Brazil’s betting industry shows growth, but there is an elephant in the room
Brazil’s newly regulated sports betting market delivered record profits in its first full year of legal operation in 2025, but authorities and industry experts warn that a sizeable chunk of wagering activity continues to flow through unlicensed, offshore channels.
According to data released by Brazil’s Secretariat of Prizes and Bets (SPA), licensed online betting operators generated BRL 37 billion (about US$7 billion) in gross gaming revenue (GGR) during 2025, the first year after the regulated market launched on January 1, 2025.
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Licensed operators also contributed roughly BRL 2.5 billion in licence fees and the federal tax authority reported nearly BRL 10 billion in tax receipts from the sector — underscoring its rapid growth and fiscal impact.
SPA officials said the data provides a firmer picture of the emerging sector and will inform future policy decisions on consumer protection and compliance.
The gambling regulator also highlighted efforts to curb unregulated activity, including the blocking of more than 25,000 illegal websites in coordination with the national telecommunications agency.
Despite those gains, industry analysis shows that the legal market does not yet encompass all gambling traffic and spending. A study presented at the ICE Barcelona conference in January 2026 estimated that roughly 30 per cent of gross gaming revenue in Brazil’s online gambling ecosystem occurs outside the regulated framework, on unlicensed or offshore gambling sites. That translates into about BRL 15 billion in annual revenue that does not pass through Brazil’s licensing or tax system.
The persistence of unregulated betting reflects ongoing challenges in enforcement and public awareness. Surveys indicate that around 30 per cent of Brazilian bettors struggle to identify whether a platform is licensed, and about 20 per cent prioritise bonus offers over regulatory status when choosing where to wager. Only a small minority — roughly 3 per cent — explicitly prefer unlicensed operators, suggesting that lack of information and marketing incentives are key drivers of offshore play.
Market participants and regulators say bolstering consumer education and tightening financial monitoring will be critical to drawing more activity into the legal market and maximising tax revenue. For now, Brazil’s sports betting sector stands as one of Latin America’s fastest-growing regulated industries, even as offshore gambling continues to siphon significant revenue that might otherwise bolster state coffers.
