The black market plays a major role in the online gambling sector. This is one of the key findings of the study ‘Online Gambling in Germany: Channelling and Development of the Black Market’ by the Handelsblatt Research Institute for Sport1 Medien AG.

While the Joint Gambling Authority [Gemeinsame Glücksspielbehörde] of the German federal states assumes that illegal online gambling is only of minor importance, existing studies and market developments suggest that the market share of illegal gambling has recently increased and is now above 50 per cent. For virtual slots, the role of the black market is even more significant. In autumn 2024, the Hessian Fiscal Court estimated that the black-market share in this segment exceeds 80 percent.

The study by the Handelsblatt Research Institute found that the black-market share in the online sector overall is likely to be above 50 percent. In the segment of online casinos and virtual slots, the black market plays an even larger role, with a share of between 70 and 80 percent.

It should be noted in this context that illegal online gambling providers increasingly attract players who play with high intensity and above-average stakes. Therefore, the black market in the gambling sector is even more significant with regard to the volume of gambling than is reflected in the above percentages. Apart from the effects of this development on player protection, the German federal states lose several hundred million euros in tax revenue each year.

To strengthen player protection and increase tax revenues, it is necessary to combat the black market. However, this is challenging due to the ease of digital access. Instead of taking a prohibition approach, the objective should therefore be to strengthen the legal gambling market. Key measures to achieve this include adjustments to taxation, game speed, betting limits, monthly deposit limits, the approval of new games, and the regulation of online casinos. A change of the taxation system to gross revenue as the basis of taxation – as is common throughout the EU – would also strengthen the legal online gambling market.