British regulator takes “tentative first step” towards crypto gambling
The Gambling Commission has asked industry stakeholders for ideas on the crypto gambling regulation amid rising demand.
UK.- The British Gambling Commission is looking at the introduction of a framework to allow cryptoassets to be used for gambling. Executive director Tim Miller told the Betting and Gaming Council (BGC) Annual General Meeting today (Thursday February 26) that proposed legislative changes and a growing appetite among punters had prompted the regulator to see a potential path forward.
He noted that the proposed Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2025 would bring cryptoassets within the regulatory remit of the UK’s Financial Conduct Authority from October 25 2027. This change would require firms that wish to undertake new cryptoasset regulated activities to be authorised by the FCA.
“That, as well as the growing appetite we see from punters, means we do now want to start looking at what the potential path forward would be to create a way for cryptoassets to be used as a consumer payment option for licensed and regulated gambling in Great Britain,“ Miller said.
“As a tentative first step, I’ve asked our Industry Forum to look at how they think this could be progressed sensibly and in line with the licensing objectives. Now, I’m not going to set any deadlines or arbitrary timelines today. That wouldn’t help anyone. But at the Commission we know this is something where demand exists.
“Our illegal markets research also gives us evidence that crypto is one of the two biggest searches that lead British gamblers to illegal sites. There will be significant challenges and risks to overcome in considering this topic but I am keen that we approach this in the spirit of exploring the art of the possible rather than starting from a position of finding all the reasons not to innovate.
“And as we slowly but surely get towards the time our own role in implementing the Gambling Act Review will come to an end, supporting innovation is something that we want to be able to point some of our resources towards. And again, given the changing picture and our expectation of growth in the illegal market, we think this is important in terms of helping keep consumers safe. Innovation should be and can be one of our central consumer protection tools when it comes to the illegal market.”
Focus on unlicensed gambling
Earlier in his speech, Miller has recognised the impact of the upcoming rise in British gambling taxes and the proposed rise in Gambling Commission fees. He also reiterated the regulator’s commitment to tackling unlicensed gambling, and to involving social media firms, big tech and affiliates in that effort.
“I’m delighted with the good start made by the Government’s Illegal Gambling Taskforce, which I sit on and chair one of its subgroups,” he said. “It includes representatives from finance and the world of social media and I know getting those sectors to actively help suppress illegal gambling is something the Minister is equally committed to.”
“It’s early days but there are some positive signs,” he added, noting that he had met with Meta and received a commitment that the tech giant would collaborate with the commission, especially in relation to “not on Gamstop” sites.
“I intend to hold them to that,” Miller said. “Again, as things progress we will keep you informed but at the Commission we know time is of the essence and we will look to move forwards as quickly as we can.”
A more industry-friendly Gambling Commission?
Miller also suggested the Gambling Commission’s role may be adapting following a period of imposing regulatory order. That means encouraging innovation and avoiding stifling the industry it regulates.
He said: “The regulatory reforms of the last ten or so years were necessary. The compliance failures in the industry back when I joined the Commission in 2016 were so widespread and so egregious that stronger regulation was both needed and was inevitable. However, in more recent times there has been a noticeable change in our casework. Don’t get me wrong – we still have high volumes of casework and the complexity is increasing but the days of multimillion pound financial penalties happening almost weekly do appear to be behind us.
“That’s not a reason for operators to lose focus on compliance. But a more stable compliance picture does make it easier for us to have more sensible conversations about opportunities to enhance the offer to players and how regulator and government can play a part in supporting industry to do that. Conversations that 5 years ago would simply have been impossible to have.”
He added: There will be those that suggest that this signals the Commission moving towards weaker regulation and accepting greater risk for consumers. That is clearly nonsense and I would suggest that anyone who had their licence suspended over the last year or so wouldn’t feel that our approach to enforcement has been getting softer. Nevertheless, it has to be possible to take robust enforcement action for regulatory breaches and still make space to support and even encourage consumer focussed innovation.
