Germany’s GGL has released a comprehensive survey reviewing black market activity. The 132-page report estimates that estimated gross gaming revenue (GGR) reached €547 million in 2024, up 17% from an estimated €466 million in 2023.
Additionally it determined a channelisation rate of 77.03% in the market, suggesting that legal or regulated offerings account for more than three-quarters of the online gambling market.
“The scientifically calculated channeling rate confirms our previous assumptions about the size of the black market ,” Ronald Benter, CEO of GGL, said of the rate. “The results support the fact-based regulatory approach within the framework of the 2021 Interstate Treaty on Gambling.”
Study parameters
Commissioned by the joint gambling regulator of Germany’s federal states (GGL), the Blockchain Research Lab conducted a comprehensive two-part investigation into Germany’s unlicensed online market.
The study encompassed a review and assessment of existing methodologies for measuring the size of the black market. It has been broadly flagged by regulators that assessments of this nature vary broadly due to the various methodologies available. In this case the study encompassed a collection of original behavioural data collected via a panel survey involving 2,000 individuals who had engaged in online gambling (excluding lotteries) within the previous 12 months.
Respondents named up to seven gambling platforms they frequented and reported average stakes and losses per session and per month across each. Researchers categorised operators as licensed or unlicensed based on the GGL’s whitelist and other sources, with data cleaning and imputation applied where necessary. Using respondents’ reported spending, licensed-market revenue figures were compared to assess the size of the unlicensed segment.
The study also examined common approaches to measuring illicit online gambling markets. This included traffic-based “reference value” methods, behavioural tracking panels, proxy measures (such as tax data or legal enforcement) and player surveys. It noted that each carries inherent strengths and weaknesses.
Licensed and unlicensed platforms at play
The survey recorded 4,027 mentions of gambling operators. Of these, 79.7% were for licensed operators while 20.3% pertained to unlicensed gambling platforms.
Non-licensed platforms accounted for approximately 22.4% of total stakes and 22.97% of player losses in the survey data. Those using solely unlicensed platforms reported higher average monthly stakes (€1,425) and higher losses (€475) compared to exclusive users of licensed operators, who reported €1,243 in stakes and €358 in losses.
“The average stakes per gaming session differ slightly between the groups, but are not statistically significant,” said the report. Individuals who claimed to play exclusively on unlicensed sites staked an average of €88.96 per session. This was compared to users of exclusively licensed providers betting an average of €77.00.
Licensed market mentions predominantly included well-known sports-betting brands such as Tipico, Bwin, Bet-at-home and Betano. Conversely, the unlicensed market survey flagged brands including Stake.com, WooCasino and PlatinCasino.
The publication of the study comes after a national gambling survey found that 36.4% of recipients reported gambling in the last year.
A need to track the market
The report encouraged repeated, standardised surveys alongside technical monitoring tools. This includes machine learning-based detection of illicit platforms, transaction monitoring and blockchain analytics for crypto-enabled gambling.
The authors recommended utilising emerging technical tools such as machine-learning classifiers for gambling websites, web crawling, payment flow analysis and blockchain monitoring as promising supplements for identifying unlicensed operators and opaque payment channels.
The authors and the GGL said they regarded these figures as indicative rather than definitive and urged the implementation of repeated surveys and mixed-method monitoring frameworks to refine future assessments and enforcement strategies.
Original article: https://igamingbusiness.com/legal-compliance/regulation/germanys-unlicensed-online-gambling-market-466-million-2023/
