for early access to the latest igaming videos!
and get the latest igaming news first!
Once a favourite in Brazil’s grey market, crypto betting has been pushed out as new rules take control of the country’s online gambling industry.
For years, cryptocurrency was the backdoor into Brazil’s booming gambling scene. Offshore sites welcomed it, players liked the anonymity, and transactions were quick and easy. Bitcoin and Ethereum became the silent currency of a fast-growing market that existed outside the law.
But now, under Brazil’s new legal framework for iGaming, crypto has been cut off, and the shift is paying off. Tax revenue from regulated online gambling soared to over BRL 3 billion between January and May 2025, demonstrating the effectiveness of formalising the market. Read more about it here: Brazil’s Online Gambling and Betting Revenue Surpasses BRL 3 Billion in 2025.
A law that changes the game
The government’s message was clear on 1 January 2025, the day Brazil’s legal betting market officially launched.
Under Normative Ordinance No. 615, operators are banned from accepting crypto. Payments must now go through traditional electronic transfers that can be tracked and taxed.
Why the change? Officials wanted to bring transparency and control to the system. Crypto transactions, while technically traceable, are harder for regulators to monitor in real time. For a government desperate to shut out the black market, banning them was the cleanest option.
How crypto grew in Brazil’s grey market
The ban matters because crypto had become so visible in the years before regulation.
Back in 2018, when Brazil first allowed sports betting but stopped short of a full framework, the market drifted into a grey zone. Between that first step and the passage of Law No. 14,790/2023, offshore operators filled the gap.
With no official rules, crypto became the perfect tool. Players could deposit and withdraw with ease, skipping the checks that came with banks or local payment firms. For young, tech-savvy Brazilians, it quickly became normal.
During this period, crypto casinos weren’t only a niche. They were a headline part of the offshore boom.
The numbers tell a different story
But here’s the twist: for all the hype, crypto was only a tiny slice of the market.
On the iGB podcast Right to the Source, Ed Birkin of H2 Gambling Capital estimated that just 0.7% of transactions in Brazil actually went through crypto.
That means the overwhelming majority of players were still using more traditional payments, even in the unregulated years.
This is why regulators felt confident pulling the plug. Losing less than 1% of activity was a small price to pay for the promise of a clean, fully regulated market.
The risk of pushing players back
Of course, the story doesn’t end there.
Critics warn that without robust enforcement, players may return to the gray market. A recent study estimates Brazil loses up to R$10.8 billion annually due to illegal betting, highlighting the economic risks of insufficient regulation. Learn more here: Brazil Faces R$10.8 Billion Annual Loss Due to Illegal Betting Market, Study Finds.
The Central Bank of Brazil has already moved to tighten enforcement, monitoring crypto exchanges for suspicious activity and blocking payments tied to gambling. Banks have been told to close down accounts if they’re linked to offshore play.
But critics warn this could backfire. Hardcore players may simply slip back into the offshore crypto casinos, where there are no taxes, no checks, and no protections.
For these critics, the fear is clear: banning crypto could actually weaken channelisation – the effort to steer players towards regulated sites, by leaving a small but determined audience with no legal option.
Licensed operators, for their part, are doubling down on local trust. They’re pushing strict KYC checks and safer payment rails to convince players that the regulated path is better.
What it means for the bigger picture
Globally, crypto gambling is still small compared to traditional markets.
Birkin estimates the true size at around $3.5 billion, a fraction of what some headlines claim.
Countries like Curacao and Costa Rica continue to host crypto-friendly sites, and some operators argue that banning digital assets outright is short-sighted.
But Brazil isn’t aiming to set a global precedent. It’s trying to fix its own market, one that’s been plagued by illegal betting and lost revenue for years. By forcing all payments through traditional systems, it hopes to close loopholes and stamp out money laundering.
Whether this gamble works is another story.
A new chapter for Brazil’s iGaming
So where does this leave players and operators?
For players, it means no more Bitcoin bets on regulated sites. If they want to stay inside the system, they’ll need to use bank transfers.
For operators, it means designing around a crypto-free ecosystem, leaning into local banking partnerships and proving they can deliver safety and entertainment without digital coins.
And for Brazil, it means testing whether cutting out crypto strengthens the regulated market or simply pushes a slice of the audience back into the shadows.
What’s clear is that the country has made its choice: a crypto-free gambling market, with transparency and control put ahead of convenience.
The story of crypto in Brazil isn’t over. But for now, the door is shut.
Source: iGaming Business
