Casino Korea

Gambling and COVID-19 in South Korea: Pandemic Impact, Digital Shift, and Policy Response

The COVID-19 pandemic, which reached South Korea in January 2020, fundamentally disrupted every aspect of society, and the gambling landscape was no exception. From the extended closures of Kangwon Land and foreigner-only casinos to the dramatic surge in illegal online gambling, the pandemic compressed years of structural change into mere months. Understanding these transformations is essential for grasping the current state of gambling in Korea and anticipating future regulatory challenges.

This article examines how COVID-19 affected gambling in South Korea across multiple dimensions: the impact on legal gambling operations, the acceleration of the digital shift to online gambling, disruptions to treatment and prevention services, economic consequences for the industry, and the lasting policy implications that continue to shape Korean gambling regulation in the post-pandemic era.

Korea's Pandemic Response Context

South Korea's response to COVID-19 was internationally recognized for its effectiveness in the early phases of the pandemic. The government implemented aggressive testing, contact tracing, and targeted containment measures rather than nationwide lockdowns. However, social distancing guidelines, capacity restrictions, and periodic enhanced measures significantly affected businesses, including gambling venues.

According to the World Health Organization, South Korea's early pandemic response became a model for other nations. Yet even with this relatively measured approach, the gambling industry experienced profound disruption that revealed both vulnerabilities and adaptations that continue to influence the sector.

Timeline of Key Pandemic Measures

The pandemic's impact on gambling unfolded in phases:

Impact on Legal Casino Operations

Korea's legal casino industry, comprising Kangwon Land (the only casino where Korean citizens can gamble) and 16 foreigner-only casinos, suffered catastrophic revenue losses during the pandemic. The industry that had generated over ₩3.2 trillion (approximately $2.7 billion) in revenue in 2019 saw this figure collapse by more than 70% in 2020.

Kangwon Land: Extended Closure and Slow Recovery

Kangwon Land's experience illustrates the pandemic's severity. The casino closed on February 23, 2020, and did not reopen until June 30, 2020a 128-day closure unprecedented in the company's history. When it did reopen, capacity was limited to 50% initially, then fluctuated between 30-75% based on social distancing levels.

Year Revenue (₩ trillion) Visitors (million) Year-over-Year Change
2019 (pre-pandemic) 1.60 3.1 Baseline
2020 0.55 1.0 -65.6%
2021 0.78 1.4 +41.8%
2022 1.18 2.3 +51.3%
2023 1.52 2.9 +28.8%

The Kangwonland Casino Recovery Fund, initially established to support the depressed mining region, ironically required government support during the pandemic as casino taxes plummeted. The local economy of Jeongseon County, heavily dependent on casino-related employment and spending, suffered accordingly.

Foreigner-Only Casinos: Tourism Collapse

The 16 foreigner-only casinos, operated by companies including Paradise Co. and Grand Korea Leisure (Seven Luck brand), faced even more severe challenges. These casinos depend entirely on international visitors, and the collapse of inbound tourism devastated their operations.

Paradise Co., the largest operator with properties including Paradise City in Incheon and Paradise Casino Walkerhill in Seoul, reported an 89% revenue decline in 2020 compared to 2019. The company implemented layoffs, salary reductions, and facility closures to survive. Grand Korea Leisure, the casino subsidiary of the Korea Tourism Organization, reported similar catastrophic declines.

Recovery for foreigner-only casinos lagged behind Kangwon Land because it depended not just on domestic pandemic measures but on international travel resumption. Chinese tourists, who historically constituted the majority of casino visitors, remained restricted from travel longer than most nationalities. The industry only began meaningful recovery in the second half of 2022 as China relaxed its zero-COVID policy and international tourism resumed.

The Digital Shift: Surge in Online Gambling

While legal gambling operations contracted, illegal online gambling exploded during the pandemic. The combination of closed physical venues, increased time spent at home, economic uncertainty, and stimulus payments created conditions for a dramatic surge in online gambling participation.

Statistical Evidence of the Shift

Data from the National Gambling Control Commission (NGCC) and Korean National Police Agency documented the shift:

Research published in the Journal of Gambling Studies found similar patterns globally, with multiple studies documenting increased online gambling during pandemic lockdowns. Korea's experience aligned with international trends while reflecting unique national characteristics.

Youth Gambling: The Most Alarming Trend

Perhaps the most concerning pandemic legacy was the dramatic increase in youth gambling. With schools closed or operating remotely and young people spending unprecedented time online, exposure to gambling increased significantly.

