Six months into lLegal iGaming, the senate pushes back — but at what cost?
In January 2025, Brazil made a long-awaited move that reshaped its digital economy by integrating its regulated online gambling market. The legislation opened the door for online sports betting, casino games and bingo under government oversight. The results were immediate and dramatic.
In just three months, betting volume surged past R$20 billion. Over 5 billion platform visits were logged in the first quarter. The combination of a mobile-first population, immediate payments through Pix, and high demand produced one of the fastest-growing online gambling markets in the world.
But now, only six months into Brazil’s bold experiment with regulated online gambling, a Senate inquiry is calling for a sweeping overhaul. At the heart of the proposal lies a measure that has already rattled industry players: a potential nationwide ban on online casino games. The recommendation arrives at a crucial moment, just as the sector is gearing up for what many believed would be its next phase of expansion.
Is The Senate Report a Regulatory Reset?
This week, the Senate’s Inquiry Commission on online gambling, led by Senators Soraya Thronicke and Hiran Gonçalves, unveiled a set of 16 policy recommendations. These proposals emerged from a months-long investigation into the social and financial impact of online betting and casino games in Brazil.
One of the most controversial recommendations calls for a ban on online casino-style games such as slots and roulette, based on the claim that they pose a greater risk to consumers than sports betting. Yet, according to one of Brazil’s leading casino operators, slot games alone account for 91% of user engagement on their platform. These games are not only central to player activity but are also subject to taxation, with both gameplay and large winnings contributing directly to government revenue — factors that strengthen transparency and market oversight.
Additional recommendations include new restrictions on gambling advertising, particularly during prime-time television. The commission also calls for enhanced user protection mechanisms, such as mandatory age and income checks, and a crackdown on influencer marketing that allegedly ties earnings to user losses.
In the realm of enforcement, the report recommends the creation of a National Sports Integrity Authority, charged with monitoring fraud, overseeing data audits, and enforcing match-fixing laws. The message from lawmakers is clear: without stronger guardrails, the country’s promising new market risks veering off course.
Economic Promise Meets Political Pressure on Casinos
The timing of the Senate report is noteworthy. Over the past half-year, the market’s performance has exceeded expectations. Betting volume, engagement, and tax contributions are all climbing. For operators, investors, and tech providers, the economic impact of casinos in Brazil have been noticed, as it has quickly become one of the most attractive markets.
But the proposed restrictions raise concerns that Brazil may be stifling its own success. The outright ban on online casinos, in particular, could block the next stage of growth. According to industry voices, casino gaming — when regulated properly — can generate significant revenue and user engagement without compromising player safety.
Many argue that the solution lies not in prohibition, but in smarter regulation. This means implementing robust controls for age verification, affordability checks, and responsible gaming, while still allowing diverse product offerings. Without this balance, the country risks pushing players back to unlicensed sites operating outside the law.
A recent study by ENV Media examining the user journey on regulated casino platforms highlights the emphasis licensed operators place on user experience and cybersecurity. Under Brazil’s new regulatory framework, mandatory KYC protocols have been implemented alongside the adoption of the .bet.br domain, signaling legitimacy and compliance. Users reported consistent reliability with Pix for deposits and withdrawals, while most platforms were praised for offering intuitive, user-friendly interfaces.
Casino Gaming: The Next Frontier, or a Missed Opportunity?
While sports betting is currently the backbone of the legal market, many operators are eyeing the casino vertical as the next phase. Industry insiders like Zak Gusarov from Uplatform believe that the true revenue potential will be unlocked once online casinos are given the green light.
Adding another layer to the unfolding debate, Finance Minister Fernando Haddad has approved a provisional measure increasing the gross gaming revenue tax from 12 to 18%. The hike, designed to shore up the federal budget, takes immediate effect but will require congressional approval within 120 days to remain in force.
Industry groups are already warning that the effective tax burden could exceed 50% once local taxes and fees are added. For large operators, the costs may be manageable. But for smaller entrants, the combination of licensing fees, compliance requirements, and rising taxes may prove unsustainable.
The Ministry of Finance has pledged to continue enforcing against illegal operators, with over 11,000 unauthorized websites already taken down. However, the long-term health of the legal market will depend on ensuring that it remains accessible, fair, and profitable for compliant actors.
The Ad Dilemma and the Role of Influencers
Advertising remains one of the most contentious aspects of the regulatory debate. A recent report showed a 47% increase in gambling-related ad spending this year. With visibility comes scrutiny.
The Senate report proposes curbs on promotional strategies, including welcome bonuses and influencer campaigns that may mislead users. It also calls for national awareness campaigns and the promotion of responsible gambling education in schools.
Some operators fear that a blanket approach to ad regulation could blur the line between licensed and unlicensed operators. If legal brands are silenced, consumers may find it harder to distinguish who is following the rules and who is not.
What happens next will shape the future of iGaming in Brazil. The current market is thriving, but it stands at a crossroads. The Senate’s recommendations could usher in a more secure, responsible era of gaming or, depending on execution, could create new barriers to growth and innovation.
