Executive summary
Crypto gambling’s growth has outpaced policy. Some argue for outright bans to prevent harm and money laundering; others say regulation with strong Know-Your-Customer (KYC), advertising limits, and payment transparency better protects the public. The EU’s crypto “Travel Rule” entered application on December 30, 2024 and MiCA’s framework is phasing in, reshaping how EU-facing payment partners move funds. Meanwhile, jurisdictions like Ontario and Brazil restrict crypto deposits entirely for licensed operators—illustrating a “ban-the-rails” approach even within regulated markets.
The case for a ban
Public-health harms are real and rising
Major health bodies frame gambling harm as a public-health issue linked to mental illness, suicidality and family/financial harm. The WHO’s 2024 fact sheet and recent public-health literature highlight the breadth of impacts and the need for systemic responses, not just individual self-control. The UK’s NHS has expanded to 15 specialist gambling clinics to meet demand.
Enforcement simplicity and clear messaging
Where governments choose prohibition or hard blocks, it is easier to send a clear message. Australia’s regulator (ACMA) continuously orders ISPs to block illegal gambling sites and publishes a live list, signaling that offshore crypto gambling is not permitted.
Crypto-specific financial-crime risks
FATF’s June 2025 update warns that stablecoins are increasingly exploited by illicit actors and that only a minority of jurisdictions are largely compliant with its crypto standards. In other words, permitting crypto gambling without fully mature AML controls risks becoming a laundering conduit.
The case for regulation
Channelization: pulling players into safer, licensed sites
“Channelization” measures what share of play occurs on licensed platforms. Ontario reports ~86% of online gamblers use regulated sites; Denmark reports ~91% channelization after liberalization—evidence that clear rules, strong oversight and attractive legal offerings can move consumers out of the black market.
Harm-reduction via targeted rules
The UK is tightening promotions—banning mixed-product bonus offers and capping wagering requirements—changes that aim to reduce harmful incentives and make terms clearer for consumers. Such measures can be copied by crypto-facing brands that hold mainstream licenses.
Payments transparency is getting teeth
Inside the EU, crypto transfers now carry mandated originator/beneficiary data under the Travel Rule, with EBA guidelines applying from December 30, 2024; MiCA adds licensing and conduct rules for crypto-asset service providers. Pair these with the EU’s new AML Authority (AMLA) and you get a progressively tighter compliance net that regulated operators can plug into.
What bans look like in practice
Bans can target the activity or the rails. Ontario’s standards state “cryptocurrency is not legal tender and shall not be accepted” for regulated iGaming, and Brazil’s 2024–2025 rollout steers legal betting to traceable, banked methods—no crypto deposits. Australia keeps expanding ISP blocks. These approaches reduce legal on-ramps for crypto gambling, but do not eliminate offshore demand.
What regulation looks like in practice
Regulated markets apply KYC/AML, affordability checks, bonus reforms and dispute routes—while allowing adults to play within guardrails. The EU’s MiCA/Travel Rule stack is designed to make crypto payments as transparent as bank transfers. And where oversight is strong (e.g., Denmark, Ontario), channelization data suggests consumers can be nudged to safer choices.
The uncomfortable reality: bans alone don’t erase demand
In 2024, crypto-casino GGR was estimated at ~$81.4B, with players frequently bypassing blocks via VPNs and influencer-led tutorials—showing how resilient the offshore market can be when prohibition is the only lever. Effective policy must assume some players will seek crypto casinos regardless.
A balanced policy blueprint
- Treat gambling harm as a public-health priority
Mandate early-screening in primary care, expand treatment access, and fund independent research and education. Health systems are already moving this way in the UK. - Channelization with strict consumer protections
License and supervise operators that meet high thresholds (KYC, affordability, self-exclusion, ad limits), and measure success by channelization—aiming for Denmark-like levels. - Make payments transparent by design
Require Travel Rule-compliant rails and audited custodians for any crypto touchpoints; use AMLA/MiCA expectations to standardize compliance and deter mixers/anonymity services. - Calibrate incentives and advertising
Implement the UK-style ban on mixed-product incentives and cap wagering requirements; mandate plain-English terms and cooling-off prompts. - Keep targeted bans where risks are acute
For markets not ready to supervise crypto rails—or where harms spike—temporary prohibitions (e.g., no-crypto-deposit rules) plus ISP blocks can be a defensible bridge while capacity builds.
Verdict
Banning crypto gambling sounds simple but often pushes determined players offshore, where harms and laundering risks can be worse. Robust regulation—anchored to public-health goals and payment transparency—offers a more realistic path to reduce harm at scale. That said, targeted bans on specific rails (like crypto deposits for locally licensed sites) remain useful where supervisory capacity is still maturing. The most defensible approach in 2025 is pragmatic regulation with aggressive harm-reduction and AML—measured by channelization, not headlines.
FAQs
Is crypto gambling legal where I live?
There’s no single global answer. In the EU, gambling licenses are national while MiCA/Travel Rule govern crypto rails; in Ontario, licensed operators cannot accept crypto deposits; in Brazil’s regulated market, crypto deposits are also off-limits. Check your local regulator’s rules.
Does stronger AML for crypto actually exist now?
Yes. The EU’s Travel Rule applies from December 30, 2024, and FATF’s 2025 update stresses enforcement and stablecoin risks. AMLA adds EU-level supervision capacity.
Why not just block the sites?
Blocks help, but offshore GGR estimates and ongoing ISP takedowns show demand persists and routes around bans—hence the focus on channelization.
