Question of the Day - 02 July 2025

Yesterday, we answered the first part of this QoD submission: How does the cryptocurrency gambling market work? Today, we answer the more technical questions. 

For Part 2, we turned to our colleague across the pond, Hannah Gannagé-Stewart, a freelance journalist based in London who specializes in igaming, gambling regulation, and cryptocurrency -- in other words, perfect for this answer, as you'll see.

Rather than a gray or black, Hannah accurately calls crypto gambling "a shadow market."

Hannah writes, "A recent Financial Times article cited Yield Sec figures revealing that wagering via cryptocurrency has seen a fivefold increase since 2022, generating $81.4 billion (£61 billion) in gross gaming revenue (GGR) last year. By contrast, global online GGR from traditionally licensed online casinos is estimated to have been somewhere between $78.7 billion and $95.5 billion last year, with Europe contributing around 40% of the global total at €47.9 billion."

So that's how big the crypto gambling market is: as big or even bigger than all licensed and regulated online casinos worldwide. 

Hannah continues, "This may or may not come as a surprise. Crypto isn't new and its suitability for applications to the gambling industry was evident from the outset. Yet this shadow market seems to have been allowed to blossom relatively unchecked.  

"The lack of regulation in this area is, of course, a massive factor in its explosive growth trajectory. That, coupled with its anonymity and ease of use across borders, make it super appealing to a vast swath of gamblers. For some, its ongoing reputation as a somewhat illicit shadow economy is no doubt also a draw.  

"On the other hand, influential individuals, such as President Donald Trump and Elon Musk, openly advocating for crypto – whether their own or more established currencies – have added a level of credibility among crypto enthusiasts that may have been lost briefly during the high-profile crashes of crypto exchanges such as FTX, BlockFi, and Genesis Global Capital in late 2022."  

As evidence, note that Bitcoin has hovered around $100,000 recently, significantly higher than the $68,789 peak it hit on November 10, 2021, around a year before the FTX crash led it to plummet to $15,900. Since then, it has seen an astonishing resurgence, hitting a new peak of $109,026 on January 20. Today, it's around $105,000. So it's clear that, unlike some pundits have claimed, cryptocurrencies are anything but a fad, nor as Hannah writes, "has it failed due to lack of utility or even after a few bad actors brought the house of cards tumbling down in 2022."

As for implementing regulation, that's a thornier thicket, with equally vociferous opinions on both sides of the issue. According to Hannah, however, this is more of a "technology gap than a gap of wills." 

One of the problems is that, especially in Europe where regulation is more stringent, "No operator has been able to demonstrate compliance with the regulator’s anti-money laundering (AML) and know-your-customer (KYC) obligations," Hannah says. That's where the tech gap comes into play; a vast amount of data monitoring is required for casinos to sufficiently meet the AML and KYC requirements of existing regulations.

On the other hand, "Crypto advocates would argue that all the information is there on the blockchain and that there's actually greater transparency in crypto than in fiat-currency transactions." In other words, cash transactions are harder to track than cryptocurrencies. On the other other hand, the capacity to access and use all that data is another matter entirely.  

Hannah concludes, "For unregulated casinos, that’s not an issue and for now, they’ll continue to multiply in the shadows. But for those that want to operate inside the world’s biggest regulated markets, finding a way to harness blockchain data and use it to reassure regulators may be the only way to bring these two parallel markets together."