UK Black Market Wagers Hit Almost £17 Billion

 ^{Illegal offshore gambling sites siphoned almost £17 billion away from UKGC-licensed operators in 2025, according to new research. (Image: Pexels)}

The latest research by H2 Gambling Capital (H2GC) shows that the threat of unlicensed offshore gambling sites is growing in the UK. Tracking the prevalence of unregulated casino, poker and sports betting activity, analysts at H2GC found that spending has increased from £5 billion to £16.6 billion over the last six years. Although previous figures published by H2GC have been described as “overblown” by the UK Gambling Commission (UKGC) and academics, such as Heather Wardle, all experts agree that the issue is getting worse.

The money being wagered by British gamblers at offshore sites is not only concerning from a safety perspective. As noted in the report published on May 8, 2026, the share of gambling happening legally in the UK has fallen from 97% in 2019 to 92% in 2025. That means an extra 5% of British gamblers are choosing to use potentially unsafe sites that don’t comply with UK Gambling Commission (UKGC) standards.

Grainne Hurst, Chief Executive of the Betting and Gaming Council (BGC), has described the trend as a threat to consumers and the British gambling industry.

“What we are seeing is a harmful black market scaling up at pace. Illegal operators are becoming more sophisticated, more visible and more aggressive. That should concern anyone who cares about consumer protection”, Hurst said in a press statement.

Regulation squeezes licensed gambling operators

A factor influencing the migration of British gamblers to offshore sites is regulation. Specifically, higher taxes and intrusive financial checks are increasing costs and making UKGC-licensed online casinos less competitive.

Online gamblers have long valued three things: added value, easy payments and choice. With offshore regulators unencumbered, they’re free to promise massive welcome bonuses, anonymous crypto payments and the same betting options as their licensed counterparts.

The problem, however, is that these services aren’t regulated in the UK. This leaves customers exposed to risks, including data leaks, security issues and the possibility that bonuses or withdrawals won’t be honoured. Gambling sites licensed by the UKGC won’t do these things, and if they do, there are consequences such as fines. Offshore gambling sites aren’t subject to disciplinary action, which, essentially, leaves them free to do as they please.

UK Gambling Commission fighting back

For its part, the UKGC is stepping up efforts to tackle illegal online casinos and sportsbooks. Casinos.com contacted the regulator about the problem. A UKGC spokesperson reconfirmed recent measures taken by the UKGC, including the removal of 266,667 URLs connected to offshore gambling sites. They also told us that the UKGC is working with other organisations to stem the flow of money going offshore.

“We are also working with domain registrars, hosting providers, social media platforms and international partners to suspend domains, disrupt payment flows, tackle aggressive marketing and prevent illegal sites from being accessed from Great Britain”, said the spokesperson.

What’s driving the move to illegal gambling sites?

Analysts at H2GC, as well as watchdogs at the BGC, point to aggressive marketing tactics as a reason why consumers are choosing illegal gambling sites. Citing data published by WARC, Chief Executive of the BGC, Hurst, said that almost half of all UK gambling advertising spend now comes from unlicensed operators. 

Forecasts by analysts at WARC, a marketing intelligence firm, show that advertising spending by licensed operators is set to fall by 9.2% in 2026. Meanwhile, it’s expected that unlicensed operators will up their spending by approximately 32%.

The reduction in advertising budgets among UKGC-licensed operators is due to increased costs caused by the increase in Remote Gaming Duty (RGD). One of the UK’s largest operators, Flutter Entertainment, published its Q1 financials last week. Despite increased revenue across its global network of gambling sites, CEO Peter Jackson said that headwinds from RGD rising to 40% require “first-order mitigation” tactics, such as reducing the company’s UK “marketing” budget.

The crypto conundrum

The other, often overlooked, reason for the growth of offshore gambling sites over the last six years is cryptocurrency payments. These sites allow players to make anonymous deposits and withdrawals in a variety of cryptocurrencies, including Bitcoin (BTC) and Tether (USDT). 

The decentralised nature of these tokens means that anyone, anywhere, can use them. This has made payments to offshore crypto sites possible, which, in turn, has opened up the black market to players around the world, including the UK. 

Although regulations have made the UK a standard-bearer for safety and security, they have reduced the margins for operators. This has made them less competitive when it comes to betting and casino promotions. When you combine these forces with aggressive marketing and the allure of anonymous crypto payments, it’s clear to see what’s contributing to the growth of illegal gambling sites in the UK.