Nearly two-thirds of 2024’s gross gaming revenue came from unlicensed sportsbooks and casinos.
According to a Bloomberg report, Yield Sec research found illegal, unregulated operators accounted for $67.1 billion, or 74%, of the $90.1 billion of profits produced last year.
Key takeaways
- Bloomberg report says illegal gambling revenue reached $67.1 billion, up 64% from the previous year.
- Americans still use offshore and unregulated operators for novelty bets they can’t make at licensed sportsbooks.
- States are cracking down on forms of illegal gaming, but an advocacy group is calling for federal involvement.
“38 states have legalized sports betting and seven have online casinos, but illegal gambling operators have all those products in all the states all the time,” Yield Sec founder Ismail Vali told Bloomberg. “Illegal gambling wins.”
The amount of revenue from unregulated gaming increased 64% year-over-year, according to research the Campaign for Fairer Gambling, a bipartisan gaming advocacy reform group, commissioned.
Illegal gaming flourishes
Despite the rise of legal sports betting and online casinos since the U.S. Supreme Court overturned PASPA in 2018, offshore sportsbooks and casinos continue to flourish. Sweepstakes casinos, which use virtual currency to fund accounts, have also grown throughout the U.S., especially in states without any legalized gambling.
California, which doesn’t have regulated sports betting or online casinos, generated $5.9 billion in illegal gambling in 2024, Yield Sac said. New Jersey, which does offer both legal sports betting and iGaming, produced over $6 billion in GGR. Research showed 40% came from illegal operators.
Yield Sac also found the Super Bowl and March Madness were catalysts for wagering at offshore and unregulated sites. Many of these offer novelty props markets on those huge sporting events that aren’t available at legal American books.
Cracking down
The American Gaming Association reported in February that legal gaming industry revenue reached an all-time high of $77 billion in 2024. iGaming accounted for $8.4 billion despite its limited availability nationally. Americans wagered $150 billion at legal sportsbooks, the most ever recorded. Profits rose 23.1% to $13.71 billion.
The Campaign for Fairer Gambling advocates keeping gaming revenue in the U.S. and called for the federal government to stop offshore operators. The group also wants federal regulation for sports betting and prediction markets, which came under fire this year.
A handful of regulators in legal gaming states, including Nevada, New Jersey, and Maryland, sent cease-and-desist letters to Kalshi, a prominent prediction platform that offers sports-event outcome markets in all 50 states.
Lawmakers in New Jersey, New York, and Pennsylvania, among others, are actively trying to make sweepstakes casinos illegal. Michigan sent multiple sweepstakes companies cease-and-desist orders. Those virtual currency operators let users purchase free coins and exchange them for cash and prizes, violating some states’ gaming laws while also going unregulated and untaxed.
