Brazil’s iGaming Boom: A New Era of Regulation, Risk, and Reward

Brazil's deep-rooted connection with sports, risk, and reward has entered a transformative era. As of January 1, 2025, the long-awaited iGaming regulation has officially come into force, turning a fragmented, semi-legal market into one of the world’s most promising licensed industries. With a vast population, high mobile penetration, and an insatiable passion for football and online casino gaming, Brazil is now a prime target for global operators. However, entry into this lucrative market is no easy feat. The regulatory framework is stringent, demanding full compliance, transparency, and an understanding of local intricacies.

The latest SOFTSWISS report on Brazil’s iGaming sector outlines a comprehensive roadmap, detailing the requirements for licensing, compliance measures, player preferences, and emerging risks. With over USD 3.5 billion (£2.76bn / €3.24bn) in monthly wagers already flowing through the system, the potential is undeniable—but only for those willing to navigate the regulatory complexities.

At the core of Brazil’s newly structured iGaming sector lies a robust legal framework built upon two pivotal laws: Law No. 13.756/2018, which first introduced fixed-odds betting, and Law No. 14.790/2023, which expanded regulation to online casino games and virtual sports. The Secretariat of Prizes and Bets (SPA/MF) now oversees all operators, requiring them to obtain licenses. Securing one is no small investment—operators must pay BRL 30 million (USD 5.18 million / £4.08 million / €4.79 million) for a five-year, non-transferable license, allowing them to operate up to three unique iGaming brands under a single approval. Additionally, operators must maintain a minimum reserve of BRL 5 million (around USD 863,000 / £680,000 / €765,000) to ensure financial stability.

Strict eligibility standards apply. Companies must establish a presence in Brazil, either through a local entity, a joint venture, or by ensuring at least 20 percent Brazilian ownership. Foreign operators looking to enter the market can also do so through mergers and acquisitions. The Parliamentary Inquiry Commission (CPI) on Match-Fixing and Sports Betting in the Federal Senate concluded its work on March 19, advocating for indictments and stricter regulations surrounding Brazilian football.

A 12 percent GGR tax has been imposed, with funds directed toward public services such as education and healthcare. Players, on the other hand, face a 15 percent tax on net winnings exceeding BRL 2,112 (approximately USD 364 / £287 / €323). Those who fail to comply with regulations risk severe penalties, including fines of up to BRL 2 billion (around USD 345.4 million / £272 million / €304 million), license revocation, and exclusion from future licensing rounds. In late 2024, Brazilian regulators cracked down on illegal operators, shutting down over 2,000 unlicensed betting sites—an unmistakable warning that enforcement will be uncompromising.

Cybersecurity is a top priority, given Brazil’s volatile digital landscape. The country experienced over 240 ransomware attacks in 2024, with the iGaming industry seeing a 146 percent rise in incidents. Nearly a quarter of iGaming operators reported being affected. Consequently, new regulations require the highest security standards, including the exclusive use of the “.bet.br” domain, in-country data storage (or compliance with stringent international standards), and mandatory multi-factor authentication, penetration testing, and firewall protection. Even third-party service providers must adhere to these measures.

Localization isn’t just a recommendation—it’s a legal requirement. Operators must provide full support in Brazilian Portuguese (not the European variant) and ensure 24/7 customer service through electronic and phone channels. This is more than a mere technicality; it’s about fostering trust in a country where gambling has historically faced skepticism.

As Brazil’s gaming industry embarks on a new chapter, H.E. Ambassador John Aquilina, Ambassador of Malta to Brazil, has weighed in on the country’s fresh gaming regulations and the industry’s overwhelmingly positive response. With SiGMA Group’s BiS SiGMA Americas 2025 scheduled to take place from April 7-10 in São Paulo, Ambassador Aquilina emphasized the summit’s growing significance as a central event in Brazil’s business calendar.

In a mobile-first nation where smartphone penetration stands at 97 percent and 91 percent of people reside in urban areas, mobile gaming dominance is undeniable. Players overwhelmingly prefer apps, citing security and performance advantages. PIX, Brazil’s instant and free transfer system, has now achieved widespread acceptance across major gaming platforms, while debit and credit cards, Boleto (used by the unbanked population), and e-wallets like Pay4Fun are also commonly utilized. Although cryptocurrency adoption is high, with nearly 17.5 percent of Brazilians engaging in crypto transactions, the government has outlawed crypto payments in gambling.

All gambling-related financial transactions must now be processed exclusively through institutions authorized by Brazil’s Central Bank. Cash, cryptocurrency, third-party accounts, and offshore transactions are prohibited—an area where unprepared operators could easily be caught off guard.

By 2029, Brazil’s online casino revenue is projected to reach USD 3.7 billion (approx. £2.92 billion / €3.43 billion), with an influx of 2.25 million new players. The typical gambler is middle-class, around 39 years old, and tends to spend less than BRL 50 (approximately USD 8.64 / £6.80 / €7.65) per month on recreational gaming. Casino preferences lean heavily toward online roulette (78 percent), blackjack (66 percent), table games, slots, and live dealer experiences. Most gaming sessions are short, typically lasting under 30 minutes.

On the sportsbook side, over 74 million Brazilians actively participate in betting. While football remains the dominant choice, other sports—such as esports and volleyball—are steadily gaining traction. The primary motivation for betting isn’t necessarily the glamour or jackpots but rewards (59 percent) and enhancing the experience of watching sports (19 percent).

Brazilian players tend not to confine themselves to a single gaming vertical. Many engage with at least four different types of games, frequently alternating between casino games and sports betting within the same platform. Hybrid models that integrate live sports betting with instant-win games are gaining popularity.

In late 2024, SENACON introduced a ban on bonuses and promotions—the very tools that operators previously relied on to attract players. Flashy advertisements, promotional rewards, and influencer-driven marketing have all been restricted. Now, consumer protection is the driving force, and marketing strategies must align with this shift.

While Brazil presents a golden opportunity for the iGaming industry, it is not without its challenges. Tensions between state and federal authorities, proposed “sin taxes,” and persistent public skepticism create potential hurdles. A 2024 survey revealed that 65 percent of Brazilians support tighter regulations or outright restrictions on gambling.

With high entry costs, strict financial oversight, and a cultural stigma surrounding "Jogos de azar" (games of chance), the Brazilian market is not for the unprepared. Yet, for those with the expertise, resources, and patience, the rewards could be immense.

As the SOFTSWISS Brazil iGaming report concludes, success in this market will depend on strong local partnerships, technical precision, and a commitment to player-first strategies.

By fLEXI tEAM