The March 2025 update from Waterhouse VC, led by Tom Waterhouse, examines the evolution of Brazil’s gambling industry as it shifts towards formal regulation. With a long history of unregulated betting, Brazil is now set to become a major player in the global market, forecasting revenues of $6.3 billion by 2038. The article underscores the challenges and dynamics of entering this emerging market as regulations tighten.
In March 2025, Waterhouse VC’s monthly newsletter, authored by Australian bookmaker Tom Waterhouse, highlights the striking developments in Brazil’s gambling sector. Since its inception in August 2019, Waterhouse VC has reported a monumental gross return of +3,550%, annualized at 91%. This month’s focus centers on Brazil, which is on the brink of transforming its betting industry through enhanced regulatory frameworks.
The commencement of 2025 heralded a pivotal moment for Brazil’s betting landscape. A newly established regulatory structure replaces the grey market that previously allowed unlicensed operators to thrive. Brazil aims to emerge as a prominent regulated betting economy, with projected revenues of $6.3 billion by 2038, presenting vast opportunities for operators and suppliers.
Historically, Brazil’s betting practices remained concealed for over 80 years until the prohibition of casinos by President Eurico Gaspar Dutra in 1946. Despite this ban, demand for gaming persisted through offshore casinos and informal lotteries like Jogo do Bicho, which has roots dating back to 1892. Latin America’s affinity for card games, particularly poker, has only grown, and Brazil has produced many elite poker professionals.
Football remains Brazil’s most popular betting sport, constituting over 80% of all sports wagers. While street betting was prevalent, the rise of the internet in the early 2000s led to a surge in online betting facilitated by advancements in mobile technology and digital payment systems, notably Pix. The pre-2025 landscape was marked by significant offshore betting, thus urging the government for reform.
The legalisation of sports betting in Brazil in 2018 did not align with comprehensive regulations, allowing an influx of offshore operators. By December 2023, decisive regulatory steps emerged as wagering became embedded in Brazilian culture, with an impressive 68% of the populace participating in gambling activities.
The transition to a regulated market formally commenced in 2025, with initiatives to eliminate unlicensed operators intensifying. Currently, Brazil benefits from a centralized payment system, Pix, controlling 96% of transactions, presenting a formidable challenge to illegal operators while ensuring uninterrupted betting transactions for users.
Entering the competitive Brazilian market is no small feat. The regulatory framework imposes significant costs and requirements on operators, including a five-year license fee of $6 million, necessitating local establishment and compliance with payment regulations. This exclusivity propels the market toward well-established firms capable of managing operational demands effectively.
Moreover, successful market penetration hinges on collaboration between established companies and local talent, specifically targeting marketing strategies that resonate with Brazilian customers. The considerable advertising expenses and sponsorship deals underscore the intense competition and the potential for mergers and acquisitions as firms strive for market stability.
On the supplier front, the rise of esports presents additional avenues for growth. The increasing viewership of esports, particularly through platforms like Twitch, indicates burgeoning opportunities for specialized betting providers. Brazil’s regulatory shift allows comprehensive offerings, attracting significant interest from suppliers keen to develop tailored services for the local market.
In summary, Brazil’s gambling industry stands on the precipice of a historic transformation, fuelled by new regulations and burgeoning market potential. The integration of a formalized betting structure offers immense opportunities for operators and suppliers alike while demanding strategic approaches toward customer engagement and responsible gaming practices. With a competitive landscape emerging, only those equipped with local insight and significant investment are likely to thrive. As the market evolves, continual vigilance regarding regulatory developments will be essential for success.
Original Source: next.io
