Despite growing efforts to regulate online gambling in the United States, a new study suggests that illegal gambling still dominates the market, accounting for an estimated 74% of all online activity. The findings come from Yield Sec, a data intelligence firm specializing in tracking unregulated digital markets, and are supported by The Campaign for Fairer Gambling.
Illegal Online Gambling Surges Across the U.S.
Yield Sec’s analysis of the U.S. iGaming landscape reveals that unauthorized online casinos, sports betting platforms, and crypto gambling sites continue to thrive, even in states with legal frameworks. Founder Ismail Vali warns that regulation alone is not enough to eliminate criminal activity, stating:
“Just because you’ve regulated a market doesn’t mean crime disappears.”
Vali estimates that 70% of all gambling activity in the U.S. still flows through illegal channels, with cryptocurrency casinos playing a major role in exploiting regulatory loopholes. Yield Sec claims to have identified tens of thousands of crypto gambling sites operating globally, many of which target U.S. consumers.
State-by-State Breakdown of Illegal Gambling
Yield Sec’s research includes a state-level analysis of black market activity:
- California: $5.5 billion in illegal gambling volume
- Texas: $4.5 billion in illegal gambling volume
- Ohio: Only 15% of its $6.2 billion gambling market is legal, with over 917 unlicensed operators detected
These figures highlight the scale of unregulated gambling, even in states with active oversight.
Tracking Illicit Gambling with Counter-Terrorism Tools
Yield Sec’s methodology is rooted in counter-terrorism intelligence, originally developed to monitor threats like ISIS. The firm has adapted these tools to track gambling activity during major events such as the Super Bowl and March Madness, claiming high accuracy in estimating illegal volumes.
However, the report has raised questions among industry observers. While Yield Sec paints a grim picture of the U.S. gambling landscape, mainstream research firms have yet to corroborate these numbers, prompting debate over the true scale of the problem.
Key Takeaways
- 74% of U.S. online gambling may be illegal, according to Yield Sec
- Crypto casinos are a growing threat to regulated markets
- California, Texas, and Ohio are major contributors to the black market
- Regulation alone is not enough to eliminate illegal gambling activity
- Yield Sec uses counter-terrorism tracking methods to monitor illicit gambling flows
As the U.S. online gambling industry continues to expand, this report underscores the urgent need for stronger enforcement, better consumer education, and more robust oversight to combat the rise of illegal operators.
