Credibility push brings trade-offs for small gaming jurisdictions
As newer licensing hubs try to shake off the stigma attached to offshore regulation, one industry adviser says the real test is not marketing but whether regulators can show they understand the business, enforce their rules and plan for the long term. For years, smaller gaming jurisdictions have had a simple problem: they could attract business quickly, but not always respectability.
Now, as some seek to reposition themselves as serious regulatory centres, the pitch is changing. The promise is no longer light-touch oversight or easy market entry, but tighter checks, clearer rules and a cleaner reputation.
Gilad Oren, a corporate services adviser and CEO of GBO, who works with gaming companies and regulators, argues that the shift becomes credible only when it shows up in the details.
“If I see a regulator starting to ask focused questions that show they understand the business, that is a very good sign that the regulation is progressing,” he told SiGMA News.
Oren, who said he has spent 17 years in iGaming and helps launch hundreds of new iGaming businesses, described a market in which perception can rise or fall quickly. In his telling, the strongest signal is not the rhetoric of reform but whether a regulator becomes more demanding in a coherent way.
That means deeper due diligence, more scrutiny of ownership and funding, and a more serious approach to complaints. One sign of that, he said, is the use of ADR (alternative dispute resolution), an independent process used to settle complaints without going to court. “How a regulator handles complaints shows its maturity,” he said. “Many are now moving to ADR, which is great. But I still want to see that the regulator is proactive in this area.”
That, he suggested, is the difference between a jurisdiction trying to build a lasting business and one simply trying to attract a burst of registrations.
The cost of being taken seriously
For smaller jurisdictions, tightening standards can come with a short-term trade-off. Stricter entry requirements may deter the operators most likely to apply when oversight is weak.
But Oren said that was precisely the point.
“They do not want shady operators,” he said, referring to one newer jurisdiction he advised. “Why? Because with shady operators, you very quickly start to see more complaints, and that damages the regulator’s reputation.”
In a sector where payment providers, banks and software suppliers all watch licensing quality closely, the damage can spread well beyond a single operator. A weak reputation can make a licence harder to use and a jurisdiction harder to sell.
For Oren, long-term credibility is a commercial asset in its own right. “Banks will not accept it,” he said, referring to a licence from a regulator that has lost market trust. “In the long run, it causes a huge mess.”
That logic, he said, is pushing some governments to think far beyond the next licensing cycle. Speaking about Nevis, the Caribbean island that has emerged as a new iGaming jurisdiction, Oren said the ambition was to build “a proper gaming hub” over decades rather than cash in quickly.
“In Nevis, for example, they are planning 20 years ahead to build a proper gaming hub, a real gaming hub,” he said.
He pointed to what he described as modern legislation, government backing and investment in licensing technology, including a portal designed to reduce paperwork and speed up communication between applicants and compliance staff.
“The gaming ordinance was designed with the future in mind,” he said. “It is clear, easy to understand and built for a new generation of operators.”
Enforcement is what matters
Yet tougher rules on paper do not, by themselves, settle the question. Offshore regulation has long been dogged by suspicion that formal conditions may not be matched by meaningful enforcement.
Oren, however, insisted the risk for operators was real. If a company breaches the terms of its licence, he said, the consequences can be immediate and severe.
He described a chain reaction: payment providers pulling away, banks refusing to work with the business, software companies stepping back and reputational damage spreading through the market. “It’s like a snowball,” he said.
That is why, in his view, regulation is no longer optional window dressing for the industry, but part of its survival.
“For everyone involved in the iGaming industry, it is better if the sector becomes more mature and more regulated,” he said. “For players too, it means fewer scams and less fraud. It is better in every way, really.”
Even so, he warned that not every new regulatory ambition is equally convincing. On prediction markets, a fast-growing area drawing interest from gaming groups and policymakers, Oren was notably cautious.
“Prediction markets are a very complex thing,” he said. “It is easy to say you regulate them, but in practice, you are still a long way from actually doing it.”
That scepticism speaks to a broader point. In a crowded global market, smaller jurisdictions may be tempted to move early into emerging sectors in search of an edge. Gibraltar has already taken a concrete step, licensing its first prediction markets operator. Anjouan, meanwhile, is positioning itself as a licensing hub for prediction markets, hoping an early move will help it stand out.
However, early announcements alone are unlikely to carry much weight if they are not matched by the expertise, infrastructure and enforcement needed to support them, explained Oren.
For those trying to rebuild their standing, the challenge is straightforward, if not easy: show that the rules are real, show they are enforced and show the plan extends beyond the next burst of licensing revenue.
In the iGaming world, that may be the difference between a jurisdiction that lasts and one that does not.
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