Crypto casinos surge as gamblers bypass bans using offshore sites – report

Crypto casinos are reportedly pulling in tens of billions of dollars every year. According to new data, many gamblers are dodging restrictions in their own countries and placing bets on unregulated offshore sites instead.

The Financial Times reports that even though crypto gambling is illegal in most places, bets made with digital currencies brought in $81.4 billion in gross gaming revenue last year. That’s the amount left after paying out winnings, and it’s five times more than what was made in 2022, based on research from online crime watchdog Yield Sec.

Even though crypto gambling sites are officially blocked in places like the US, China, the EU, and the UK, people are still getting around those restrictions. All it takes is a VPN, a mirror link, or a bit of URL redirection, and they’re in.

Hundreds of ‘ready-to-gamble' crypto casino accounts are being openly sold on Facebook and other mainstream social media sites – I found most sellers were flogging @Stake's profiles. It shows, once again, how simple it is to get around the safety barriers. https://t.co/heyckYAMCH

— sanya burgess (@sanyaburgess) January 31, 2024

Some of these crypto casinos are based in places where this kind of gambling is legal, like Curaçao, Malta, the Isle of Man, and Gibraltar. Big names like Stake, Rollbit, and Roobet operate out of these jurisdictions, and they’ve grown so fast they’re now competing with the biggest players in the traditional gambling world.

Stake is run by a Curacao-based company called Medium Rare, and they claim their platform handles up to 4% of all Bitcoin transactions worldwide. Since launching in 2017, they’ve reportedly attracted around 25 million users who’ve placed over 300 billion bets. Last year, Stake is said to have brought in $4.7 billion in gross gaming revenue, an 80% jump from the year before.

Major traditional gambling giants like Entain and Flutter brought in $6.6 billion and $14 billion in total revenue last year, respectively. Bet365 pulled in $4.9 billion for the year ending March 2024. However, those companies don’t break out gross gaming revenue numbers like Stake does.

According to a written testimony supplied to a UK Parliamentary Select Committee, Yield Sec CEO Ismail Vali said that there was a “misconception” that allowed illegal operators to “thrive around legal video gaming, social media and digital currency platforms, exploiting products like loot crates, mystery boxes, and predictor games.”

He continued: “These ‘platform parasites’ offer services that often appear as ‘workarounds’ within the legal platform, be it video gaming or cryptocurrency investing. However, the reality is that they utilize age-old gambling mechanics adapted to the nuances of mass audience platforms.”

The Financial Times also notes that Stake doesn’t see itself as a “crypto casino.” The company says more than half of the transactions on its platform are made using traditional currencies, not crypto.

Stake is also the main shirt sponsor for Everton Football Club, but it recently shut down its non-crypto UK platform. The platform, run through Isle of Man-based TGP Europe, was pulled after the UK Gambling Commission launched an investigation into a promo video that featured an adult performer.

Consumers are being advised that 'stake. uk. com' will no longer be a licensed website from next month.

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