“I think the government can regulate 80% of Brazil’s online gambling market”

ApostaGanha’s CCO Hugo Baungartner was invited to participate in the last episode of iGaming Business’ ‘World Series of Politics’ podcast. With Brazil at the center of the scene due to the possible legalization of casinos and bingos, the online gaming market is already a reality and is expected to grow even more in the future with a mostly regulated sector.

“We know that in the gaming world, it’s never 100% regulated, but I think [the Brazilian government] can [regulate] a very good share of the market. I think they can cover 80%,” he noted. 

Baungartner noted that the Brazlian government is considering blocking unregulated operators from using popular payment method Pix, which is controlled through the National Bank and enables transactions to occur in less than 10 seconds.

“Pix is really important and is used by 99% of the market,” Baungartner said. “They think they can block those operators through this payment method. It’s a really fair way to think.” 

The first online licensing window is currently open and will close in August, with operators required to pay a R$30m (US$5.5m) licensing fee. The legal online gambling sector will be live by 1 January 2025, according to the regulator’s timeline.Baungartner acknowledged that not all firms currently operating in Brazil will be able to afford the licensing fee, noting that the grey market would always be present in the country. 

“Some of them don’t have the US$5.5m to apply and they are comfortable as they are. I think the grey market will always be there,” he said. 

So far only one operator has applied for a license, but Baungartner says he expects up to 25 firms to apply before the closing date. 

“They know the online market is already up and running since the last few years ago. There is no other way to go and the population, government, and everybody is waiting for these regulations,” Baungartner added. 

Baungartner also said he expects the efforts to regulate in the country will drive mergers and acquisitions M&A. Earlier this month MGM Resorts announced it was acquiring Tipico’s US sportsbook platform, in a deal that many believe will drive MGM’s online efforts in Brazil and the rest of LatAm.