooklyn federal court to deliberately underperforming in several statistical categories to manipulate a series of betting outcomes. The NBA banned Porter for life, as commissioner Adam Silver described his transgression as the “cardinal sin” in sports integrity. Hennen was the sixth individual arrested in the operation.

On 26 March, US magistrate judge Robert Levy signed an order granting a continuance in Hennen’s case. The continuance through 25 May gives attorneys additional time to complete a possible plea negotiation, according to court filings.

Educational outreach efforts

Kevin Young, a former assistant with the NBA’s Phoenix Suns, just completed his first season at BYU. In Newark during his school’s appearance in the NCAA Tournament, Young described a strict environment in the NBA where league officials spend hours educating players on the consequences associated with disseminating inside information that may be used for gambling purposes.

While BYU is not required to disclose its starting lineup until minutes before tip-off, the NBA has more stringent protocols on injuries, with teams compelled to reveal their inactive lists much earlier.

“Honestly, I’m a little surprised that college isn’t more that way,” he said.

Utah, where BYU is located, is one of just 12 states without legal sports wagering. Nevertheless, Young emphasised that the programme does its best to inform its players on the protocols around gambling and to ensure that they are “playing by the rules”.

Concern on props

BYU fell to Alabama 113-88 in the Sweet 16. In the nightcap, Duke also hit the century mark in a 100-93 win over Arizona.

On the national and institutional level, Arizona coach Tommy Lloyd believes efforts to educate players on the pitfalls of gambling have been sufficient. Of the recent sports betting scandals in general, Lloyd stated: “There’s some sick people out there who are taking advantage of those kids.”

Legislators in North Carolina filed a bill on Tuesday that aims to ban prop bets on college athletes. To date, 18 states and Washington DC have enacted bans on player props.

According to an American Gaming Association study released before March Madness, bettors were projected to wager approximately $3.1 billion combined on this year’s NCAA men’s and women’s basketball tournaments.

At last year’s Sweet 16, Illinois coach Brad Underwood mused that he doesn’t want to see a day when bettors will wager on the team that wins the opening tip. Lloyd also expressed concern at the volume of harassment levied toward players by enraged bettors.

“I don’t want them getting crushed for a free throw that caused the point spread to go one way or the other,” he stressed.

What had been a trickle became a flood after Las Vegas Sands Corporation’s Sands Macao changed the game in the city and its Venetian Macao launched a brave new world in Cotai, transforming an unwanted swampy landfill into the most lucrative casino cluster on the planet. 

The money flow out of China through the American-led growth of Macau’s casinos seemed to be an incredibly obvious potential friction point, the proverbial 800-pound gorilla on the gaming floor, but hardly anyone mentioned it back then. No publisher bought the book and the question went unanswered. 

While publishers were rejecting my book pitch, Xi Jinping appears to have had the same question on his mind and he didn’t need a publisher. When he became China’s leader in 2012, he wrote his own book. Xi’s administration cracked down on funds leaving the mainland beyond the legal limit of roughly US$5,000 per traveller per trip, culminating in the crackdown on leading junket promoters facilitating excessive money movements.

Macau and other Asian markets are still struggling to come to terms with the post-junket era. 

Irony rich formula 

As trade and political tensions escalate between the United States and China with Donald Trump’s return to the White House, Macau’s American casino operators seem like tempting targets for retaliation by Beijing. Not only do US-owned entities run three of Macau’s six casino concessionaires but, in a potentially irresistibly delicious irony, Trump once ran his own casinos – straight into bankruptcy. 

Via Hong Kong listed subsidies they control, American companies LVS, Wynn Resorts and MGM Resorts International have multi-billion dollar investments in seven integrated resorts in Macau, accounting for roughly half of the city’s gaming revenue (and gaming tax receipts). Melco Resorts, helmed by Lawrence Ho, has a US stock listing for its operating company. 

Moreover, Wynn Resorts founder Steve Wynn was a major Trump supporter in that failed casino mogul’s first presidential run. They became political allies despite a very public and publicised feud during the 1980s when they had Atlantic City properties bearing their names.

In 2018, when sexual harassment allegations arose that ultimately cost Wynn his ownership and executive control of the company he founded, his first act of recognition, if not contrition, was to resign as finance chairman of the Trump-led Republican party. 

