H2 Gambling Capital dropped a forecast on 25 May that landed like a stone in the UKGC’s policy pond. Illegal betting stakes in Britain are projected to leap from £17bn in 2025 to £33bn by 2028. That’s nearly double in three years. By the end of the projection, almost one in five pounds staked online in the UK could be going to an offshore operator with no licence, no tax, and no responsible-gambling protections.
Right then, what does that actually mean? And more interestingly, who benefits from the timing of the release?
The numbers
H2GC is the industry’s reference data shop. When they say £17bn flows to illegal operators today and forecast £33bn by 2028, that’s a defensible number, not a press-release stunt. The 19.2% projection for stake-share landing offshore by 2028 is the line that will get quoted in every consultation response from now to the autumn.
For context. The regulated UK market generated roughly £16.8bn in gross gambling yield in 2024/25 according to UKGC industry statistics. The black market is no longer a fringe leak. It’s a parallel market roughly the same size as the licensed one.
Why the timing matters
The Betting and Gaming Council pounced on this within hours of release. BGC CEO Grainne Hurst’s statement called the numbers “a wake-up call” and explicitly framed them as a warning to the UKGC on financial risk assessments.
That timing isn’t accidental. The UKGC’s Ian Angus spent the week before this release defending the FRA pilot to industry crowds, arguing that 97% of checks would be frictionless and only 0.1% of accounts would hit a manual review. The BGC’s response is essentially: even 0.1% of friction can push the marginal punter offshore, and offshore is now £33bn worth of marginal punters.
Whether you find the BGC’s argument honest or self-serving probably depends on which side of the affordability debate you’re on. I’ll say this much: the link between intrusive checks and offshore migration is real. The question is whether it’s the dominant driver or just one of several. The H2GC research, as released, doesn’t separate “moved offshore because of friction” from “moved offshore because of crypto convenience” or “always preferred unlicensed sportsbooks.” So the BGC’s interpretation is doing heavy lifting on shaky foundations.
What UK players should actually do
This is where we differ from the industry-lobby spin. The fact that black market sites exist and are growing doesn’t make them safer or smarter to use. Offshore casinos pay no tax in the UK, sure, but you also have no recourse if they refuse to pay your winnings. No IBAS to escalate to. No UKGC enforcement to fall back on. No deposit limits, which is great until it isn’t.
If you’re playing slots or live casino, stick with UKGC-licensed casinos. The bonus terms are tighter post the 10x wagering cap, the affordability checks can feel intrusive, but the protection you get if something goes wrong is worth the friction. Compare it to flying on a no-frills airline versus a charter flight from a country with no aviation authority. Same seats, but only one of those journeys has someone you can complain to.
What happens next
Three things worth watching over the next three months.
First, the UKGC consultation window on financial risk assessments closes this autumn. Expect the H2GC numbers to be cited heavily in operator submissions.
Second, the new Head of Illegal Markets role at the UKGC, advertised in May at £65,000 annual salary, suggests the regulator is finally treating offshore migration as an enforcement problem rather than just a regulatory side-effect. Whether that role gets the resourcing to actually move the needle is open.
Third, the 40% Remote Gaming Duty is now nine weeks into bedding in. The full effect on operator margins and bonus structures will hit Q3 results. If the BGC’s prediction is right, those numbers will show licensed operators losing volume to offshore. If wrong, the regulated market holds steady. Either way, the data point comes soon.
For UK players the immediate takeaway is unchanged. Play licensed. Read your bonus terms. Cash out at sensible intervals. The black market growth story is real, but it isn’t your problem to solve.