Scale of the underground market (Ecuador)

Scale of the underground market

Since 2011, land-based casinos and gaming halls have been banned in Ecuador. At the same time, the demand for excitement has not disappeared: some went offshore online, some went offline (underground slot rooms, "clubs behind the partition," casino apartments, hybrids with access terminals to Internet casinos). "Underground" is not one type of activity, but an ecosystem with different formats, risks and payment channels. Its volume is difficult to assess, but you can build a frame of indicators and a script fork.

What exactly we consider "underground"

Slot/" Internet clubs" with real or emulator machines.

Apartments and office clubs under roulette/blackjack/" electronic tables."

Hybrid points: offline checkout + terminals/PCs for entering offshore sites (the cashier makes a deposit/cache out).

Quasi-lotteries/" sweepstakes "with cash equivalent prizes for regular commercial operation.

Mobile "halls" with fast equipment transfer.

(Social/one-time charitable bingo without wagers or credits does not apply here.)

Why volumes are difficult to measure

1. Invisibility and mobility: short leases, "double doors," "demo mode" when alarmed.

2. Mixing formats: one address can work either as an "Internet club" or as a "slot."

3. Financial disguise: deposits through "service" codes, P2P, vouchers, crypto-stablecoins.

4. Lack of a single registry: there is no central database of closed/identified points with a unified typology.

Indicators to rely on

Enforcement: the number of raids, seized machines/terminals, closed premises, repeated "returns" to the same address.

Financial traces: micropayment anomalies "for services," P2P spikes on the same wallets/agents, unlicensed POS.

Injury/incident data: Rise in police/ambulance calls at night in 'clusters' with suspicious activity

Digital metrics: traffic to offshore domains, downloads of mirror applications, local search queries.

Social signals: complaints from residents, ads "for their own," closed chats/channels.

Evaluation fork: three scenarios (box for feasibility study/report)

Scenario	Underground share of offline "potential"	Visible activity	Payment channels	Social footprint
-----------------------	-------------------------------------:	---------------------------------------------------	----------------------------------------	--------------------------------------------------
S1 "Conservative"	15–25%	Outbreaks in vulnerable areas, rare "frontal" halls	Cash, some P2P	Local complaints, isolated incidents
S2 "Market"	25–40%	Sustainable clusters in Quito/Guayaquil + suburb	Cash, P2P, vouchers, some stables	Systemic complaints, periodic raids and "returns"
S3 "Aggressive"	40–60%	Network of points, fast moving, hybrid with online	Cash, P2P, crypto-stables, "agents"	Rise in petty crime, debt stories

"Offline potential" - the counterfactual capacity of the ground hall market in the absence of a ban (estimated by analogues of the region, tourism and pre-crisis data until 2011).

This fork is not a statistic, but a methodological frame: substitute your observed data and get a range.

Regional lesion map (summarized)

Quito: La Mariscal and neighboring neighborhoods, transportation hubs and "second lines" of commercial streets. Mixed clientele (local, expats, tourists).

Guayaquil: zones near the port and trade clusters, streets with dense bar infrastructure. More evening and night flow.

Provinces and suburbs: small cities near highways, where control is weaker, renting a point is cheaper, and "noise" is less.

How the "shadow" is connected with offshore online

Points - "gate": offline cash desk accepts deposits/displays cache, and the game goes online. The user believes that he is "playing in the hall," but legally it is an offshore platform.

Marketing from sports: the visibility of bookmaker sponsorships (legal vertical) increases the recognition of brands that also have casino sections (gray segment).

Technology: Mirrors and mobile apps localized under Ecuador provide an out-of-pocket influx.

Underground payment channels

Cash (high share, fast, no trace).

P2P/mobile translations (often with "disguise" of destination).

Unlicensed POS (payment as a "service").

Stablecoins (USDT/USDC) - point, for "wholesale" calculations or bundles with offshore online.

Risks for the player: lack of checks, "manual" adjustment of payments, debts "before receipt" at interest.

Socio-economic effects of the underground

Withdrawal of turnover from the tax base and leakage of margin offshore.

Local security problems: theft, conflicts, pressure on residents.

Personal losses: debts, tension in families, loss of employment due to night games.

Reputation of neighborhoods: reduced investment attractiveness of streets "with a gray train."

Dynamics 2024-2025 (generalized trends)

More "hybrids" offline ↔ online: offline checkout + access terminals to the site/application.

Instant messengers and closed chats are the main channel of information "for your own."

Police/municipal point operations with re-checks of "returning" addresses.

The tax-licensing circuit for sports betting is stabilized, but does not apply to online casinos, leaving a "gray" area that fuels the underground.

How to measure "shadow" in practice (checklist for analyst/mayor's office)

1. Reduce disparate bases: police, municipality, firefighters, sanitation, complaints from residents → a unified register of addresses/raids.

2. Cluster analysis: grouping addresses by quarters, distance to bars/transit nodes, "lifetime" points.

3. Fintech signals: anomalies on P2P and POS codes at night (together with banks/providers).

4. Online metrics: local search demand, attendance of mirror domains, application downloads (aggregated).

5. Capacity assessment: calibrate S1-S3 scenarios based on seizures/raids (seized machines × average turnover by regional analogues × "invisibility" coefficient).

Containment policy: What works best

"Multi-tool" raids: police + municipality + fire/sanitary standards (close not only "for excitement," but also for safety precautions/regulations).

Financial monitoring: cutting off P2P templates and unlicensed POS, training banks' cash desks in risk triggers.

Work with landlords: contractual bans on "hidden redevelopments," the right to immediate termination in case of illegal activities.

Community polishing: anonymous message channels, feedback to residents about the results.

Leisure alternatives: night cultural events, safe transport, support for local sites - reduced demand for "fast excitement near home."

Responsible play/help: counseling lines, self-exclusion programs, financial behavior education.

Hard hand risks without alternatives

Exclusively force pressure without an alternative evening product and financial filtering of payments leads to "cat and mouse": points close and move, and control costs grow. The balance of law enforcement + prevention + alternatives more effectively reduces the overall volume of the underground.

Ecuador's underground gambling market is a mosaic of offline formats and connections with offshore online. Its exact size can hardly be called, but the range and dynamics can be assessed by the combination of indicators. While offline casinos are prohibited, and online casinos are not regulated, the "shadow" will fill the demand. It is possible to maintain its scale through multi-tool control, financial filtering, work with landlords/communities and the development of safe night leisure - this reduces not only "gray" turnover, but also social damage for districts and families.