Canada’s Fastest-Growing Gambling Formats Fall Outside Traditional Regulation, CasinoCanada Research Finds

The online formats attracting Canada’s younger players are growing in areas that fall outside the country’s established gambling laws, according to new research from CasinoCanada.com.

The research highlights the challenges facing a regulatory framework designed primarily for casinos and sportsbooks, as gaming becomes more casual and increasingly takes place across alternative formats.

Canada’s Gambling Test Under Section 206

Under Section 206 of the Criminal Code, an activity is considered gambling when prize, chance and consideration are all present. If any one of these elements is absent, the activity falls outside the definition.

Canadian courts have rejected the ‘predominance’ test used in other jurisdictions, meaning that any element of chance is sufficient. However, a product without chance or monetary consideration is not classified as gambling.

The three formats examined in the research are treated differently under Canadian law.

Ontario’s Alcohol and Gaming Commission of Ontario (AGCO) treats fantasy sports as sports betting, meaning operators serving Ontario players must be licensed. Elsewhere in Canada, daily fantasy sports (DFS) remains in a position similar to 2015, when a legal opinion commissioned by the Canadian Gaming Association concluded that it was not based purely on skill. The issue has not been tested in court.

Social casino games use virtual credits, meaning that no item of monetary value changes hands. As a result, the format is legal and unregulated nationwide. Research And Markets values the social casino sector at $10.08bn in 2026, with the market projected to reach $14.42bn.

Prediction markets, meanwhile, are classified as financial derivatives and fall under securities law.

Younger Audiences And Alternative Gaming Formats

The research suggests that these formats are reaching the same younger audience targeted by licensed gambling operators.

A November 2025 report from Greo Evidence Insights, the Canadian Centre on Substance Use and Addiction and Mental Health Research Canada found that approximately one in three Canadians aged 18 to 29 had gambled online during the previous year.

Separate research by Kim et al. (2017) found that 62% of online gamblers began with social casino games.

A July 2026 survey by The Logic found that almost 58% of respondents opposed the legalisation of prediction markets.

CasinoCanada Calls For A Broader Regulatory Approach

Eugene Ravdin, head of PR at CasinoCanada, said:

“Ontario and Alberta answer the question they were built to answer – how you license and tax a casino-style operator safely. That part works.

“The harder question is a fantasy contest, a free-to-play slots app or an event contract. None of it triggers provincial oversight, and all of it reaches the same young audience licensed operators reach through far tighter channels. The UK treats tradeable in-game items as a currency; Australia age-gates by classification. Canada has one lever: license it or leave it alone.”