Illegal Gambling in the US Is Put at $97.4 Billion, According to a New Report

The US has a mostly regulated sports betting market, and iGaming is trying to push further. But a new report backed by Derek Webb’s Campaign for Fairer Gambling says offshore operators are still taking a huge share of the action — a number that matters to licensed PSPs because it points to where unlicensed traffic, and the compliance risk, still sits.

1. Webb, the founder of Three Card Poker, commissioned Gaming Compliance International to assess the market, and the report puts the total value of the US gambling market at about $125.6 billion.
2. Of that total, $97.4 billion is generated through operators that are not licensed in the state where they operate. The report says that means 77% of the market is controlled by offshore operators.
3. The report also says the illegal market has grown sharply. A previous estimate from the same company put it at 67.1% a year prior, which would imply growth of 45.2%.
4. The American Gaming Association, which represents licensed gambling companies in the US, gives a much lower estimate: $53.9 billion. The gap comes down to methodology. The AGA uses surveys and extrapolation from sample data, while Gaming Compliance International uses keyword sweeps across gambling platforms and machine learning to estimate value.
5. Webb, who sold Three Card Poker in 2011 after retiring and later spent a decade lobbying to cut the UK fixed-odds betting terminal maximum betting limit from £100 to £2, says he trusts Gaming Compliance International’s estimates because it has repeatedly produced accurate figures for licensed and regulated markets.

The practical takeaway for PSPs is straightforward: whichever estimate you prefer, both figures put the unlicensed US market in the tens of billions. That is not a rounding error, and it is not going away just because more states have launched online sports betting.