LVS founder Sheldon Adelson was the largest donor to Republican candidates in 2016 and to Trump’s 2020 re-election campaign. His widow Miriam Adelson, now the LVS controlling shareholder, continued the family tradition in 2024. In 2018, Trump awarded Israeli-born Dr Adelson – she is an accomplished physician – the Presidential Medal of Freedom, the highest US civilian honour. 

Former US ambassador to Singapore Frank Lavin, now a visiting fellow at The Hoover Institution, Stanford University, tells iGB, “In my view, China is unlikely to directly challenge the ownership of Sands because they respect Miriam Adelson and her relationship with Trump – perhaps a little like their respect for [Elon] Musk.” 

Blurred lines for Macau’s casinos

“I no longer think about whether an IR operator in Macau is American or not since the passing of Sheldon Adelson and the retirement of Steve Wynn,” Intelligence Macau managing director Anthony Lawrance writes in an email.

“The corporate cultures of those two firms – Sands China and Wynn Macau – are now largely indistinguishable from their rivals (with the obvious exception of SJM, owned by a fragmented and largely dysfunctional family).”  

Lawrance adds: “I have never considered MGM China [chaired by US educated Pansy Ho and majority owned by MGM Resort International] or Melco to be foreign-owned. Their corporate cultures are a hybrid of American and Canadian Chinese, reflecting the mixed nature of their respective owners.” 

“I see the industry as international, with portable operators, each bringing a combination of attributes – and, potentially, challenges,” the Innovation Group president Michael Soll says.

“American operators in Asia have built a segment that is adapted from the US IR market, yet a fully Asian product being run collectively by primarily American companies and their Chinese counterparts.” 

High cost of winning 

In the round of concession bidding completed in 2023, all three American companies retained their Macau casino licences. All concessionaires are subject to the same policy directives and combined non-gaming investment obligations of more than $13.5 billion. LVS has the largest investment obligation of any concessionaire at $3.75 billion, with Wynn at $2.2 billion and MGM at $2.1 billion 

“With the emphasis on supporting Macau’s further development, such as rejuvenating the old area and its appropriate economic diversification, Macau would expect these companies to assume greater level of social responsibility,” Macau Polytechnic University gaming scholar Carlos Lam Siu says.

“Furthermore, as most Macau visitors are from China, it is critical for American companies to reinforce the ‘we are all in the same boat’ image despite the recent imposition of the US tariffs.” 

An associate professor at MPU’s Centre for Gaming and Tourism Studies, Siu says: “These corporations have demonstrated how the non-gaming segment could work with casinos, starting from fine dining and hotel accommodation to spectacular shows and concerts. Later, they have shown how to link shopping malls, artistic and antique displays with gambling, in the attempt of adding different flavours to gambling.” 

Siu adds: “With the need for Macau’s economic diversification, casino operators not only need to develop their own business, but also work with government to support other related industries like culture and sports, big health and high technology, not only for Macau but also for the Greater Bay Area,” encompassing Macau, Hong Kong and mainland China’s Guangdong province. 

Making Macau casinos world-class 

“Reflecting on the past 23 years, it’s clear that American investment has significantly influenced the development of Macau’s gaming and tourism industries,” Lektou Avogados managing partner Pedro Cortes says. “Since the liberalisation of the gaming sector in 2002, US affiliated operators have brought substantial expertise, innovation and operational excellence, helping to establish Macau as a world-class tourism and entertainment destination. 

“Over the last two decades, these companies have diversified Macau’s casino offerings by developing integrated resorts with a strong emphasis on non-gaming amenities, entertainment and international hospitality standards. Their contributions have supported Macau’s goal of becoming a global tourism and leisure centre, in line with the policies of the central government [of China] and the Macau SAR [Special Administrative Region] government.” 

“Francis Lui’s stewardship of Galaxy has shown that Chinese can own and operate an IR group just as well as Americans can,” Lawrance says. 

Adding value and variety 

Personalities and politics aside, Galaxy’s success, challenging Sands as the market leader and Stanley Ho’s successors and scions as Macau’s local champion, underscores a practical question: In 2025, are American companies still adding value in Macau? 

“From my observation, yes,” University of Macau assistant professor of business economics Ricardo Chi Sen Siu says. “The international brand name and reputation of American ownership and its market network still help to add value to the gaming industry in Macau. This is especially important when Macau is now putting in much effort to diversify its sources of visitors and to push forward the city’s development as a world-class tourism and leisure centre. 

