Cryptoassets and gambling: what a regulated UK regime could mean for operators, suppliers and the market

It may make cryptoassets more credible within a regulated framework, but it is unlikely to reduce the Gambling Commission’s (“the Commission”) expectations around crime prevention, customer due diligence and safer gambling. 

For operators and suppliers, the key question is not simply whether crypto can be accepted, but whether it can be integrated into existing controls in a way that remains commercially workable and regulatorily robust.

How the incoming cryptoasset regime could affect gambling

The Financial Conduct Authority’s (“FCA”) new regime will bring specified cryptoasset activities within the UK financial services perimeter under the Financial Services and Markets Act 2000, with commencement expected later this year. 

In practical terms, that means firms carrying on in-scope cryptoasset activities will need FCA authorisation and will be subject to a broader regulatory framework than the current anti-money laundering registration model. That shift is significant because it is likely to make regulated cryptoasset services more credible across a range of sectors, including gambling.

For gambling operators, however, FCA regulation is unlikely to be the end of the compliance analysis. 

Even if crypto payment processors become authorised and take on a greater share of the financial services compliance burden, operators will still need to satisfy their own licensing obligations. 

The Commission’s focus on keeping gambling fairer, safer and crime free means that any route to crypto acceptance is likely to involve a higher, not lower, bar in areas such as source of funds, customer risk profiling, anti-money laundering controls and responsible gambling safeguards. In that sense, the new regime may make crypto easier to structure within the regulated economy, while simultaneously increasing expectations as to how it is used in a gambling environment.

Convergence rather than alignment

At this stage, the more likely outcome is regulatory convergence rather than full alignment. The FCA will regulate cryptoasset activities as financial services. The Commission will continue to regulate how payment methods are used within licensed gambling, with particular attention to licensing objectives and consumer protection. 

Those are related but distinct questions. 

One regulator is focused on the conduct, prudential soundness and market integrity of cryptoasset services; the other is concerned with whether gambling operators can use those services without creating unacceptable risks around crime, consumer harm or regulatory arbitrage.

That distinction is reflected in the Commission’s public statements. In a speech at the Betting and Gaming Council’s (“BGC”) Annual General Meeting on Thursday 26 February 2026, BGC’s executive director Tim Miller said the Commission wanted to explore a pathway for cryptoassets to be used as a consumer payment option for licensed gambling in Great Britain, but made clear this was a tentative first step and that there was no indicative timetable. 

He also linked any future progress to the Commission’s licensing objectives, rather than suggesting that FCA regulation alone would answer the gambling-specific concerns.

What this could mean for payment processors and suppliers

Payment processors serving the gambling sector are likely to come under pressure to adapt well before October 2027. As cryptoasset activity moves into a fully regulated space, some providers may decide that offering exchange, conversion, transfer or custody-related services is necessary to remain competitive. 

That is likely to require more than simply adding new payment rails. 

Providers may need to invest in authorisation planning, governance, technical infrastructure and compliance capability so that they can support customers operating in heavily regulated sectors such as gambling.

In practical terms, gambling-facing suppliers are likely to be expected to provide meaningful compliance support alongside payment functionality. That may include audit trails, wallet screening outputs, transaction histories, blockchain analytics, evidence of wallet ownership, sanctions screening results and other data that enables operators to make and document risk-based decisions. 

The more a processor can provide reliable visibility over how a cryptoasset payment was initiated, transferred and converted, the easier it will be for operators to demonstrate that crypto can sit within their existing control framework rather than outside it.

There is also an important business model distinction to draw. Allowing a customer to deposit a stablecoin amount which is converted into fiat value before being credited to a gambling account is materially different from facilitating direct betting and settlement in cryptoassets. 

The latter raises broader questions about whether additional regulated cryptoasset activities are being carried on, and whether further authorisation is required somewhere in the operating chain. For many businesses, the initial route into crypto may therefore be a tightly controlled payment and conversion model rather than a fully crypto-native gambling product.

Technical and compliance issues for licensed operators

The central issue for operators will be whether crypto can be integrated into existing anti-money laundering, social responsibility and safer gambling controls without weakening them. That is likely to require robust customer identification processes, wallet ownership checks, source of funds and source of wealth analysis, blockchain monitoring, transaction monitoring, wallet blacklists, escalation procedures and suspicious activity reporting. Put simply, operators will need to show that they can achieve at least the same level of visibility and intervention as they would expect with more traditional payment methods.

A particular concern will be preventing licensed gambling platforms from being used to launder the proceeds of fraud or other illicit activity through cryptoasset deposits and withdrawals. 

That risk is one reason why the Commission has historically taken a cautious approach. 

Even if regulatory changes make crypto acceptance more feasible, operators are likely to need clear internal governance, documented risk assessments and technical tools capable of identifying suspicious wallet activity and unusual transaction patterns at an early stage. Operational resilience and cyber security will also need to evolve, given the different custody, fraud and systems risks that cryptoasset-related services can introduce.

Could a regulated framework attract crypto-focused operators back to the UK?

A more settled and credible regulatory framework could make the UK market more attractive to some crypto-focused gambling businesses. Greater clarity around what is and is not permitted, combined with the availability of FCA-authorised suppliers, may reduce some of the uncertainty that has historically made the UK difficult terrain for crypto-based models. That said, any assessment of market re-entry will remain highly firm-specific and will depend on how each operator’s model interacts with both financial services regulation and gambling regulation.

It would therefore be risky to assume that a regulated crypto framework will automatically result in the return of any particular brand or platform. The more accurate point is that regulation may make the UK easier to navigate for firms that are willing and able to comply with both regimes. It will not dilute the broader requirements of the UK gambling framework, and businesses that cannot meet those standards are unlikely to find the market materially easier simply because cryptoassets become more formally regulated.

Black market impact: opportunity, but not a complete solution

There is a credible argument that a regulated route to crypto payments could help reduce the flow of UK customers to offshore operators. 

In his speech at the BGC’s AGM in February 2026, Tim MIller cited evidence from the BGC’s illegal markets research that “crypto” is one of the two biggest search terms leading British consumers to illegal gambling sites, and he expressly linked the Commission’s interest in this area to illegal market concerns. 

If some customers are seeking out offshore operators primarily because they want to use cryptoassets, a safe and regulated domestic alternative could reduce part of that demand.

That said, it is unlikely to trigger a wholesale migration away from the black market. 

Offshore operators may continue to attract customers by offering speed, low friction and minimal checks. 

By contrast, licensed UK operators offering crypto would still be expected to undertake meaningful due diligence and consumer protection measures. That creates a regulatory balancing act: if the authorised route is too restrictive, customers looking for convenience may still choose unlicensed sites; if it is too permissive, the risks to consumers and the licensing objectives become harder to manage. 

The long-term challenge for regulators is therefore likely to be designing a regime that is both safe and commercially realistic.

What this means

The likely direction of travel is that cryptoassets will become easier to accommodate within the UK’s regulated economy, but not easier to use in gambling without significant controls. For operators, the key issue will be whether crypto can be embedded into existing financial crime and consumer protection frameworks in a way that satisfies the Commission as well as commercial expectations. For suppliers, the opportunity may lie in building products that combine payment functionality with strong compliance intelligence.

For the market as a whole, the real test will be whether regulation can create a route that is credible enough to compete with offshore offerings while still delivering the standards expected of the UK licensed sector.