Crypto Casinos Target Self-Excluded Gamblers in the UK

Rise of Illegal Crypto Casinos Targeting Vulnerable Gamblers

The Betting and Gaming Council (BGC) has raised alarms about a growing number of illegal online gambling sites using cryptocurrencies to evade regulatory oversight in the United Kingdom. These illicit platforms are reportedly aiming to attract vulnerable individuals, particularly those who have self-excluded from legal gambling options.

Impact of Prospective Tax Increases on Illegal Gambling

A recent survey highlights the potential consequences of proposed gambling tax hikes, suggesting that roughly 28% of regular gamblers might turn to illegal operators should the increase be implemented. Grainne Hurst, CEO of the BGC, emphasized the risks, warning that overly stringent tax and regulatory policies could inadvertently strengthen the black market, which operates without paying taxes, lacks contributions to British sports, and provides no safeguards for responsible gambling.

Even without the tax hike, issues persist. The same survey revealed that 14% of participants already engage with illegal operators, while 29% of gamblers are unable to distinguish between regulated and unregulated gambling websites.

Alarming Levels of Illegal Gambling Among Self-Excluded Players

Further concerns arise from a study by Yield Sec, indicating that illegal gambling in the UK amounts to approximately £583 million. A significant portion of this illicit activity stems from individuals who have enrolled in GAMSTOP, the official self-exclusion program for UK gamblers.

Affiliate marketing firms exacerbate the issue by promoting services that are “not on GAMSTOP,” deliberately targeting self-excluded players. This strategically harms vulnerable individuals and feeds the illegal market, a problem that may worsen if the tax is increased.

Ismail Vali, founder of Yield Sec, asserts that the illegal gambling market’s share of the UK industry has surged from 0.43% in 2020 to about 9%, largely due to targeted marketing that exploits the “not on GAMSTOP” keyword, drawing in those who should be protected by self-exclusion.

Offshore Operators Exploit Self-Exclusion to Fund Illegal Gambling

Vali explains that illegal gambling operators primarily target two groups: underage individuals and those registered with the GAMSTOP self-exclusion program. He notes that illegal operators avoid legal compliance due to the high costs and complexities associated with operating legitimately within the UK.

Derek Webb, founder of Campaign for Fairer Gambling, stresses that while regulators focus on overseeing the licensed market, illegal operators thrive by specifically targeting self-excluded gamblers through unregulated platforms advertised as “casinos not on GAMSTOP.”