“In addition, through competition between the American and non-American companies, variety and vitality of the market are maintained for Macau as an attractive casino tourism destination.” 

Exporting American ingenuity 

Soll says, “In the sense that American ingenuity in gaming has typically driven the global bricks and mortar expansion model, they will show up with the same or better tools to adapt to a new form of resort.”   

“American casino owners have demonstrated that they know how to turn a gaming-centric market into a non-gaming success story with the gradual evolution of Las Vegas into a multi-faceted tourism destination,” GMA Consulting founding partners Steve Gallaway, Josh Swissman and Kit Szybala write. 

“It’s about more than just building the non-gaming, you must make money on the non-gaming in order for them to be sustainable into the future. Americans bring that know-how.” 

Vegas leads the pack 

GMA adds, “Above all, Las Vegas is the bellwether for integrated resorts due to the natural evolution of non-gaming overtaking gaming revenue. Americans lead the way not only in this initiative, but also how to reward guests for both their non-gaming and gaming spend. In order to appropriately grow an IR market, both gaming and non-gaming must be respected.” 

“American companies still add value to the gaming sector with their entertainment options like movies and music related to the non-gaming segment,” Carlos Siu says. “Moreover, the Macau casinos sector can benefit from their multiple licences in different jurisdictions.” 

“I believe these companies will remain key stakeholders in Macau’s future, provided they continue to adapt to evolving policy priorities and actively contribute to the region’s economic and social objectives,” Cortes says. 

Fire sale or stable landscape? 

If the Americans in Macau want to sell, there’s the practical question of who might purchase their properties. Macau authorities would have to approve any buyer. 

“Potential buyers of American-owned casinos in Macau will be shaped by why the American operators are leaving the market,” the GMA triumvirate says. “If the landscape is stable and the operators are not forced to leave, there will be a multitude of interested parties; however, if American owned casinos depart the market due to geopolitical pressures, it will very likely limit interest in taking over their concessions.” 

“I cannot imagine a Chinese group from outside Macau coming in to buy out one of the American owners,” Lawrance says. “I think the only way Tillman Fertitta could offload Wynn’s assets in Macau would be to one of the existing concessionaires.” 

Ambassador Lavin doubts Beijing will relax rules barring mainland Chinese ownership of Macau casinos. 

To boldly go… away 

Las Vegas Sands’ 2021 sale of its Vegas Strip assets demonstrates US gaming giants will make bold moves to exit a valuable market. Since the announcement, I have suspected that sale was a prelude to Adelson’s heirs exiting gaming altogether.

In my mind, selling the iconic Venetian complex didn’t make sense otherwise: there’s no right price for priceless assets. Patrick Dumont, Miriam Adelson’s son-in-law, succeeding Robert Goldstein as CEO underscores that LVS is a family affair, capable of decisive action with the consent of the controlling shareholder. 

Beyond Macau, LVS still has Marina Bay Sands in Singapore, the world’s most profitable integrated resorts, and its most admired, along with high hopes for New York and Texas, where Adelson acquired the Dallas Mavericks basketball team and its arena. Beyond Macau, Wynn and MGM still have Vegas and more in the US, plus aspirations in the Gulf emirates. But all of that pales in comparison to Macau. 

American gaming companies in Macau have successfully written their own story, making themselves and Macau great again. They have adapted their US models to Macau casinos with sufficient aplomb for Macau to become several multiples bigger than Las Vegas in terms of gaming revenue, $28.3 billion last year to the Strip’s $8.8 billion. 

Seizing the narrative 

Now powers beyond their control in Washington and Beijing are largely writing American casinos’ Macau stories for them. Tensions that Trump stoked during his first term continued to simmer under Joe Biden and they’re boiling again with Trump’s return to the Oval Office. Geopolitical realities will almost certainly heighten those tensions for the foreseeable future. 

Furthermore, Macau depends on Beijing’s goodwill for its success now more than ever. For American gaming executives who abhor uncertainty, helplessness in the face of superpower machinations must keep them up at night, or at least give them agita before they sleep.

While experts contend all will be well, they said the same thing about those earlier massive cross border money movements. It seems something has got to give. 

For the Americans in the Macau casinos sector, there’s still a chance – for who knows how long – to write their own story. They can still seize the narrative to escape a relationship that began with ping pong diplomacy now devolved to a potential toxic tit-for-tat with their Macau casino assets poised for paddling.

