Cracking down on 71% of illegal gambling! The UK Gambling Commission is considering using crypto payments to bring black market activities back into the compliant system

The UK Gambling Commission plans to incorporate crypto payments to combat black markets, which account for 71% of the market, in collaboration with the FCA to establish a compliant framework by 2027.

From regulatory gray areas to mainstream adoption, the UK Gambling Commission explores the potential of crypto asset payments

The UK Gambling Commission (UKGC) recently signaled a major policy shift, planning to formally explore the possibility of integrating cryptocurrencies into a compliant gambling market. During the Gambling and Betting Committee (BGC) annual conference in London, committee research and policy executive director Tim Miller stated that digital assets are transitioning from regulatory gray areas to mainstream payment options.

Image source: Lottery Daily UK Gambling Commission (UKGC) research and policy executive director Tim Miller

This move reflects the UK government’s commitment to positioning the country as a global “crypto hub,” aiming to connect one of its largest economic pillars with modern consumer payment preferences. Data shows that approximately 8% of UK adults currently hold some form of crypto assets.

Miller emphasized that regulators are now shifting focus toward managing the presence of cryptocurrencies in the gambling industry. He advocates for a spirit of “exploring all possibilities” to promote innovation and avoid pre-set barriers that hinder progress.

This signifies a move away from the previously cautious and conservative stance toward a more proactive approach, demonstrating a determination to address transparency and market volatility challenges in blockchain. As fintech evolves, the gambling industry seeks to align its payment infrastructure with modern technology to enhance market efficiency. This decision comes amid pressures of digital transformation within the UK gambling sector, with the committee believing that staying current is essential to maintaining the UK’s leadership in the global gambling market.

Countering illegal markets: Data reveals crypto as a primary driver for players going overseas

The core motivation behind this policy shift stems from the increasing threat of illegal gambling activities to legitimate markets. Research by Yield Sec indicates that in 2024, illegal operators hold up to 71% of the European online betting and casino market. In the UK, unlicensed black markets utilizing pirated streaming services have captured 9% of the domestic market share.

Miller revealed that evidence shows “cryptocurrency” is one of the top two search terms leading UK players to illegal websites. This reflects a strong consumer demand for digital wallet payments.

Many players, seeking to use crypto assets, are forced to turn to offshore casinos lacking “know your customer” (KYC) protocols and responsible gambling tools, increasing their risks. To reclaim the market, the UK Gambling Commission plans to allow regulated, tax-compliant UK companies to accept crypto payments, establishing a secure and legal gateway. Miller describes this as an active safety measure. Technological innovation is key to combating illegal markets and protecting consumers, encouraging players to return to regulated environments. Through legitimate channels, regulators can better monitor fund flows and ensure operators fulfill social responsibilities, which is more effective than mere bans and restrictions.

Collaborating with FCA to build a regulatory framework, full crypto financial governance by 2027

To ensure compliance with regulations, the UK Gambling Commission has formally requested its Industry Forum to conduct an in-depth assessment of how to align crypto payments with the three core objectives of the Gambling Act: preventing crime, maintaining fairness and openness, and protecting children and vulnerable groups. This transformation will be synchronized with the FCA’s digital asset regulatory framework. The FCA plans to finalize relevant rules by 2026, with full implementation of the regulatory system scheduled for October 2027.

According to current plans, operators are expected to begin applying for Crypto Asset Service Provider (CASP) licenses as early as September 2026. Led by Miller, the government’s “Illegal Gambling Task Force” is working with financial institutions and social media giants to cut off offshore operators’ financial and digital channels at the source.

This cross-agency collaboration, combined with the submission of the “Financial Services and Markets Act (Crypto Assets) Regulations 2000” to Parliament in December 2025, demonstrates the UK’s effort to establish a leading global standard for digital asset governance in the gambling industry, ensuring that new technologies operate safely under strict regulation. This multi-department approach aims to bridge the gap between technological development and legal standards, providing clear legal guidance for market participants.

Strict eligibility screening creates high barriers, making it difficult for offshore illegal platforms to enter the formal system

Although the regulatory doors are opening to crypto payments, this policy change does not legitimize previously illegal offshore “crypto casinos.”

Miller explicitly states that there is no amnesty in the legalization process; current illegal operators will face stringent “eligibility tests.” The UK Gambling Commission’s licensing process requires in-depth investigations into operators’ financial integrity, compliance history, and commitments to consumer protection. Many long-standing offshore entities lacking KYC records will face insurmountable hurdles.

Additionally, compliant operators still need to overcome challenges related to asset volatility, which is a core part of the commission’s strategy to prevent gambling addiction. The price fluctuations of assets like Bitcoin ($BTC) pose difficulties in accurately assessing financial stability. The pseudo-anonymous nature of blockchain transactions also presents challenges for AML (Anti-Money Laundering) and counter-terrorism financing compliance.

UK regulators are attempting to balance consumer demand with maintaining strict social responsibility standards by incorporating emerging trends into the regulatory framework, reducing potential social costs and financial risks. If this experimental initiative succeeds, it could serve as a valuable reference for the global digital transformation of the gambling industry.