This week customer experience marketing agency A Game Above teamed up with Beanstalk to release their first regulatory support product Yield Sec.

With the introduction of Yield Sec, A Game Above and Beanstalk have noted that the collaboration has resulted in the ‘first tool’ to provide aid to governments and regulators in monitoring and removing ‘black market threats’, which has been hindering the progress of regulated marketplaces for licensed companies.

Steen Madsen, CEO of A Game Above, and Jack Symons, co-founder and director of Beanstalk, are both supervisory board members for and talked us through the thought process of their joint venture and the benefits that Yield Sec will bring to the industry.

Regulatory Evolution

When online betting and gaming began, circa 1996, there were no regulatory nor legal rules specific to the industry. Over time, successive jurisdictions have sought to curtail and control it, to either protect existing incumbent monopolies or to target online gaming specifically for two key reasons: taxation and player protection. 

Nearly all countries implementing online gaming controls, and a legal marketplace, have, however, suffered tax yield well below what they projected before creating the licensed market. In short, not all the business that exists online will migrate to legal, compliant and taxed online business after the legislative change. The online betting and gaming industry is, today, split over three states of regulatory existence, internationally:

1) Pre-Regulated Market: 

No specific laws exist in the market concerning online betting and gaming, chiefly concerning licensing, taxation and regulation. 

As such, there is no black or white market for online betting and gaming in such a territory – the market is permissible, both legally and practically, but all entrants acknowledge some legal risk concerning their future ability to enter the market if they choose to offer services in this pre-regulatory state.

2) Regulating Market:
In the process of drafting and enabling legislation and taxation: to varying extents, these markets may be labelled ‘grey’ if they have little to no policing or enforcement ability.

Germany, for example, is in this state presently, having announced a path to a protected market with licensing and taxation planned for 2021. 

Operating in a regulating market typically carries clear risk, most notably a possible inability to gain licensing due to so-called ‘bad actor’ legal clauses within future license conditions – if you stay in a market that has announced regulation is coming soon, you run the risk of facing a ‘cool-off’ period when licensing begins or, in some cases, being excluded altogether.

3) Regulated Market:

A market featuring licensing and taxation, with policing and enforcement, typically only against the licensed operators.

The UK would be a prime example, and even in this most mature of licensed, taxed and regulated online gaming markets, the present government has made very clear they are about to embark on a fundamental change to today’s business.

Player Understanding

Across this evolution, operators have progressed from open market status to increasingly regulated and restricted conditions across individual territories, as the once global business continues to fragment into very specific, locally-licensed operations on a by-country or state basis. 

Not all the businesses that were online shifts with the regulatory change, however, to become legal, compliant and taxed for the benefit of each local market. Some business remains online, adapts to changed marketing conditions and still services a country or state, illicitly, becoming a black market operator.

The issue with the status of this black market, historically and today, is that few, if any, consumers, actively identify the sites and apps of these operators as illicit, illegal or irresponsible.


Due to the nature of finding them and accessing their services. They look, feel and operate like any other online betting and gaming provider, and consumers locate them via identical means: search engines, social media influencers, online ads, referrals, PR mentions, etc. At no point did any consumer need to go to the bad part of town to find some betting and gaming – it was, and is, readily available via their smartphone handset and a Google search. 

Searching online for a casino or sportsbook will deliver mixed results: some legal, licensed sites, in those countries and states that have enacted and passed legislation to allow online betting and gaming; and, many unlicensed, offshore sites, based in locations like Curaçao and Panama, available online but without any reference to national or state laws, disrespectful of restrictions to specific products, and all, alarmingly, without any contribution to national/state taxation or facilitation of player protection measures.

If players are indifferent towards whether an operator is legal, licensed and regulated that is a by-product of the lack of education and public awareness, generally. The legislation and licensing of online gaming is a public policy that has seen little to no public advertising and campaigning, as, for example, the wearing of safety belts in cars or cessation of smoking in public places did. 

The mass-market have little to no understanding of what is and is not a licensed site, nor why such a system even exists, and is potentially helpful, and certainly harm-reducing, for them.

Darkness Calls

The shadow of the black market across betting and gaming has long existed but is more obvious, today, than at any time. The more that markets regulate, adapt and experiment with aspects of the business like bonus, staking, activity and deposit caps, ID verification, KYC, AML, and further, the more the black market shadow comes to tempt players back to the ‘gambling they knew and loved’ and can still get, offshore but online, from unlicensed, illicit operators. 

No CRM and retention bonuses at licensed Swedish sites? No problem. Just hit Google and search for bonus bets or bonus casinos and you will find dozens, if not hundreds, of options. None are licensed. None protect their players. None pay any taxes or adjust their operations, advertising and business as usual functions to become and remain compliant. But, that’s the point with the black market.

The more conditions placed upon the licensed, legal, regulated business, and the more we continue to play the strange game of blame, name, fine and shame with regulators only able to punish the licensed operators, but never the unlicensed, the more risks we leave available and present for players, of all types. 

We also fail to consolidate and safeguard an industry that, from its inception, needed controls and oversight which the licensed operators have accepted, adapted to and welcomed, and should not face unfair ‘competition’ concerning since the black market sites they face do not participate for player attention and revenue on anything like the same playing field.

To read Part two of A shadow across regulated markets, click here.