A recent report commissioned by Euromat and compiled by Regulus Partners and Helios estimates that the black market in Europe has experienced an annual growth rate of 18% from 2019 to 2026 and could reach a value of as much as €13 billion by the end of 2023.
This comprehensive analysis covers black market activities across 28 jurisdictions, including the United Kingdom, the Netherlands, and Germany. The report reveals that around 25 operators dominate this space, managing approximately 64% of the total black market traffic.
The rapid rise of cryptocurrencies and effective marketing strategies have enabled these operators to capture a significant share of the illegal gambling market. The authors of the report identified that some brands specifically target banned products in regions where they are not legally permitted, such as the case in France, where licensed operators cannot legally offer iGaming.
The report highlights that the largest black market operators have built strong, recognizable brands that attract traffic comparable to that of licensed domestic operators. According to the findings, a group of sites operated by common ownership holds a 12% share of traffic, while the largest single brand commands a 10% share.
Moreover, many black market operators offer cryptocurrency payment options and are licensed in jurisdictions with minimal regulation. This makes enforcement against them particularly challenging due to opaque ownership structures. In contrast, smaller black market operators heavily depend on affiliate marketing to drive traffic.
The report attributes much of the growth of the black market to increasingly restrictive policies imposed by regulators on licensed operators. It emphasizes that 46% of the analyzed markets have implemented strict advertising restrictions, which create an environment conducive to illegal activity. Countries such as Belgium, Bulgaria, Croatia, Cyprus, Germany, Italy, Latvia, Lithuania, Montenegro, the Netherlands, Poland, Romania, and Spain are among those with significant advertising limitations.
Additionally, the report notes that taxing consumers—adopted in 29% of the surveyed markets—and banning certain products—present in 14%—are further contributing to the rise of illegal gambling. Monopolistic practices in five markets have also limited consumer choices, pushing players towards black market alternatives.
The report states that when customers encounter restrictions on their preferred betting options, they often seek out black market sites that provide those services, transferring their expenditures there. This situation is particularly critical for highly engaging gaming options, where players dissatisfied with return-to-player (RTP) rates or bonus limitations may gravitate towards unlicensed offerings that have fewer restrictions.
According to Regulus, a notable trend is that the top 1% of users account for nearly half of the black market revenue across Europe, reflecting similar patterns found in the licensed gambling sector where expenditure is concentrated among a small group of players.
The report also details a sharp increase in black market activity within the UK, projecting it could approach €1 billion due to a recent hike in the remote gaming duty from 21% to 40% implemented in April. Regulus expects that as consumers move towards illegal options for unrestricted benefits, this tax increase will drive significant changes in market behavior. Previous studies have found that two-thirds of bettors indicated that this tax hike would lead them to play with unlicensed operators.
Historically, the UK has maintained a high level of channelization, benefiting from a mature market and robust competition, with up to 1,491 licensed sites available for players.
To compile this report, various methodologies were used to estimate the scale of Europe's black market, including analysis of web traffic, digital marketing, and local regulations in the surveyed markets. Helios, specializing in gambling web traffic, evaluated the number of actively marketed black market websites between March and May, cross-referencing this data with SimilarWeb traffic analysis. The findings revealed that the number of illegal sites advertising in countries like France, Portugal, the Netherlands, Germany, Cyprus, Belgium, and Spain often exceeded the number of licensed operators.
