With some delay, Brazil realized the potential for harm that online sports betting – the bets – can cause, especially in young men: addiction, debt, family problems and less money for education and food are some of the side effects.
Main sponsors of 15 of the 20 first division football teams, bets are omnipresent in Brazilians’ favorite sport and accessible from their cell phones, from the comfort of home. Legalized since 2018the government only announced its regulation in September, when the country was already behind only the United States and England in sector revenue, according to the analysis company Comscore.
But the dizzying growth of betting and its harmful effects on part of the population are not an exclusively Brazilian problem. Other countries have been registering a similar phenomenon and, at different paces, debating and adopting stricter rules. Recent research has also brought more clarity about its impact on the population’s financial and mental health.
United States, the largest market
As in Brazil, betting was legalized in the United States in 2018 – but, instead of a legislative change approved by Congress, in the case of the Americans the pivot of the change was a decision by the Supreme Court: the majority of ministers concluded that a standard 1992 federal law that prohibited sports betting went beyond the powers of the federal government, and guaranteed the states the right to regulate the issue.
Today betting is legal in 38 of the 50 states in the country. An estimate by the bank Goldman Sachs pointed out that, in October 2023 alone, Americans spent more than 1 billion dollars on online sports betting – and the projection is for the sector to continue growing until it reaches 45 billion dollars per year.
In addition to banks, bets have also caught the attention of researchers who have been looking into their effects on Americans’ finances. A study by Brett Hollenbeck, from the University of California at Los Angeles, and Poet Larsen and David Proserpio, from the University of Southern California, published in preprint in August and not yet peer-reviewed, concluded that in states that have legalized betting, Residents’ financial health worsened more than in states where they were still prohibited.
To reach this conclusion, the researchers consulted an anonymized financial database of around 7 million Americans, with information from 2004 to today, and compared the evolution of variables such as financial health, excessive debt and access to credit. The methodology included a check that ruled out the hypothesis that states that legalized betting did so due to budgetary problems, which could also influence the financial health of citizens.
The research found a statistically significant difference for the worse in credit scores, insolvency rates and debt collection in states that legalized betting, compared to others. The results also showed that, where online betting is legalized, the worsening was more pronounced among young men living in poorer municipalities.
Attentive to the evolution of the phenomenon, federal deputy Paul Tonko and senator Richard Blumenthal, both from the Democratic Party, presented a bill in September to establish, at the federal level, minimum standards for betting operations. Among the proposed measures is a ban on sponsoring college athletes and the use of credit cards to place bets.
Germany discusses advertising restrictions
In Germany, the legalization of online sports betting took place at the end of 2020 – and it is gaining ground. In 2022, they recorded revenue, already discounted for prize payments, of 1.4 billion euros – behind only traditional gaming machines in gastronomic establishments and salons (4.8 billion euros) and the lottery (4.1 billion of euros).
The data is in the report Gambling Atlas 2023, prepared by researchers from the Institute for Interdisciplinary Research on Addictions and Drugs in Hamburg (ISD), the German Center for Addiction Issues in Hamm (DHS) and the University of Bremen, funded by the Ministry of Health.
The research defines online sports betting as “the easiest type of gambling” and highlights its rapid growth. Meanwhile, the country is debating whether to ban betting advertising. In the 2022/2023 season, 17 of the 18 Bundesliga football teams received sponsorship from companies in the sector, according to the report.
Deputies from the Social Democratic Party (SPD) and the Green Party have been defending the ban on advertising, also supported by more than 70% of Germans, according to an opinion poll carried out in December 2021. The country currently has relatively liberal legislation on the theme, and allows bets to sponsor teams and broadcast advertising on billboards, on the internet and on television, conduct prohibited, for example, in Belgium and Italy.
In 2021, a survey identified that 8% of men living in Germany had placed sports bets, while only 2% of women. Men aged 21 to 35 and people with an immigration background are most affected by addiction. According to the report, among those who place live sports bets, 29.7% have some degree of addiction, with 6.1% being serious addiction.
Considering all types of legalized gambling, the government raised R$5.2 billion from the activity in 2021 – more than double that collected from the sale of alcoholic beverages. The report also estimated that there are 4.6 million adults addicted or at imminent risk of becoming addicted to gaming in Germany. Addicts – who number 1.3 million people – spend an average of R$800 per month on betting, and those at imminent risk of addiction, who are R$3.3 million, spend an average of R$206 per month.
