Does anyone really know how big the gambling black market is?

By: Paul Skidmore
Industry

Does anyone really know how big the gambling black market is? Pexels CC0

Key Takeaways

  • VPN use is making illegal gambling activity harder to track.
  • Experts disagree on whether VPNs are a genuine threat or a distraction.
  • Regulators face growing challenges measuring activity in a borderless online world.

The size of the gambling black market has become one of the industry's most hotly debated issues. Regulators, operators and trade bodies frequently warn that consumers are increasingly turning to unlicensed websites that offer none of the safeguards found in regulated markets.

But how accurate are the figures being used to measure it?

The issue is confused by the use of virtual private networks (VPNs). VPNs are entirely legal and widely used for privacy and cybersecurity purposes. However, they can also hide online activity from traditional tracking methods. This makes it harder for regulators to understand what consumers are actually doing online.

Recent comments from the UK Gambling Commission suggest this is becoming a significant challenge.

Why measuring illegal gambling is so difficult

Unlike the regulated sector, illegal gambling operators do not publish customer numbers. We don’t know their betting volumes or revenue data either. This means regulators must rely on a combination of web traffic estimates, consumer surveys, industry intelligence and trend analysis to understand the scale of the market.

The Gambling Commission has repeatedly acknowledged that no single dataset can provide a complete picture of illegal gambling activity. Instead, estimates are built using multiple sources and assumptions. There’s an inevitable degree of uncertainty.

The growing impact of VPNs

VPNs have become increasingly popular in recent years. This is particularly true following the introduction of the UK's Online Safety Act and its age-verification requirements.

The Gambling Commission recently revealed that it had already incorporated a 30% VPN adjustment into its methodology for tracking illegal gambling activity. However, as VPN adoption increased after July 2025, the regulator revised its assumptions using additional data from Ofcom and Similarweb. The result was not greater certainty, but greater uncertainty about the true scale of illegal gambling engagement.

Experts are divided

Not everyone agrees on the significance of the VPN issue.

Some industry specialists see growing VPN use as evidence that existing enforcement systems need to change. Mike Venner, director at Advanced Compliance Technology, argues that traditional geolocation checks are no longer enough. This is because location-spoofing tools are widely available. He believes regulators and operators should adopt more advanced systems that combine location, device, identity and behavioural data.

Others are more confident that technology can keep pace.

Elizabeth Cronan, vice president of government affairs at GeoComply, says regulated markets already have access to sophisticated geolocation systems capable of detecting VPNs, proxies and other location-manipulation tools. According to Cronan, the larger problem is often that illegal operators simply choose not to implement these protections.

Is the VPN debate distracting from the real issue?

Ismail Vali, president of Gaming Compliance International, is one of the most sceptical. He argues that VPNs are a convenient explanation for a much larger problem. In his view, VPN users only make up a small proportion of the audience accessing unlicensed gambling websites. Most consumers can reach offshore operators without needing a VPN at all.

Vali also mentions the practical drawbacks of VPN use in gambling environments. Delays, interrupted connections and additional friction can negatively affect experiences such as live betting, poker and live dealer games. This reduces their appeal.

From this perspective, the continued availability of offshore operators may be a more important concern than the tools some consumers use to access them.

Why the numbers matter

The debate is not simply academic. Black-market estimates increasingly influence discussions around gambling policy, consumer protection measures and regulatory reform. Industry groups frequently cite concerns about:

  • Illegal gambling when responding to proposals involving affordability checks.
  • Taxation changes.
  • Stricter compliance requirements.

If measuring illegal gambling becomes more difficult, policymakers may find it harder to assess whether interventions are achieving their intended outcomes or producing unintended consequences.

The challenge is compounded by the fact that online activity is becoming more private. It’s also more difficult to track across many sectors, not just gambling.

The challenge

VPNs are unlikely to disappear. They are legitimate tools used by millions of consumers for privacy, security and online freedom.

What the current debate highlights is that measuring illegal gambling may be becoming just as difficult as combating it. That leaves an uncomfortable reality.

 

Paul Skidmore is a content writer specializing in online casinos and sports betting, currently writing for Casino.com. With 7+ years of experience in the iGaming industry, I create expert content on real money casinos, bonuses, and game guides. My background also includes writing across travel, business, tech, and sports, giving me a broad perspective that helps explain complex topics in a clear and engaging way.

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