Brazil’s Regulation Crisis Raises Questions for Latin America’s iGaming Market

Brazil’s regulation faces a political and social challenge

Brazil’s transition from an unregulated environment to a regulated betting market has taken a difficult turn. During the discussion, the speakers stressed that the current situation should not be interpreted as proof that regulation itself has failed. Instead, they pointed to political decisions, public perceptions and the continued presence of illegal operators as central factors behind the crisis.

From legislation to regulatory implementation

Bárbara Teles, Head of Compliance at Playtech and a Brazilian lawyer, explained that although gambling legislation was approved in 2018, the regulatory framework only began to take shape in 2024, with implementation starting in 2025.

The country subsequently introduced more than 20 ordinances covering areas such as anti-money laundering, responsible gaming, payment methods and technical requirements. According to Teles, the regulation established a comprehensive set of obligations for licensed operators.

She argued that the current difficulties cannot simply be attributed to a lack of rules or insufficient efforts to protect the market. Rather, the industry has struggled to change the way gambling is perceived by society.

“Even if we were trying to do our best as operators, we were trying to do our best as associations, we didn't change the social knowledge about the industry,” she said.

Public perception and the political debate

Teles also noted that public criticism of gambling has increasingly influenced the political debate. In her view, the industry did not have enough time or resources to explain its role and demonstrate the safeguards introduced through regulation.

The discussion highlighted a broader challenge for emerging regulated markets: establishing a legal framework is only one part of the process. Public understanding, effective enforcement and sustained political support are also essential to the long-term stability of regulation.

Job losses highlight the impact of regulatory uncertainty

The consequences of Brazil’s situation are already being felt across the industry, particularly by employees and companies that had invested in the market.

Operators and employees face immediate consequences

Victor Santiago Torvão, Head of Casino at Pixbet, described the immediate impact on his company and its operations. He said a large office in Serra Branca, Paraíba, had been closed and that approximately 300 employees had been dismissed.

“It's a real nightmare,” Torvão said, describing the effects on employees, suppliers, marketing teams and other professionals connected to the business.

He explained that the company remained in contact with former employees and hoped to rehire people if the situation changed. However, rebuilding operations would depend on greater certainty from the government and confidence that the market could operate again under stable conditions.

The wider iGaming ecosystem is affected

The impact extends beyond operators. Affiliates, technology providers, marketing agencies and other businesses supporting the betting ecosystem are also exposed to the consequences of regulatory uncertainty.

The panelists rejected the idea that the current crisis should be treated as an opportunity to criticize those who had invested in Brazil. Instead, they called for greater cooperation across the international iGaming industry to support affected professionals and businesses.

Filippo Anzalone, GTM Strategy & Growth Lead at iGaming InteractiveAI, also highlighted the importance of helping displaced workers find new opportunities. He pointed to industry professionals sharing vacancies and recommending former colleagues through LinkedIn and WhatsApp groups.

Although this support cannot replace lost jobs, he said, it demonstrates the value of cooperation during a period of uncertainty.

Can Brazil sustain a sports betting-only market?

Another issue raised during the forum was whether a market focused exclusively on sports betting could remain commercially viable under the current circumstances.

Regulatory certainty and business sustainability

The speakers discussed the difficulties companies face when they cannot operate with the degree of certainty required to plan investments, retain teams and develop their products. The absence of a predictable regulatory environment also makes it harder for businesses to assess future risks.

“Only for sports book is super hard,” was one of the points raised during the discussion, reflecting concerns about the sustainability of a market with limited operating possibilities.

The panel also emphasized the difference between licensed businesses and illegal operators. While regulated companies are expected to comply with requirements covering areas such as responsible gaming, identity verification and payments, illegal platforms may continue operating outside the same controls.

This creates a challenge for regulation: restrictions affecting legal operators do not necessarily eliminate the demand for gambling or prevent unlicensed businesses from reaching players.

The speakers argued that a regulatory framework must be accompanied by effective enforcement against illegal activity. Otherwise, the consequences may fall disproportionately on companies that have invested in compliance while unauthorized operators continue to reach consumers.

Illegal operators and player protection remain central concerns

The relationship between regulation and player protection was one of the strongest themes of the conversation.

Regulation versus prohibition

Teles argued that prohibiting gambling does not automatically resolve the social concerns associated with the sector. In her view, a regulated market offers a framework through which authorities can establish requirements, monitor operators and hold licensed businesses accountable.

