With illegal sports betting activity running rampant across Asia, what does the future hold for a legal sports betting industry and which jurisdictions could be next to bite the bullet? IAG takes a closer look.
Asia is home to a massive illegal sports betting market, which regulators struggle to combat, even as many jurisdictions remain reluctant to embrace a framework that could increase government revenues and reduce gambling harm. So, what can be done? And where can change happen?
Recognize it, legalize it
“The aggregate illegal Asian sports betting market is not just larger than the US legal market – it is simply in a different order of magnitude,” Lau Kok Keng – Head of Intellectual Property, Sports and Gaming for Rajah & Tann Singapore LLP – tells IAG.
“The perception that illegal sports betting is disproportionately an Asian phenomenon is not unfounded,” furthers the legal expert – citing US$45 billion in bets by Japanese citizens “on overseas sports betting platforms in a single year, from a country where residents are largely prohibited from betting on sports legally.”
Seaport Research Partners Senior Analyst, Vitaly Umansky, adds, “The best way to do it is to make it legal. The amount of illegal betting that occurs both in the US and Canada has plummeted because of legalization.”
Lau agrees, noting “the US illegal market has been shrinking as a share of total handle – from approximately 36% in 2022 to around 24% … today.”
However, he also acknowledges that, despite legalization across 39 US states since 2018, “the illegal market’s absolute handle has actually increased even as its market share declined … legal availability does not eliminate the illegal market. Product quality, pricing competitiveness and accumulated trust are equally critical determinants.”
Finding the right path
Better odds, wider markets and in-play functionality from the illegal market face off against oftentimes “inferior odds, restricted markets, cumbersome KYC processes and poor mobile experiences” from their regulated counterparts, notes Lau.
“The jurisdictions most likely to achieve meaningful migration from illegal to legal channels are those that genuinely compete with illegal offerings on product depth and functionality; tax operators at rates that permit competitive pricing; invest in building consumer trust through transparent dispute resolution and robust data protection; and critically, understand their own consumers,” he explains.
Both Lau and Umansky agree that Singapore provides a strong regulatory model for gaming overall, but that its monopoly framework (under Singapore Pools) and limited categories of betting – football, motor racing and horse racing – severely limits growth.
“Any expansion to new sports requires the GRA (Gambling Regulatory Authority) to be satisfied that there is genuine unmet demand currently being served by the illegal market. That … creates a practical evidentiary problem: how does a regulator quantify illegal market demand with sufficient rigor to justify regulatory action?”
But even when evidence of illegal market betting has prompted legislative change, such a decision can be reversed. Hong Kong, where only horse racing and football betting are legal, serves as a prime example, with the government last year deciding to add basketball betting to the mix only to put that plan on pause just a few months later.
“Even a bill passed overwhelmingly by a legislature can be undone at a stroke by executive action, with Beijing’s hand widely seen behind the decisions,” notes Lau.
Umansky highlights that this decision came despite the Hong Kong Jockey Club (HKJC) doing everything right. The HKJC “effectively set up a private company within the Jockey Club to eventually do basketball betting … they brought in the people that actually know how to do online sports betting, basketball betting,” he said. It is this type of framework the analyst says any Asian jurisdiction looking to expand sports betting should apply.
Japan, South Korea, Vietnam and India
Both Singapore and Hong Kong, despite having respective monopolies on sports betting, are strong examples of successful frameworks. So, what other Asian jurisdictions could grab such a framework and run with it? And do they have to already have gaming?
For Umansky, it is “easier” for jurisdictions that already “have gaming in place and already have a regulatory body.” But that’s not a requirement, notes the analyst, pointing out multiple US states that “legalized sports betting [when they] didn’t have casinos.”
Lau notes that “Singapore’s model has genuine export value at the level of architecture,” pointing to the monopoly structure, strict AML and responsible gambling obligations, as well as a “well-resourced regulator with both civil and criminal enforcement tools, and severe but carefully calibrated penalties.”
The lawyer furthers that “a Singapore-championed framework of regional baseline standards could turn out to be a genuinely significant legacy.” So, who’s next in line?
Both Lau and Umansky agree that Japan could be a very strong contender, with Lau noting the nation “is the most consequential long-term opportunity.” This is based on “ongoing discussions within the Japanese government regarding legalizing sports betting,” the “extraordinary” scale of latent demand, “the wealth, the digital infrastructure, the passionate sports culture … and an internationally credible regulatory tradition”. What’s missing? “Political consensus.”
Who else? South Korea, agree the two experts, based upon its legal sports betting through the state-operated Sports Toto platform (offering betting on football, baseball, basketball, volleyball and golf).
“South Korea demonstrates a point relevant to every jurisdiction in this discussion,” notes Lau of the limited betting options. “If the legal product is uncompetitive, bettors will simply go elsewhere. The regulatory infrastructure for a genuine market exists; what is missing is the political will to make the legal product worth using.”
The expert also points to Vietnam, given that it “has been actively reforming its sports betting framework.” A draft decree currently under government consideration could “expand the range of permitted international football competitions, raise the daily betting cap tenfold from VND 1 million (US$38) to VND 10 million (US$380), and introduce mandatory identify verification for all bettors.” Just when this draft law will become law “remains to be seen, but the direction of travel is clear.”
India is another “transformative market,” notes Lau, but “sports betting remains caught in the thicket of state-level authority, moral ambivalence and cricket corruption anxiety,” with the Promotion and Regulation of Online Gaming Act 2025 muddying the waterway to legalization.
“A coherent national sports betting framework, even a cautious one modelled on Singapore’s structure, could be a watershed development for the entire regional market, but would require fresh legislative action distinct from the 2025 Act,” opines Lau.
But Umansky warns “one jurisdiction isn’t necessarily dependent on the other. I don’t think it would be like the domino effect we had in the US, as it’s all basically the same jurisdiction” under the federal framework – unlike the widely differing legal regimes of Asian countries.
Monopoly or otherwise?
While the monopoly system is in effect in both Hong Kong and Singapore, Lau notes that for the latter, switching to a “multi-operator regime – with demanding integrity and responsible gambling conditions as the price of entry – might better serve both the consumer and the state’s revenue objectives.” The good news, indicates Lau, is that “none of this requires new legislation”.
Umansky notes that, no matter the jurisdiction, “the government is better off allowing competition and bringing in third parties.” Either for jurisdictions with an established monopoly system, or those first opening up to sports betting, Umansky says that two operators are well-placed to swoop in and get a piece of the action.
“Flutter and Entain should be in pole position because they have a global footprint. They already operate in multiple jurisdictions and they have a wide reach,” he said. Other large operators, such as the US-focused DraftKings, are limited by their geographic scope, and European-centric sports betting operators simply don’t have the scale.
But don’t forget the operators already in Asia. Erick Su, Head of ArenaPlus – the sports betting arm of DigiPlus – tells IAG that the company is ready to expand outside the Philippines and “there is an opportunity out there in the next couple of years. We will make sure we are ready when there is an opportunity coming into the picture.”
Su highlights that the first step “is changing the mindset about sports betting,” and that “ArenaPlus can help through our development, partnerships and showcasing how legal sports betting can benefit the player, industry, society and the economy in general, in a positive way. There are lots of areas where we can be a leader and a good example to push the legalization of sports betting in Asia.”
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