Betting in the electoral crosshairs: between easy rhetoric and the risk of throwing away regulation along with the "grey market"
Betting companies have become a central theme in the campaigns for the São Paulo state government and the presidency of the Republic. The explanation is not only ideological: opinion polls show a largely hostile electorate towards the sector. Latam Pulse Brasil, by AtlasIntel, indicates that the vast majority of Brazilians see online betting as harmful to society, and more than half see "only losses" in it. A survey by More in Common with Ipsos-Ipec reinforces this picture: about a quarter of respondents say they would vote more willingly for candidates who advocate restricting betting.
According to a report by Estadão, 86,7% of Brazilians view betting as harmful; this pushes all pre-candidates towards speeches of restriction or total prohibition, with little room for technical nuance.
Given this scenario, the presidential race and the dispute in São Paulo began to revolve around who "created" the problem and who promises to solve it more harshly. Lula escalated his rhetoric against betting companies; Tarcísio de Freitas attributed the growth of betting to the regulations approved during Lula's government (by Fernando Haddad, then Minister of Finance); Haddad shifted the responsibility to the Bolsonaro government, which he claimed was negligent while the problem grew. Romeu Zema promises to end betting as his first act in office; Renan Santos followed the same line, publicly associating companies in the sector with money laundering; Ronaldo Caiado speaks of a "heavy hand" without advocating a total ban; Flávio Bolsonaro avoids the topic directly, but his campaign signals a review of the regulations.
The blind spot in the discourse: prohibiting is not the same as solving.
The report opens up space for the argument that supports the defense of the regulated market: the most radical proposals for a total ban almost always appear without any explanation of practical viability or side effects — which leads the betting market itself to classify them as populist.
The technical counter-argument is well-known, but it's worth reiterating: there is a consolidated demand for betting in Brazil, and a ban doesn't eliminate that demand—it pushes it into the illegal market, which operates without any control, without tax collection, and without the safeguards that regulation attempted to establish. In 2025, the first year of the regulated market, government revenue from the sector was around R$ 9 billion—a resource that disappears if the model is simply wiped off the map in the name of a political gesture.
A potential ban does not eliminate demand, it only transfers it to the illegal market — without revenue, without control, without protection for the bettor.
Economist Lauro Gonzalez, from FGV, offers a useful perspective to understand why betting has become so prominent in the electoral agenda: it functions as a symbolic explanation for the mismatch between positive macroeconomic indicators (rising income, low unemployment) and the persistent dissatisfaction of the population. Betting and over-indebtedness, in his view, "throw sand" on the positive data—which is different from saying that the regulatory model itself is the problem.
Shadow Game: an operation against the past, not against regulation.
Operation Shadow Game, launched against two of the sector's best-known brands, is the most sensitive point for those who defend the regulated market, because it is also the easiest to distort politically.
The essential detail, highlighted by the Federal Revenue Service itself in the press conference about the operation, is the time frame: the suspicions of currency evasion, tax evasion, and money laundering target the period between 2018 and 2024 — before the regulation came into effect in January 2025. During those years, the betting companies operated in a legal limbo created by the 2018 law (sanctioned by Michel Temer) and never regulated in time by the Bolsonaro government. Without a clear tax headquarters in Brazil, without effective oversight, and without taxation rules, what the report calls a "gray market" flourished.
In other words: the operation does not prove that regulation failed — it exposes the cost of years without any regulation. It is precisely this period of vacuum that the Lula government is trying to capitalize on politically as a "cursed legacy" left by Bolsonaro, while at the same time trying to shield itself from the accusation of being the "father" of gambling.
But this official narrative also has weaknesses that deserve editorial attention: within the Lula government's own regulations, licenses have already been granted to companies linked to illegal gambling and to companies that operated illegally before authorization; the Ministry of Finance's inspection team is lean; and the fines applied so far are insignificant compared to the sector's revenue.
The real risk: confusing the 6 years of vacuum with the 18 months of regulation.
The biggest risk highlighted — albeit indirectly — by the three Estadão reports is that of generalization. Of the 85 companies authorized to operate 188 websites today, a large portion have a history of activity during the "gray market" period, many with simultaneous operations inside and outside Brazil. This fuels the fear, already felt by the legal market, that new police operations targeting the past will be publicly interpreted as proof that current regulation has failed — when in fact they are investigating exactly the opposite: conduct prior to its enactment.
This is the core of the argument to be reinforced: separating the diagnosis (indebtedness, public health, financial crimes linked to the period without rules) from the solution advocated by the regulated market (more oversight, more transparency, effective enforcement of current law) prevents the electoral debate — driven by opinion polls and the narrative dispute between Lula and the opposition — from throwing away, along with the dirty water of the gray market, the very model that attempted to bring order to that market.