The sector’s regulation includes a centralized database that registers people who are prevented from making bets online – the bettor himself, his family or companies can make requests for registration. At the end of 2023, there were more than 200 thousand people registered in this database, the majority on the initiative of the bettor himself, according to the newspaper The time.
In Argentina, fashion among young people
The country neighboring Brazil also deals with a similar problem. In Argentinaat least 17 provinces have rules that allow online betting, including Buenos Aires, since December 2018, according to the website Checked.
An online survey carried out from May to July this year by a network of universities, with 7,810 teenagers and young people aged 15 to 29, identified that 22% of them had already placed bets online in the past, and 16% continued to do so.
Among those who had already bet or were betting, 58.7% said they spent less than an hour a day on the activity, and 12.7% of them reported spending more than four hours a day placing bets online. In the same universe, 27.5% said that they had already felt anxiety or stress due to not being able to place an online bet, and 25% spent money intended for another purpose on bets.
Among teenagers and young men who had bet or were betting, the average monthly expenditure was equivalent to 120 reais and, among women, 61 reais.
The survey also received more than 4 thousand reports from interviewees. Some mentioned suffering bullying from colleagues for not having the “courage” to place bets online, knowing people who have stolen resources from family members to bet and others who have lost friends or who were caught at school due to requests to borrow money to support their bets. Among those who bet, there are reports of despair, bad mood and fits of rage related to the activity.
The adoption of stricter controls to access betting sites was supported by 41.8% of participants, and 71.7% would support a prevention campaign aimed at young people.
Professor Martín Romeo, director of the research, told the newspaper The Nation that low-middle-income teenagers and young people, living in homes slightly above the poverty line, bet on average three times more than the general sample average. Their hypothesis is that they seek to compensate for insufficient income from work through gambling. “It’s not that they gamble because they have nothing to do,” he says.
On October 8, a police operation in Buenos Aires dismantled an organization involved in illegal online betting, and blocked more than 1,800 unauthorized betting sites.
Restrictions in other countries
Research led by Repairer Etuk, from the University of Nevada (USA), published in September 2022 in Journal of Behavioral Addictionsreviewed 65 scientific articles on sports betting in 12 countries and identified that it is associated with a higher level of problematic behavior.
Among the countries evaluated, China and South Korea were those that adopted the strictest restrictions against betting in recent years. In China, the country experienced rapid growth in online betting between 2005 and 2014, until they were banned in 2015 – today, only some types of sports lottery controlled by the government are allowed. In South Korea, only one company has a license to offer sports betting in physical stores and online.
In the field of advertising, in August 2021 Spain restricted the broadcasting hours of advertisements about sports bets to the period from 1 am to 5 am, and banned the sponsorship of teams and tournaments in the country – in the first division, before the veto, 19 of the 20 clubs received sponsorship from betting sites. In the United Kingdom, betting companies will be banned from being main sponsors of Premier League clubs from the 2026/2027 season.
Young people with low income are more vulnerable
Several studies have already shown that young people and people with lower incomes are more vulnerable to the adverse effects of betting on their financial health. Psychiatrist Nicole Rezende, collaborator of the Integrated Outpatient Program for Impulse Disorders at the Institute of Psychiatry at USP (Pro-Amiti), tells DW This occurs due to several factors.
Surveys show that young and low-income people are directly affected by the ‘epidemic’ – Photo: Mauro Pimentel / AFP
“It’s like a puzzle. More emotionally vulnerable people, with a history of trauma or mental health problems, can use gaming as a way to obtain pleasure. And if there is already a vulnerability to substance use, the chance of developing into compulsive behavior is greater”, he says.
She points out that access to betting, especially for teenagers, was widely advertised via social networks with the idea that “it would be a possibility to increase income, a quick solution to financial difficulties”. In this scenario, needy young people, without parental supervision or a support network, are more exposed.
“Young people with less education may have the belief that this will solve their lives. Unlike individuals who are already more stable, with some financial security, employed or attending college, with more repertoire”, he says.
The fact that betting is available on mobile enhances the addictive potential: “The more accessible and normalized a behavior is within a culture, the more comfortable the individual is to initiate and engage. And, most of the time, no one is checking what the person is doing on their cell phone.”