According to the Korea Problem Gambling Agency (KPGA), the number of teenagers receiving treatment for gambling problems more than tripled between 2020 and 2023, rising from approximately 1,500 to over 4,100 cases. The nature of youth gambling also shifted: before the pandemic, sports betting dominated teen gambling (48% of cases in 2020), but by 2023, online casino gambling had become the primary form (59% of cases).

This shift has significant implications. Online casino games are more addictive than sports betting due to their faster pace, continuous availability, and immediate reinforcement. Young people who began gambling during the pandemic may face lifelong consequences. The treatment success rate for youth gamblers has declined from 49.2% in 2020 to 24.9% by 2023, reflecting both the severity of online gambling addiction and treatment system challenges.

Youth Gambling Warning Signs

Parents and educators should watch for signs of gambling problems that may have developed during or since the pandemic:

  • Secretive use of devices, especially late at night
  • Unexplained financial transactions or requests for money
  • Preoccupation with gambling-related content or discussions
  • Declining academic performance or social withdrawal
  • Mood changes tied to unidentified "games" or "activities"

Help is available: Korean Center on Gambling Problems Youth Line: 1336 | KPGA Youth Counseling: www.kcgp.or.kr

Cryptocurrency Gambling Emergence

The pandemic also accelerated the growth of cryptocurrency gambling. As Bitcoin and other cryptocurrencies surged in value during 2020-2021, attracted by both investment mania and pandemic conditions, the intersection of crypto and gambling grew. Cryptocurrency's perceived anonymity (though this is largely a myth) and ease of cross-border transactions made it attractive for accessing offshore gambling sites.

Korean authorities struggled to track and enforce against cryptocurrency gambling during the pandemic, with blockchain tracing capabilities still developing. The Financial Services Commission's subsequent tightening of cryptocurrency exchange regulations, including the Virtual Asset User Protection Act, partially addressed these concerns but gambling remained a significant use case for crypto outflows.

Treatment and Prevention Service Disruptions

The pandemic created a cruel paradox for gambling treatment: just as gambling problems increased, access to treatment decreased. Treatment centers faced closure orders, social distancing requirements disrupted group therapy, and many individuals in recovery lost the support structures that maintained their abstinence.

Service Delivery Challenges

The Korea Problem Gambling Agency's network of regional treatment centers experienced significant disruptions:

Transition to Telehealth

Treatment providers rapidly transitioned to telephone and video counseling. This transition, while necessary, presented challenges for gambling treatment specifically:

However, telehealth also offered benefits. Geographic barriers were eliminated, allowing rural patients to access specialists in Seoul. Stigma around in-person treatment center visits was reduced. Scheduling flexibility increased. These benefits have led to permanent integration of telehealth options into Korea's gambling treatment infrastructure, even as in-person services have resumed.

Mental Health Crisis Intersection

The pandemic's mental health toll intersected with gambling problems in concerning ways. Depression and anxiety, which commonly co-occur with gambling disorder, increased dramatically during COVID-19. The suicide risk associated with problem gambling was compounded by pandemic-related economic hardship and social isolation.

Treatment providers reported that pandemic-era patients often presented with more severe mental health symptoms alongside their gambling problems, requiring integrated treatment approaches. The complexity of cases increased even as treatment access decreased, straining an already limited treatment infrastructure.

Economic Dimensions

The pandemic's economic impact on gambling extended beyond casino revenue to affect employment, tax revenue, and related industries.

Employment Impact

The legal gambling industry directly employs approximately 30,000-35,000 workers in Korea, with additional indirect employment in hospitality, transportation, and support services. Pandemic closures and reduced operations led to:

Government relief programs, including employment retention subsidies and business support payments, partially cushioned the impact. However, some casino employees permanently left the industry for other sectors, creating workforce challenges as operations normalized.

Tax Revenue Implications

Gambling-related taxes fund important government programs including the Korean Center on Gambling Problems, problem gambling treatment services, and regional development initiatives. The revenue collapse affected these programs:

This created a challenging dynamic: treatment need increased while treatment funding decreased, exactly when resources were most needed.

Illegal Market Growth

While legal gambling revenue plummeted, the illegal market expanded. Law enforcement estimated that the illegal gambling market, including underground gambling dens and online operations, grew to 2-4 times the size of the legal market during the pandemic. This shift deprived the government of tax revenue while increasing social harms from unregulated gambling.

The pandemic demonstrated the substitution effect in stark terms: when legal gambling access decreases, demand often shifts to illegal alternatives rather than disappearing. This dynamic has informed subsequent policy discussions about whether legal gambling regulation might better protect consumers than prohibition.

Policy Response and Regulatory Adaptation

Korean gambling regulators faced unprecedented challenges during the pandemic, requiring rapid adaptation and policy innovation.

