German Regulator Reports Continued Growth in Unlicensed iGaming Market, Enhances Tracking Methods

The German online gambling market faces persistent channelization hurdles, as a recent report from the national regulator, the Gemeinsame Glücksspielbehörde der Länder (GGL), indicates a continued expansion of the unlicensed sector. Despite ongoing efforts to refine market monitoring, the GGL’s latest assessment reveals that gross gaming revenue (GGR) from black market operators climbed to €547 million in 2024, a significant 17% increase from the €466 million reported in 2023. This growth trend is acknowledged by the regulator.

While illegal GGR is on the rise, Germany's overall channelization rate remains relatively stable, with approximately 77.03% of gamblers using regulated options. The GGL's methodology for estimating the shadow market traditionally blends player surveys, traffic data, and relevant benchmarks. Recognizing the need for enhanced accuracy, the GGL, in collaboration with the Blockchain Research Lab, is now incorporating advanced technological solutions, including machine learning, cryptocurrency analysis, and sophisticated behavioral data tracking, to improve its market intelligence.

Matej Novota, Head of Casino Research at Casino Guru, emphasized the core issue: "The debate over whether Germany's black market is 23% or 60% misses the more important point: it is growing, not shrinking." Novota highlighted the GGL’s own figures confirming the 17% GGR surge. He contended that current enforcement, evidenced by 231 prohibition proceedings in 2024 against hundreds of illegal websites, is not keeping pace. Novota proposed a shift in strategy, stating: "The path to genuine channelization is not more enforcement alone. It is making the licensed market more competitive." He urged Germany to revisit stake limits, bonus restrictions, and the user experience gap between licensed and unlicensed operators, arguing players "will vote with their clicks" for attractive legal products.

This GGL assessment emerges just months after the German Sports Betting Association (DSWV) claimed the illegal market dwarfed the regulated sector by an 11:1 ratio, suggesting potential skepticism from trade groups regarding the GGL's current 23% black market estimate. Further insights come from a survey of 2,000 active gamblers, indicating that 22.4% of total bets and 22.97% of total losses occurred on offshore, unlicensed platforms. Crucially, players on these non-licensed sites reported average monthly stakes of €1,425 and losses of €475, notably higher than the regulated sector's averages of €1,243 in stakes and €358 in losses. This disparity suggests offshore platforms attract a segment of players seeking higher limits or greater risk.

The GGL's findings underscore the complex challenge of channeling Germany's iGaming market. While methodological improvements are underway, the persistent growth of the illegal sector necessitates a comprehensive strategy that combines robust regulatory oversight with significant enhancements to the attractiveness and competitiveness of the legal gambling environment.