Sweden’s Black Market Crisis: Jesper Karrbrink Sees 50/50 Split in Revenue

The debate over channelization in online gambling has reached a new peak. Jesper Karrbrink, Chairman of hosting specialist Internet Vikings and CEO of Immense Group, paints a bleak picture of the current market situation in Sweden. While official authorities speak of a channelization rate of around 84 percent, Karrbrink considers these figures a dangerous misjudgment of reality. In his view, the monetary flows have long been split equally between legal and illegal channels.

The core problem, according to Karrbrink, lies in the way data is collected. Estimates are often based on traffic figures, which do not reflect actual stakes. Furthermore, sectors like trotting, which in Sweden is a de facto monopoly with no significant black market competition, skew the overall statistics. If these specific areas are removed, the legal quota drops significantly. The discrepancy between clicks and capital is the central argument of the experienced manager, who previously served as CEO of Mr Green for years.

Numbers and facts

Internet Vikings currently operates in 24 US states and follows a strict strategy of exclusively serving licensed markets. In the US, however, the market for online casinos is still heavily restricted, with only seven states having legalized this form of gaming so far. The growth dynamics are therefore increasingly shifting towards prediction markets and sweepstakes, which Karrbrink avoids because they are unlicensed.

A look at the Swedish figures illustrates the seriousness of the situation. Karrbrink estimates the actual channelization to be only 70 to 75 percent when looking at the market realistically.

"Money-wise there’s much more money outside. I would say that money-wise it’s back down to 50/50." - Jesper Karrbrink, Chairman at Internet Vikings

Particularly alarming is an example from Germany that Karrbrink cites: a single black market operator there is said to have generated revenue amounting to a third of the entire regulated market. This illustrates the financial power behind unlicensed offers, while state authorities often only scratch the surface.

Background

Karrbrink also expressed very critical views on developments in Brazil. He bluntly describes the Brazilian government's actions—pushing operators out of the market after just two years despite having paid for five-year licenses—as fraud. Such political decisions undermine trust in international regulatory efforts. For Internet Vikings, the motto remains clear: the focus is on first-class hosting for the regulated sector in Europe and the US. The technical infrastructure is continuously expanded to handle peak loads, such as during a World Cup, without issues. Founders Rickard and Victor bring over 20 years of industry experience to avoid potential failure points in hosting solutions.

Why it matters for German players

For players in Germany, Karrbrink's statements underline the importance of the Gemeinsame Glücksspielbehörde der Länder (GGL). The German Interstate Treaty on Gambling 2021 (GlüStV 2021) was created specifically to prevent such 50/50 scenarios. Anyone playing at providers not on the official GGL whitelist enters the financial gray area described by Karrbrink. In Germany, strict protective measures apply, such as the cross-operator deposit limit of 1,000 euros per month and the stake limit of 1 euro per spin on virtual slots. These rules, supported by the LUGAS monitoring system, serve to make the legal market safe. Players should always check if a casino holds a German license to avoid becoming part of the black market statistics, where player protection is often a foreign concept.

What it means for GGL-licensed casinos

Licensed operators face the challenge of remaining competitive despite strict requirements. If Karrbrink's assessment that the black market is financially as strong as the legal sector is correct, GGL casinos must score with reliability and security. High costs for compliance and taxes in Germany make it difficult to compete with unregulated offers regarding payout ratios. Nevertheless, legal certainty for companies and protection for customers are high-value assets. The industry must work together with the GGL to improve channelization so that the pendulum in Germany does not also swing towards 50/50, as Karrbrink fears for Sweden.