Regulation or revenue? Asia's gaming industry faces a defining choice
As Asia moves forward with its rapidly growing gaming industry, operators, investors, and regulators face an important question: is it worth pursuing aggressive growth, or do we need to develop stronger regulations and establish a credible reputation to succeed in the long term?
That question took centre stage during the debate session, “Asia’s Safest Bet: Regulation or Revenue?”, held on the SiGMA Stage at the SiGMA Asia 2026 Summit on 3 June at the SMX Convention Centre in Manila. Moderated by SiGMA Group’s Asia Lead Senior Journalist Jenny Ortiz-Bolivar, the discussion featured Steve Tsao, General Partner at Yolo Investments, and Ray Lee, Director of Business Development at TaDa Gaming.
The debate explored the tension between aggressive market expansion and regulation-led growth, examining how operators can balance profitability with sustainability in one of the world’s most diverse gaming landscapes.
The race for growth
Operators across Asia are finding gaming investment opportunities that allow them to tap into an emerging market with a rapidly increasing number of gamers who have embraced the digital world. There is no doubt that consumer demand for gaming will continue to increase in Asia over the next five years.
However, the consensus among attendees is that rapid growth often brings substantial risk.
For many gaming operators, entry into emerging markets can yield large, short-term earnings; however, entering these jurisdictions carries risks due to their generally ambiguous or continuously evolving regulatory frameworks. On the one hand, these jurisdictions typically have lower barriers to entry; on the other, they also present increased political and operational uncertainty for businesses.
As part of the discussion, it became clear that many operators place a greater emphasis on generating revenue than on developing a plan that meets the regulatory requirements before entering a newly regulated jurisdiction. Therefore, when a newly formed government imposes increased oversight and a new compliance regime, it can create challenges for operators who took shortcuts or took advantage of the expanded market without a comprehensive plan in place.
The panellists noted that today’s gaming companies face a much more complex environment than they did a decade ago. Regulators across Asia are becoming increasingly sophisticated, while consumers, investors and payment providers are demanding higher standards of transparency and accountability.
Regulation as a competitive advantage
One of the central themes of the debate was whether regulation should be viewed as a cost or as a strategic asset.
Rather than treating compliance as an obstacle to growth, the speakers argued that strong regulatory foundations can create lasting competitive advantages. Licensed operators often gain easier access to banking services, institutional capital and strategic partnerships that may not be available to businesses operating in regulatory grey areas.
The discussion also explored the growing importance of trust.
As gaming markets mature, player confidence becomes an increasingly valuable commodity. Consumers are more likely to engage with brands that demonstrate responsible gaming practices, robust security measures and regulatory compliance.
The panellists suggested that operators who invest early in compliance frameworks are often better positioned to withstand market disruptions and policy changes. While regulation may initially slow expansion, it can create a more stable platform for sustainable growth over the long term.
The offshore dilemma
The debate also examined the role of offshore gaming models, which continue to generate significant discussion across Asia.
Offshore operations have historically allowed companies to access markets where domestic licensing frameworks were unavailable or underdeveloped. However, governments throughout the region are increasingly scrutinising such models as they seek greater oversight, tax revenues and consumer protection.
Several participants commented on the developing views towards offshore operators. The last several years have seen continued flexibility and speed to market, but they may also introduce additional risk and uncertainty for investors and stakeholders who want clearly defined regulations.
The speakers indicated that when considering going offshore, operators should determine whether the potential benefits outweigh any reputational or legal compliance risks.
Finding the balance
Many viewpoints were shared in the debate, all of which emphasised the same basic point – that revenue and regulation are not necessarily opposing goals.
Gaming operators throughout Asia are increasingly under pressure to demonstrate that they can be profitable while following responsible business practices as the industry evolves.
The debate highlighted that the entities that will ultimately dominate Asia’s gaming market may not be those that grow the fastest, but rather those that can develop sustainable businesses capable of thriving amid regulatory change and market volatility.
As governments continue to develop new regulations for the gaming industry across Asia, the conversation regarding regulation versus revenue will likely continue for an extended period. It will become one of the dominant strategic considerations for gaming operators over the next decade.
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