According to Blask’s latest analysis of the U.S. iGaming landscape, 290 out of 362 operators active in the American online gambling ecosystem (approximately 80%) are offshore platforms operating outside domestic regulatory frameworks. The data highlights a structural reality of the U.S. market: while regulation has expanded significantly over the past decade, offshore operators still dominate the competitive landscape in terms of brand presence.

This dominance is not limited to the number of operators. It also translates into a substantial share of total market value. Blask estimates that the total U.S. online gambling market reached approximately $79.8B in Competitive Earning Baseline (CEB) in 2025. Of that total, only around $25.2B was captured by licensed domestic operators, while the majority flowed to offshore platforms.

In other words, roughly three quarters of the U.S. market value remains outside the regulated ecosystem, despite more than a decade of state-by-state legalization.

The persistence of offshore dominance is closely tied to the fragmented structure of U.S. gambling regulation. Several of the country’s largest markets still operate without any online gambling legalization, while many regulated states allow sports betting but not online casinos — creating structural gaps that offshore platforms continue to fill.

States that offer full online gambling regulation, including both sports betting and casino, show significantly lower offshore penetration. Markets such as New Jersey and Michigan capture roughly three quarters of their online gambling value domestically, demonstrating that comprehensive regulation can meaningfully increase channelization. However, no U.S. jurisdiction has fully eliminated offshore activity.

Legalization in the United States does not eliminate offshore gambling activity but dramatically reduces it. According to Blask’s 2025 U.S. iGaming landscape analysis, fully regulated states offering both online casino and sports betting see offshore market share drop to approximately 38% on average.

By contrast, betting-only states average around 74% offshore share, while unregulated states send 100% of their online gambling value offshore by definition. The data suggests a clear structural pattern: regulation significantly improves channelization — but it is not a binary switch.

National context: 77% offshore

Across all analyzed U.S. states, the national average offshore share stands at 79%, compared to 21% domestic. Even after more than a decade of state-level legalization, offshore platforms still capture the majority of U.S. online gambling value.

However, the distribution varies dramatically depending on the regulatory model.

Fully regulated states: majority domestic

States that have legalized both online casino and sports betting show the strongest domestic capture rates.

• New Jersey captures approximately 73% of its market domestically.
• Michigan captures roughly 75% domestically.
• Across fully regulated states, domestic share averages near 62%.

These markets demonstrate that when players have access to a full licensed product suite — including casino — a majority of value can be retained within the regulated ecosystem.

Betting-only states: structurally capped

The picture changes sharply in states that have legalized sports betting but not online casino.In these jurisdictions, offshore share averages around 74%. Examples illustrate the structural limitation:

• New York, the largest state market by CEB, sees roughly 61% of its value flow offshore.
  Ohio shows an even more extreme split, with 82% of market value offshore.

In both cases, the absence of regulated online casinos pushes players seeking slots and table games toward unlicensed platforms. The data indicates that sports betting alone does not meaningfully channelize broader gambling demand.

Time matters

Even within fully regulated states, maturity plays a role. Rhode Island, one of the newest regulated markets, remains below the tipping point, with offshore share exceeding domestic. This suggests that channelization improves over time as licensed brands build product depth, customer trust, and brand equity.

Regulation sets the foundation — but market capture is gradual.

Regulation as a spectrum, not a switch

The U.S. model demonstrates that legalization reduces offshore participation substantially therefore cutting it by more than half in fully regulated environments compared to national averages. However, no U.S. state has fully eliminated offshore activity. For policymakers, the takeaway is pragmatic rather than ideological: full-spectrum regulation meaningfully shifts economic value onshore, but expectations of total elimination are unrealistic.

The debate is therefore no longer whether offshore exists, but how much of it can be practically reduced through comprehensive regulation.