Yet, given the stakes involved and their limited options, LVS, Wynn and MGM may be best served by taking the advice I have given my daughter for as long as she can remember: Don’t become a writer unless you absolutely have to. 

Muhammad Cohen is a former US diplomat and current iGB Asia editor at large. He has covered the casino business in Asia since 2006, most recently for Forbes, and wrote Hong Kong On Air, a novel set during the 1997 handover about TV news, love, betrayal, high finance and cheap lingerie.

Adjusted EBITDA for the year increased 4% to £312 million for the group, again largely driven by H2 profitability. Up to 63% of the adjusted EBITDA related to the second half of the year. When looking at EBITDA, H2 accounted for 85%, versus the first half of the year.  

The operator said it had “achieved all commitments outlined in its H1 results to deliver a significant step change in profitability in H2”.

This included “a £30 million cost saving programme, more effective marketing that is focused on our core customers and enhanced product”, it said in its H1 earnings report.  

UK still makes up majority of Evoke’s revenue  

In terms of revenue split, online revenue was up 6% on 2023 to £1.2 billion, with the UK accounting for 55.2% of the total, versus the international business at 44.5%. 

Further breaking down these figures, UK online revenue increased 9% during the 12-month period while international revenue was up 7%, but this was offset by a continued decline in UK retail (-5%).

This stagnant performance is being addressed, the operator said, as an entire fleet of new betting machines was rolled out between October 2024 and March.  

On the company’s earnings call this morning, one analyst asked whether favourable sports results had helped boost revenue and profit growth in H2. Group CFO Sean Wilkins said while there had been “good sporting results” in Q4, this only offset negative results in the previous quarter.  

Wilkins said “pretty dreadful results had quite a fundamental impact on the business”, but that results on the whole throughout the year had been largely neutral.  

Total cost savings for the year came in at £48 million, and this was attributed to “a simplified operating model focused on customer experience, redesigned product and technology function, releasing more products quicker, increased AI and automation, and efficiency through the supply chain”.  

‘Higher-quality’ revenue mix as customer value grows  

One analyst noted the William Hill operator’s reporting of declining betting stakes and increasing sportsbook margin in 2024. Widerström assured this was due to a shift in customer mix which had seen higher-value players increase, meaning fewer bets but more revenue per customer.  

“We have a fundamental shift when it comes to the customer mix, so we go for core, high value over volume. The customer mix is more sustainable than before and that will of course have an impact on the stakes,” he said.  

This is down to improved personalisation in betting promotions and the new bet builder offering across its William Hill product, he added. 

Evoke plc turnaround driven by sustainable growth

Widerström said the company was primed for “sustainable profitable growth” going forward, thanks to a higher quality revenue mix. Regulated revenue accounted for 95% of total revenue in 2024, up from 94% the previous year and 90% the year before that.  

This, Evoke plc said, was due to its continued focus on its core markets, including the UK, Italy, Spain and Denmark. It also added Romania to this mix in 2024 through the acquisition of local brand Winner.ro in August.  

The group said it has significantly lower exposure to dotcom markets (~4% vs ~13% in 2021) as its customer base, in the UK specifically, is becoming more sustainable and “well positioned for upcoming regulatory change”, the company said.  

Responding to analyst questions on how Evoke had regained some market share in the UK, Widerström highlighted some of the core product changes made during the year, including new landing pages for racing and football betting.

He said the customer feedback on this has been extremely positive and additional updates were in the pipeline for 2025.  

Evoke plc’s new Romanian business was said to have a market share of 7%, including its 888 casino product. Its William Hill Online brand in the UK is reported to have a 9% share of the market, while its retail offering has a 22% market share.   

Gross profit remains flat 

Taking a look at the bottom line, gross profit for the period was largely flat (+1.6%) at £1.15 billion. Evoke reported an operating loss of £200,000, compared to a profit of £24.2 million last year.  

In terms of outgoings, capex for the year was around £100 million to £110 million. The company recorded an exceptional one-off payment of £20 million relating to its US exit, while another £10 million payment was attributed to its Winner acquisition.  

The operator said cash outflow was driven by exceptional costs as it executed the turnaround and transformation of the business. Net debt increased by 0.5% year-on-year by the end of 2024. 

