In an exclusive interview with Yogonet, Fast OffShore founding partner Ron Mendelson, expert consultant for the iGaming industry, shared a global evaluation of the industry’s recovery from the pandemic and how it boosted iGaming as people adopted more digital habits. He provided a global overview and explained in more detail the various advances that the industry has experienced in general as new markets are regulated. Finally, he shared the company’s expectations for 2022 as well as the main issues on the agenda for the coming year, and how the metaverse can revolutionize the online gaming industry.
What would your end-of-year assessment be for the iGaming industry, particularly with regard to the gradual recovery from the pandemic, emerging / booming markets and use of technology, and other critical developments in the different sectors of activity and verticals?
As we come to the end of the year, we can really appreciate how exceptional 12 months have been. After the uncertainty and unpredictability of 2020, this year has been a little easier. Growth continued on an upward trajectory, and people have gotten used to a more digital way of doing things.
By the end of 2021, the global online gambling market is expected to exceed $ 74 billion, growth at a rate of 11.4% go forward. If this continues, we Expect it to hit $ 158.20 billion over the next six years. At the same time, we have seen a decline in interest in land-based casinos and gambling. Many haven’t reopened after 2020, and those who have noted players’ new preference for online gaming. Fortunately, the iGaming sector was not too impacted by the pandemic and operators quickly adapted. This creates a good priority.
During this year we have also seen several legal developments. Malta fell on the FATF gray list and streamlined its application process in terms of key function roles. We saw the UK tighten the rules around payments and time slots, signaling more to come in the future. This approach has been replicated in other jurisdictions as responsible and fair gambling has become a priority.
Globally, compliance was a topic of discussion in 2021, and the need to protect clients and comply with AML / CFT obligations will increase. After all, as more and more people log on and start playing, the temptation to abuse and criminality will increase. Therefore, it is up to regulators and operators to ensure the best and most secure experience possible.
Some new regions have opened up over the past year. Governments in The Netherlands and Germany issued their first licenses, and Ireland has taken steps to create new laws to regulate iGaming.
We have also seen several strategic mergers and acquisitions. For example, Esports Entertainment Group has acquired Bethard to expand into the Spanish and Swedish markets.
In terms of emerging regions, we noted a slight increase in requests for licenses covering players from Latin America. Interest of pique operators as more and more countries in the region move towards legalizing online gambling and even issuing their licenses. A largely untapped market fond of land-based gambling, this is an area to watch and consider next year.
APAC remained solid, particularly in the Asian segment, with more growth in eSports, online betting and slots and a strong demand for the integration of innovative technologies. Europe stay fixed with moderate growth as more and more countries allow online gambling and issue their own licenses.
Technology has become a focal point among our customers in 2021. We have responded to inquiries about blockchain systems in gambling and blockchain-based algorithms with proven fairness. ESports have continued to enjoy widespread interest and have been adopted by several online betting operators. There is also a renewed interest in fantasy sports in the sports betting sector.
In addition, AI was a technology of interest, and many of our customers have started using it for issues like onboarding, compliance, and monitoring player behavior. The iGaming industry has taken a step forward in terms of technology and quality, including VR and AR in their portfolios.
In all, 2021 has been an exceptional year, and it gives us great hopes for what lies ahead in 2022!
Based on customer feedback and research, what are your prospects, your expectations for 2022? What do you think will be the new challenges and trends in the iGaming industry? What will be the main questions guiding the agenda?
We expect 2022 to be even bigger and better than 2021. We are incredibly excited about what the next 12 months will bring in this climate of changing technology and continued growth. There are a few things that should pop up next year.
First, the metaverse (web 3.0) has been something that industry insiders have been concerned about for some time. For those who don’t know, the metaverse is a 3D version of the Internet made up of several virtual environments. It is accessible via computer or mobile, but also with VR and AR headsets and compatible devices. A few years ago this kind of tech would have seemed like it came out of a sci-fi movie, but here we are at the end of 2021, talk about how he’s going to revolutionize gaming in 2022!
We have no doubt that the metaverse will forever change the online gaming industry. Some companies are already working on the integration of the casino and betting in the metaverse, which will allow users and their avatars to play while exploring. While the kit needed to access the Metaverse (headsets and a powerful PC) is still quite expensive, these costs are likely to decrease as demand increases.
Regarding the gambling sector on a practical and regulatory level, we expect big news from Curacao in the coming months. Without saying too much things will change, but we’ll be sure to update you with all the information as soon as that happens. As mentioned above, wWe expect to see regulation take center stage, focusing on responsible gambling, fairness and compliance in the fight against money laundering and the financing of terrorism. Fast offshore has always pushed for compliance, recognizing that non-compliance ultimately leads to over-regulation, which puts the industry at risk for all of us.
Other hot topics for the next 12 months include the continued growth of eSports. We may have been saying this since the start of the pandemic, but we cannot overstate the size of this sector and the still untapped potential. When we look at the size and growth rate of the gaming industry, streaming industry, and digital entertainment demand, and then combine that with the growth of gaming, you can get a good idea. We look forward to seeing more investments and mergers in esports, as well as high-profile funding from big names in venture capital. This will trickle down to other types of gambling companies as well, including fantasy sports, casinos and betting, as the big names seek strategic investments to increase their reach and expand their portfolios.
Live dealer games should also be considered as players continue to seek social aspects in their gambling activities.. This, combined with streaming and metaverse, creates plenty of opportunities for iGaming entrepreneurs who are ready to embrace technological innovation. Finally, on the game side, it is likely that the graphics of the game will undergo an overhaul in the near future. As our devices perform better and the graphics quality of other types of games reaches new heights, the gambling industry knows it needs to catch up.
In terms of regions, we will closely monitor what is happening in Latin America and Ireland, as well as continental Europe. 2022 could also be the year when Malta gets rid of its unfortunate gray list. We also expect to see continued interest in Kahnawake as a leading jurisdiction for online gaming licensing.
As for the value of the sector, it is expected to surpass the staggering $ 80 billion figure by the same time next year. This will be driven by all of the exciting new verticals and segments that we have mentioned. Also, increased access to high-speed internet, smartphones and a decline in interest in land-based casinos. More and more gamers will turn to the digital realm for entertainment purposes in 2022.
As for Fast Offshore, we will continue our work, assisting and guiding startups, entrepreneurs and existing businesses in their gaming efforts. We stand ready to provide our portfolio of services, including incorporation, Licence, Payments, compliance and, of course, administration continues. As always, we will do all of this with transparency, accountability and a healthy dose of professionalism.