“Prohibiting is not the way of protecting people,” she said.

Torvão also questioned the effectiveness of restrictions when illegal brands can continue advertising through social media platforms. He described seeing promotional content from unauthorized operators on Instagram, Facebook and YouTube, despite the measures affecting legal businesses.

For the panelists, this highlights the importance of distinguishing between the suspension or restriction of licensed activity and the actual elimination of illegal gambling.

The industry's image and responsible gaming

The discussion also touched on the industry's public image. Anzalone observed that working in gambling can still carry a social stigma, even when professionals are employed by companies operating within a legal framework.

“One word that describes our industry, unfortunately, is the word shady,” he said, referring to the perception that the sector continues to face.

The speakers suggested that industry associations, operators and other stakeholders need to communicate more effectively about regulation, technology, taxation, employment and responsible gaming. Improving public understanding, they argued, is part of building a more sustainable regulatory environment.

Legal challenges could shape the market’s next steps

Despite the uncertainty, the panelists discussed potential legal and legislative developments that could influence Brazil’s next steps.

The provisional measure and the legislative timeline

Teles outlined the timeline associated with the provisional measure then in force. She explained that the measure had an initial period of 60 days, with the possibility of a further 60-day extension. She also noted that the legislative recess could affect the timetable.

Based on the framework discussed during the session, the measure could reach a critical point around March if it were not voted on earlier. However, she stressed that this was a possible timeline rather than a guaranteed date for the market to reopen.

If Congress votes on the measure and changes its text, the proposal could return to the executive branch before becoming law. The legislative process therefore remained an important source of uncertainty.

The Supreme Federal Court hearing

The speakers also pointed to a public hearing at Brazil’s Supreme Federal Court scheduled for November 3. According to Teles, developments following the hearing could lead to a decision by the reporting minister or a matter being considered by the full court.

These legal proceedings were presented as possible avenues for change, not as confirmation that restrictions would be overturned. The outcome and timing remained uncertain, leaving operators and employees waiting for greater clarity.

For the industry, the distinction is significant: the future of regulation will depend not only on the formal rules already established, but also on how political and judicial decisions affect their implementation.

Brazil’s position as a Latin American iGaming hub

The situation also raises questions about Brazil’s role in the wider Latin American market.

Regional investment and market confidence

The country had attracted significant attention from international operators, suppliers and service providers seeking to enter a major market with a formal regulatory framework. The current uncertainty has challenged that outlook and prompted businesses to reconsider their plans.

“On a short term, Brazil lost it, the label of a gaming hub in Latam,” was one assessment shared during the discussion.

However, the panel did not present the current crisis as the end of Brazil’s potential. Instead, the speakers emphasized that the country’s long-term position will depend on whether it can restore legal certainty and maintain a workable framework for licensed businesses.

Lessons for regulation across Latin America

The debate also offered a broader lesson for other Latin American jurisdictions considering or developing their own regulation. A formal legal framework is important, but it must be supported by consistent implementation, effective action against illegal operators and public communication that explains the purpose of regulatory safeguards.

For companies assessing opportunities across the region, predictability remains a key consideration. Changes in policy, uncertainty over enforcement and difficulties in distinguishing legal from illegal activity can all influence investment decisions.

Industry unity remains a priority

In their closing remarks, the speakers returned to the importance of cooperation and the need to rebuild the sector’s relationship with society and government.

Supporting workers and strengthening the industry

Anzalone praised the efforts of industry professionals to help colleagues affected by job losses, while Torvão stressed the need for decisions that recognize the difference between legal businesses and unauthorized operators.

Teles reiterated her confidence in the regulated market and called for the industry to remain united while the legal and political situation develops. She argued that licensed operators contribute through taxation, sponsorships, employment and technological innovation, and that these elements should form part of the public debate.

Her message was clear: the response to social concerns should focus on effective safeguards and accountability rather than assuming that prohibition alone will solve the problem.

The discussion concluded with a shared hope that Brazil could return to a stable operating environment. For the panelists, restoring confidence will require more than a change in the immediate restrictions. It will also require a credible regulatory framework, stronger enforcement against illegal operators and a sustained effort to improve the industry's public image.

As Teles put it, the industry can come back stronger if stakeholders work together and ensure that operators function legally under regulation that is consistently applied.

Watch the full discussion on LinkedIn Live.