But as the bill has moved through the house and progressed in the senate, what is unique is that much of the opposition has come from government agencies ranging from the attorney general and local police to the departments of taxation and finance. In addition, the department of commerce and consumer protection – which was initially named in the bill as the regulator – opposes the bill.

Support from the industry, meanwhile, has been tangible as well as vocal. Donations made to lawmakers reviewed by iGB reveal that some lawmakers who received donations from the Sports Betting Alliance (SBA) – which prior to 2024 had not made a donation to any Hawaii lawmaker – sponsored gambling bills this session. And in some cases, those legislators have aggressively moved HB 1308 forward.

In addition, Governor Josh Green received two donations from Boyd Gaming, which offers package deals for travel from Hawaii to its Las Vegas properties. Boyd Gaming testified against Hawaii gambling expansion for the first time this year. The company opposes two digital betting bills, but supports a gambling study proposal.

According to the State of Hawaii Campaign Spending Commission, the “candidate named committees” of six Hawaii legislators received $1,000 contributions from the SBA between 17-20 December 2024. BetMGM, DraftKings, Fanatics Betting & Gaming and FanDuel are SBA members.

On the list of recipients are two committee chairs – Lynn DeCoite, chair of the senate economic development and tourism committee, and Jarrett Keohokalole, chair of the senate commerce and consumer protection committee. HB 1308 moved out of a joint meeting of the two committees, with DeCoite and Keohokaloe both voting in favor.

The committees moved the bills unanimously, but four of the 10 votes were “with reservations”, meaning the lawmakers were on the fence about approval.

Four others received donations

Other donation recipients among lawmakers were:

– Representative Daniel Holt, co-sponsor of HB 1309, who is on the finance, tourism and economic development & technology committees.

– Senator Dru Kanuha, sponsor of SB 893, which called for land-based casinos, who sits on the ways and means committee.

– Senator Christopher Todd, co-sponsor of HB 1308, who is on the tourism and economic development & technology committees.

– senate president Ron Kouchi.

DeCoite sponsored a bill similar to HB 1308 in the senate, which passed out of her committee. The bill was ultimately deferred by a joint meeting of the commerce and consumer protection and ways and means committees. DeCoite also supported SB 893, but the same joint committee ultimately agreed to defer that bill.

During the hearing to defer SB 893, DeCoite seemed to speak against a gambling expansion, although she voted for it.

“Casino gambling has not always been a favorite subject,” DeCoite said. “Regardless of if we are flying to Vegas or flying to any other place, we’ve always had our challenges here in Hawaii.”

The next stop for HB 1308 is the ways and means committee. DeCoite and Kanuha are on that committee.

Boyd Gaming donates at interesting time

Also among the donations were two from Boyd Gaming to Green, the governor, for $2,546 and $3,000 on 11 October. There was also one for $2,700 made by Boyd Gaming to Kauai mayor Derek Kawakami on 3 September 2024.

The donations to Green were made in the middle of a trip to Las Vegas to “learn about sports tourism”, per a press release from his office. During that trip, Green attended a Las Vegas Raiders game with Boyd Gaming executives on 13 October, according to a source. Boyd Gaming properties – there are 10 of them in the Las Vegas area – are marketed as the “official and exclusive” local casinos for the Raiders.

Green’s 10-15 October visit to Las Vegas was related to the gambling mecca’s rise as a sports destination. He has been vocal about supporting a new multi-use stadium in Hawaii, but his position on gambling expansion is unclear.

With regard to legal sports betting, Green told Hawaii News Now in January that he “supports careful exploration of sports wagering in Hawaii, provided that proper safeguards are in place to prevent abuses”.

As to sports betting, the most recent gambling hearings and votes were on 19 March and 21 March when the house tourism and economic development committees moved SB 891 forward. The bill would create a working group to study past proposals to legalise gambling. The goal would be to determine “if any have the potential to to be implemented by the state”.

The measure also calls for study of a potential gambling framework and the feasibility of “gaming activities at the New Aloha Stadium Entertainment District”. The bill is still in committee and no studies have been completed.

Discussion around study bill raises questions

During the 19 March hearing, there was much discussion about who should have a seat on a study committee. In the original text, lawmakers wrote that representatives from BetMGM, Boyd Gaming and DraftKings would have seats at the table. BetMGM and DraftKings are SBA members and their representatives have been consistently testifying at gambling hearings in Hawaii. Boyd has also testified at multiple gambling hearings.