The murky business of online gambling

When you think about gambling, you might conjure up the bright lights on the Vegas strip, where the entire infrastructure was built around a person dropping a token into a machine.

Online gambling needs no such infrastructure or fancy hotel rooms. It relies entirely on the belief the customers have in fair software — and they really do believe. According to Forbes, online gaming topped $72 billion in 2021, up from $64 billion in 2020.

To put that into perspective, Las Vegas brought in just $2.1 billion in gambling revenue in the third quarter of 2021, a record-breaking sum.

So customers believe, but should they?

In a business that is designed to take money, there is no online gaming commission. Online casinos can’t be legally set up in the U.S. and Web publishers on any platform can’t accept gaming ads.

Illegal online gaming sites often have problems processing cash, since the biggest transaction companies won’t take their business.

Nonetheless, anyone can place a bet.

The problem with online gambling is that everything could be fake: The other players, the odds, the games, the payouts, the winners, and the dealers. It’s a world created by the software.

How do gamblers know if online casinos are even paying anything out? They don’t know. They can’t know if the software is set to some kind of win probability consistent with terrestrial casinos or not. While some gaming sites claim to be inspected by accounting and gaming industry firms, there is nothing to stop an online casino owner from paying nothing. After all, he controls the software.

But the customers still flow in. By 2025, projections suggest that the market will be worth $112 billion.