What’s your evaluation of BiS SiGMA South America 2026 in terms of the business opportunities, the offer of solutions, and the state of the Brazilian market in general?
We’re seeing the increase of licensing, a refinement of the existing rules, advertising requirements, responsible gambling, and money laundering. The market is maturing and I think that was represented at the event. At the same time, President Lula recently announced that “the betting market is an absolute tragedy.” He used the word “tragedy” in Brazil and that he is looking to ban this industry. So it feels very counterintuitive that after it’s come so far over the last two and a half years, that suddenly the narrative is changing to this. I think that politics need to recognize how the gaming industry can be enhanced rather than being banned. Because by banning it, you’re taking it back to an illegal landscape, which was three years ago, where people were likely being exploited by illicit operators. At the same time, the regulation and the licensing requirements are very heavily focused on the operators who want to play by the rules, who want to do the right thing, because the majority of revenue in Brazil comes from the gray market, from the unregulated market. It’s almost like a lot of the well-meaning operators are being punished by wanting to do things the correct way. There are so many alternatives, whether it’s education, whether it’s enhanced responsible gambling, whether it’s banning illicit operators, and technology provides so many solutions, which I think the government doesn’t recognize, much less an 80-year-old president.
Sumsub is working with licensed operators in Latin America. What are the solutions you’re offering currently to those companies to avoid the dangers of digital attacks?
From Sumsub’s perspective, we aim to deliver invisible compliance, which means that only the bad-meaning players, only the ones with bad intentions, really see it’s there. It’s aimed to be as fluid and as seamless for the good-meaning players as possible, so that you reduce friction. We work with operators to make sure that they’re only letting players onto their site who aren’t going to abuse bonuses, commit friendly fraud or cashback fraud, or create bonus rings. If you look at the practices that are being required as part of licenses in Brazil, they’re still kind of stuck in 2016. You have the basic timeouts, you have deposit limits, you have cooldown periods, you have status checks, but nothing’s happening at a player behavioral level, at a data level, at a transaction monitoring level, at a platform event level. It would be very easy to identify the users chasing their losses, but instead I think a lot of regulation requires users to almost self-regulate and raise those issues themselves if they have gambling problems. In terms of Sumsub, there are lots of data, and lots of technical solutions like ours that can solve these problems, but regulators should be aware of them.
In order for those solutions to be aware by the public, by the operators as well, you have to educate. Education is key in Brazil and the whole Latin America continent, and your company specifically produces different content to educate the industry. How would you explain this philosophy of sharing knowledge?
It’s a question of making sure users understand the difference between a regulated operator and an unregulated operator, because with a regulated operator you know what you get. There are rules in place, there are protections in place. With unregulated operators, you have a whole range. There are some who try to do the right thing because they have some morality about them. There are others who are solely built for the purpose of laundering money, and if you create an account you are going to be collateral damaged. There’s a huge range there. I think what’s important is making sure that users understand what their rights are, and the thing that if they deposit on an unregulated operator, they might not get their money back. One thing that we see in trusted celebrities such as influencer MrBeast, advertising what they claim to be their casinos, that are almost charitable ventures, where they give money away every day, which is consistent with MrBeast’s reputation for example. People don’t realize that these are deepfake videos, totally fraudulent. The goal is to raise awareness within the gambling community, within users who aren’t as familiar with the industry as we are, about the value of playing on a regulated casino, and also raising awareness within the government of the risks of banning an entire industry, especially in Brazil, where the crypto adoption rate I think is the 14th in the world.
Just in a couple of months, all the world’s eyes will be focused on the World Cup, and that will presumably mean an increase in the number of players registering, growth in the volume of betting, and in revenues for operators. There are also risks, of course. How can your company help operators prevent fraud, differentiate honest players from those who want to take advantage of or damage the platforms.
We can help in ensuring that companies aren’t solving problems that they could have prevented in advance, so by working with us now, I think we can set up the ecosystem in such a way that they’re prepared for an increase in volumes around the time of the World Cup. Sumsub works on a global scale. We specialize in South America as well, we understand every market, we have presence in Colombia, Peru, Mexico, Brazil, and Argentina. It’s a question of ensuring that your platform has the capacity, the ability and the resources to handle a large influx of players around the World Cup. Of course, there are lots of uncertainties: you don’t necessarily know how far any particular team is going to go, what the betting trends are going to be, how prediction markets might affect this. There are so many variables. What we have is a platform that manages all of that, the large influx of traffic, and allows you to dynamically and adaptively KYC and verify users based on a number of factors and based on your risk appetite as well.
Considering everything you have shared in this interview, are you optimistic about the future of the iGaming sector in Latin America, in terms of governments, economic situation, and operators being able to use those tools and to help players?
I am, but I think operators are downstream while regulators are upstream, and there are floodgates. Some operators strictly follow requirements, want to do the right thing, and genuinely care about players’ well-being, while others are more revenue driven, and try to optimize their numbers. At the regulatory level, once rules are put in place, and once the regulator understands what the risks are, what can be solved through technology, then they can start imposing the laws so that all the operators have to play by the same rules. Am I optimistic in general? Yes, I think so, and I believe that we’re moving into an era of trust, where especially younger generations are much more focused on that. They look for signs of trust and integrity, which I think is good. I also consider AI is definitely a threat in the sense of if regulators don’t understand technology at the moment, and we’re still stuck in 2016 at the regulatory level, AI is just going to complicate that so much more, it’s going to make it so much harder for regulators who may not be tech savvy to understand. If governments are still behind the basic technology, it scares me to think how far behind they’re going to be in terms of AI as well.