In September 2026, the Financial Action Task Force (FATF) published its report Risks of Gaming and Gambling, a systematic analysis of the risks of money laundering, terrorist financing and proliferation financing in casinos, sports betting, other forms of gambling and online gaming.
The value of this report does not lie in classifying every form of gaming and gambling activity as inherently high-risk. What matters far more is that FATF identifies a trend that deserves particular attention from virtual asset service providers (VASPs). As online operations, cross-border activity, multiple products and different payment methods merge into a single system, gaming and gambling platforms are becoming part of a broader ecosystem for moving funds.
In the report, FATF sets out a wide range of specific risk indicators covering several areas: customer and account behavior, betting patterns, payments and transactions, and the characteristics of platforms and their business models. This article focuses on the indicators that relate directly to the movement of funds and to identifying risk on the blockchain. The full set of risk indicators, along with specific examples, can be found in the original FATF report.
The core of gambling-related risk: funds «come in, pass through the platform and go out»
The traditional view of how gambling can be used to launder money goes like this: funds arrive on a platform, pass through a small amount of betting or seemingly ordinary gaming activity, and are then withdrawn in a different form. The red flags FATF highlights focus precisely on these patterns of money movement, which do not match the legitimate purposes of using a platform.
An amount that arrives on a platform, is used for a handful of bets and is then withdrawn to another account may not look unusual if each stage is viewed on its own. However, when deposits, bets, withdrawals, links between accounts and the payment channels used are analyzed together, these transactions may turn out to mean something entirely different.
How the risks spread to the virtual asset ecosystem
FATF notes that the gaming and gambling industry is increasingly connected to a range of ways of moving value, including cash, bank cards, bank transfers, virtual assets, mobile payments and third-party intermediaries. The shift to online and cross-border activity has further reduced the geographical limits on moving funds, while making the links between different platforms, accounts and services more complex.
This means that the risks do not necessarily stay inside gambling platforms. When funds enter or leave the gaming ecosystem through virtual assets, the associated risks may surface at crypto exchanges, payment institutions and other platforms that provide virtual asset services.
For virtual asset service providers, however, the mere fact that a customer's address has transacted with a gambling platform or has received a gambling-related risk label does not mean that the funds are necessarily of illicit origin. FATF also stresses that a single risk indicator is not enough to prove money laundering, terrorist financing or proliferation financing.
What actually needs to be established is what that link means in the broader context of financial relationships. For example, an address may have an indirect connection to a gambling entity, but assessing the risk requires taking into account the number of intermediate transfers, the amount and share of the funds, the frequency of transactions, information about the customer and their past behavior. Conversely, ignoring links to high-risk or unlicensed platforms can also lead to missing risk signals that call for further investigation.
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This approach has a lot in common with an earlier analysis of risk management practices at the OKX crypto exchange: when dealing with high-risk funds, exchanges need to look not only at whether an individual transaction falls into a particular risk category, but also at the source of funds, the counterparties, direct or indirect interaction, and where the money goes next.
For risks that span several platforms and different business scenarios at once, the following analytical approach therefore becomes more useful:
- Who is the customer?
- Where did the funds come from?
- Which entities has the customer interacted with?
- Which addresses have the funds passed through?
- Are there persistent anomalous patterns of behavior?
- Does the current transaction match the customer's historical activity?
Combining this information makes it possible to go beyond a single risk label, reconstruct the underlying financial links and build a clearer and more verifiable basis for assessing risk.
From one-off checks to ongoing risk management
In practice, screening, investigation and ongoing monitoring need to be connected.
Organizations can first use address and transaction screening to identify known high-risk parties or risk types, and then carry out a further investigation based on information about the customer, the sources of funds, on-chain counterparties and the routes the money has taken. Where the available evidence and applicable rules support it, the organization can decide whether enhanced due diligence (EDD), restrictive measures or a suspicious transaction report is required.
This is not a single process that FATF prescribes for every organization, but rather a practical, risk-based approach.
This helps reduce the number of wrong decisions that arise from relying on a single risk label alone, and also makes internal reviews, audits and ongoing compliance documentation easier.
