Sports betting has been legal in Canada for a few years now, and the normalization of wagering on competitive events has many upsides, chief among them the ability to recoup tax revenue from an industry that has traditionally seen cash siphoned overseas and away from public coffers.

What’s become apparent from the past few years post-legalization is that the rush to bring sports betting into a regulated ecosystem caused certain oversights and issues that weren’t fully factored into the plans. Most prominently, the debate over how sports betting is advertised remains a point of friction, suggesting it may have been wiser to hold off on full-blown legalization until the rest of the regulatory framework was properly in place.

This debate underscores why this points to wider issues with the regulation of digital services, and what can be done in the future to avoid similar flare-ups.

An Imperfect Regulatory Focus

Authorities had a clear, already-mentioned incentive to legalize sports betting sites in Canada. On top of the tax revenues, which are already in the billions of dollars annually, there are the benefits for consumers. Domestically operated betting sites that must adhere to rules for player protection and data security are a far better prospect than grey-market, overseas operators.

The problem with pushing through legalization while only focusing on the betting side of the equation is that it left the marketing aspect largely unaddressed. Several more years elapsed before even fairly straightforward restrictions on the promotion of gambling services were introduced. In the interim, the market grew exponentially, and the pace of regulatory and legislative response to its impact was simply inadequate.

A Fragmented Framework

Provincial and federal regulations of gambling and broadcasting differ in Canada, so this divide means that making changes to how something like sports betting is advertised can quickly get mired in bureaucratic red tape.

Campaigners calling for a blanket approach to monitoring and restricting sports betting ads must contend with the notoriously slow process of drafting and passing relevant provincial and federal bills. Meanwhile, for betting platform providers, this fragmentation creates its own set of operational hoops to jump through, increasing costs in tandem.

Arguing for a Slow and Steady Approach

While Canada might have already pushed ahead with its legalization of sports betting—meaning that the debate over how this industry advertises itself can only happen after the fact—other countries can learn from its mistakes. The obvious conclusion to draw is that rules regarding the promotion of gambling services must be rolled into any legalization efforts as a matter of course. This might delay the legalization process, but it seems preferable to having years of subsequent limbo over industry marketing methods.

There are parallels to how the regulation of digital tools like cryptocurrencies and NFTs took a long time to catch up with the technology already in consumers’ hands. Lawmakers have to be more agile and reactive to avoid regulations being left behind in the wake of major changes such as these.