U.S. Crypto Casinos Generate $67.1 Billion in Illegal Gambling Revenue in 2024

A growing but largely unregulated segment of America’s gambling industry—crypto casinos—is rapidly outpacing legal operators, according to controversial research from Yield Sec, a firm that claims to use advanced monitoring tools to track online gambling activity. The study, commissioned by The Campaign for Fairer Gambling, estimates that the U.S. online gambling market generated $90.1 billion in gross gaming revenue in 2024, with $67.1 billion—nearly 74%—flowing through illegal channels, a 64% year-over-year increase compared to 36% growth for legal operators [1].

This “shadow gambling” industry, fueled by the anonymity and cross-border flexibility of cryptocurrency, has created an environment where criminal networks exploit regulatory gaps with increasing precision. When states like New York restrict gambling to sports betting, offshore operators immediately pivot to casino-style games and prediction markets. Similarly, when jurisdictions impose age limits, illegal sites target underage users [1].

Ismael Vali, founder of Yield Sec, argues that most industry analysts are misinterpreting the data. Traditional market research firms report a $90 billion global gambling market, but these figures, he claims, only reflect the regulated portion of a much larger ecosystem [1]. Using a methodology he calls “value per visit,” Yield Sec estimates gambling revenue based on user behavior, including time spent on gambling sites and registration patterns. This method, Vali says, has proven highly accurate in predicting betting volumes for major sporting events, and he maintains that it can be applied equally well to unregulated markets [1].

Crypto casinos have become particularly effective at leveraging these regulatory loopholes. Unlike traditional gambling platforms, they offer pseudonymous transactions and are often based in jurisdictions with lax oversight, such as Curaçao or Malta [1]. Stake.com, one of the largest crypto gambling platforms, reportedly generated $4.7 billion in gross gaming revenue in 2024, with 25 million users placing 300 billion bets since 2017. The company is said to account for 4% of all global bitcoin transactions [1].

However, the industry’s expansion has raised serious ethical concerns. Crypto casinos typically require higher minimum deposits than legal operators, targeting high-stakes gamblers rather than casual players. They also offer extreme betting options, from celebrity death pools to territorial war bets, often designed to drive user engagement and funnel traffic to more profitable casino games [1]. According to Yield Sec’s research, some crypto gambling platforms have even targeted vulnerable populations, such as those receiving public benefits in countries like Brazil, where 25% of social welfare funds reportedly flowed into gambling sites during a crisis [1].

The adaptability of crypto gambling became especially evident during the pandemic. When traditional sports betting dried up, illegal operators created their own content, including amateur basketball matches, table tennis games, and even snail racing, to keep users engaged [1]. This level of innovation has allowed them to maintain steady user growth despite the lack of official licensing or consumer protections.

Critics of Yield Sec’s findings argue that the firm’s numbers are inflated. Tanzanite, a competitor in the gambling analytics space, estimates that crypto gambling represents only $10–$11 billion globally, relying on blockchain data and self-reported figures from major operators for its calculations [1]. Vali counters that criminal enterprises are unlikely to report revenues accurately, and he suggests that his firm’s behavioral analytics offer a more reliable gauge of market activity.

The traditional gambling industry is struggling to keep up. Legal operators such as Flutter and DraftKings have captured over 80% of the U.S. sports betting market but have yet to achieve consistent profitability. The entire American online gaming industry has produced only one profitable quarter in seven years of operation [1]. Meanwhile, crypto casinos, which operate with minimal compliance costs and fewer customer protection requirements, continue to outpace them.

The regulatory landscape is also in flux. In the U.S., some states are beginning to take action against crypto gambling operators, challenging the legality of platforms that claim federal derivatives regulation supersedes state laws. In the UK, the Gambling Commission has issued 287 cease-and-desist notices to crypto gambling operators since April 2024 [1].

Vali argues that the solution lies not in more regulation but in better enforcement of existing laws. He claims that the technology exists to track illegal gambling operators in real time, but what’s missing is the political will to deploy it on a large scale [1]. Without decisive action, the shadow gambling empire may soon surpass its legal counterpart entirely, reshaping the future of online gambling in America.

Source: [1] How Crypto Boosts America’s $67 Billion Shadow Gambling Industry (https://www.forbes.com/sites/boazsobrado/2025/08/01/how-crypto-boosts-americas-67-billion-shadow-gambling-industry/)