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Illegal online gambling operators in the US grew revenue nearly twice as fast as the licensed sector did last year, according to a new report produced by Gaming Compliance International (GCI) and commissioned by the Campaign for Fairer Gambling (CFG).
The study found that unregulated sites and apps generated $97.4 billion in gross gaming revenue (GGR) from US consumers in 2025, up from $67.1 billion in 2024.
That growth rate of 45.2% compares with a 23% rise for the regulated online gambling sector, which climbed from $23 billion to $28.3 billion over the same period.
Taken together, online gambling losses across the legal and illegal sectors rose from $90.1 billion in 2024 to $125.6 billion in 2025, an increase of 39.4%, according to the report.
Unlicensed sites and apps now account for 77% of the total US online gambling market by GGR, up from a claimed 74% the year before.
The report argues that legalising online sports betting and casino gaming has not slowed the expansion of illegal operators. Instead, GCI concludes that legalisation has expanded the overall gambling market while unregulated operators have continued to grow.
“The legal sector uses the presence of the illicit sector to demand legalisation, then asks for low tax and regulation to compete against the illicit sector,” said Derek Webb, who funds the CFG. “Taking action against bad actors in the illicit sector is the solution and must be the priority for all stakeholders.”
State data highlights differences between regulatory models
GCI’s report also applies what it calls a Loss Ratio, which compares gambling GGR per capita with income per capita to express gambling losses as a proportion of income.
| ONLINE GAMBLING LOSS RATIO BY US MARKET TYPE — 2025 | |||
| US state market type | Total GGR 2024 | Total GGR 2025 | Unregulated GGR 2025 |
| Sports betting + online casino regulated | 1.12% | 1.38% | 0.67% |
| Sports betting regulated only | 0.77% | 0.99% | 0.80% |
| No regulated online betting or casino | 0.31% | 0.44% | 0.44% |
| US overall | 0.62% | 0.83% | 0.64% |
| Loss Ratio compares online gambling GGR per capita with income per capita. Source: GCI / Campaign for Fairer Gambling. | |||
States with both legal online sports betting and casino gaming recorded an average Loss Ratio of 1.38% in 2025. States with legal online sports betting but no legal online casino averaged 0.99%, while states where neither product is legal recorded an average of 0.44%.
The figures show that gambling losses relative to income were highest, on average, in states offering both regulated online sports betting and casino gaming. However, the state-level results also show that significant unregulated activity persists across different regulatory models.
Louisiana recorded the highest ratio of gambling spending to income of any state and also the highest ratio of unregulated gambling expenditure to income, with the report attributing most of that spending to illegal operators.
West Virginia, where both online sports betting and casino gaming are legal, recorded a total Loss Ratio of 1.57%, of which 0.87 percentage points were attributed to the unregulated sector.
California, where neither online sports betting nor online casino gaming is legal, recorded a Loss Ratio of 0.43%, which the report attributed entirely to unregulated activity.
The state comparisons underpin the report’s broader conclusion that the presence of regulated online gambling does not, by itself, eliminate demand for unregulated operators.
The CFG says the growth differential between the regulated and unregulated sectors supports stronger action against illegal operators before further online gambling expansion.
It should be noted that CFG, the advocacy group that commissioned and funded the report, has consistently opposed gambling market expansion.