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Hiding in plain sight: Detecting underground sportsbooks through local Bitcoin demand

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  • Marmora, Paul

Abstract

Utilizing an event-study design across 41 countries, I find that countries with restrictive gambling laws and large shadow economies experience an abnormal spike in local Bitcoin activity immediately following their national team’s World Cup matches. This pattern is observed in measures of both local Bitcoin attention and local Bitcoin trade volume, is primarily concentrated in countries where gambling is expressly prohibited, and is independent of the game’s outcome or tournament round. Taken together, the results strongly suggest that local residents use Bitcoin to maintain anonymity when settling wagers placed with underground sportsbooks. In further support of this conclusion, I find a similar post-match pattern in local attention to other cryptocurrencies popular among criminals and a similar Bitcoin trade volume pattern following local interest in betting odds for other sporting events.

Suggested Citation

  • Marmora, Paul, 2026. "Hiding in plain sight: Detecting underground sportsbooks through local Bitcoin demand," Journal of International Money and Finance, Elsevier, vol. 161(C).
    • Handle: RePEc:eee:jimfin:v:161:y:2026:i:c:s0261560625002487
    DOI: 10.1016/j.jimonfin.2025.103513
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • E41 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Demand for Money
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • K20 - Law and Economics - - Regulation and Business Law - - - General
    • Z20 - Other Special Topics - - Sports Economics - - - General
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets

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