Immediate Crisis Response

The National Gambling Control Commission (NGCC) and related agencies implemented emergency measures:

Online Gambling Enforcement Evolution

The pandemic accelerated enforcement evolution regarding online gambling. Authorities enhanced their technical capabilities:

The Korea Communications Commission (KCC) reported blocking over 20,000 gambling websites in 2020 alone, a significant increase from pre-pandemic levels. However, the whack-a-mole nature of this enforcement means new sites continue to emerge as quickly as others are blocked.

Long-term Policy Implications

The pandemic experience has influenced ongoing policy discussions in several ways:

Digital Gambling Regulation Debate: The surge in online gambling has intensified debate about whether Korea should consider regulated online gambling as an alternative to prohibition. Proponents argue that regulated markets would generate tax revenue, fund treatment, and provide consumer protections impossible in illegal markets. Opponents, including many within the current government, maintain that any legalization would increase harm.

Treatment Infrastructure Investment: Recognition that treatment services were insufficient to meet pandemic-era demand has supported calls for expanded treatment infrastructure. The Korea Problem Gambling Agency has received increased budgetary allocations for service expansion.

Youth Protection Focus: The alarming rise in youth gambling has elevated prevention as a policy priority. Enhanced school-based prevention programs, parental education initiatives, and platform-level controls are under discussion.

The future of gambling regulation in Korea will inevitably be shaped by lessons learned during the pandemic.

Vulnerable Population Impacts

The pandemic disproportionately affected certain groups already vulnerable to gambling harm.

Elderly Gamblers

Elderly gamblers, particularly those who frequented Kangwon Land, faced unique challenges. Social isolation during the pandemic was especially severe for older adults, and for some, gambling had been a primary social activity. When casinos closed, the loss of social connection compounded the gambling disruption.

Paradoxically, some elderly gamblers may have benefited from casino closures, experiencing forced abstinence that broke gambling cycles. Treatment providers reported that some older patients who had struggled to self-exclude found pandemic closures provided the external barrier they needed. However, post-pandemic relapse rates in this population have been concerning as casinos reopened.

Women

The pandemic had complex effects on women gamblers. Research suggests women's gambling increased more sharply than men's during the pandemic, potentially reflecting:

Treatment data suggest women were less likely to seek help during the pandemic despite increased gambling, potentially reflecting caregiving responsibilities that made treatment access even more difficult.

Military Personnel

Military personnel faced distinctive pandemic conditions. Restrictions on leave and external recreation increased boredom and stress on bases. The 2019 policy allowing smartphone use in barracks remained in effect, meaning soldiers had continuous online gambling access even as other recreational outlets closed. Military authorities reported increased disciplinary cases involving gambling during the pandemic period.

Economic Hardship Cases

Those who experienced pandemic-related job loss or income reduction were particularly vulnerable to gambling problems. Some turned to gambling in hope of solving financial difficulties, falling into the trap of trying to win back losses. The gambling debt crisis intensified during this period, with loan shark (sajae) activity reportedly increasing as desperate individuals turned to illegal lending.

International Comparisons

Korea's pandemic gambling experience paralleled and diverged from other nations, providing useful comparative perspective.

Global Trends

Research published by the National Institutes of Health documented increased online gambling across multiple countries during the pandemic. Common patterns included:

However, countries with regulated online gambling markets (United Kingdom, Australia, parts of Europe) were able to implement player protection measures such as deposit limits, cooling-off periods, and mandatory messaging that illegal markets cannot enforce. This observation has informed discussions about potential Korean online gambling regulation.

Japan Comparison

Neighboring Japan provides interesting comparison. Japan's pachinko industry (which occupies a legal gray zone similar to gambling) also faced closures during the pandemic's "state of emergency" periods. However, Japan lacks the extensive illegal online gambling market that expanded in Korea, likely because pachinko satisfies gambling demand that would otherwise seek other outlets.

Japan's integrated resort (IR) development plans, which were progressing before the pandemic, experienced significant delays partly due to COVID-19 disruption. This may affect Korea's own potential casino expansion discussions.

China Comparison

China's strict online gambling enforcement and internet controls meant less pandemic-era online gambling surge than Korea experienced. However, Chinese gambling demand shifted to cryptocurrency gambling and VPN-accessed sites in ways that may parallel Korean patterns. The outbound gambling tourism from both countries to Macau ceased during the pandemic, with uncertain recovery patterns as travel normalizes.

Post-Pandemic Recovery and Lasting Changes

As Korea entered the post-pandemic period in 2022-2023, the gambling landscape showed both recovery and permanent transformation.

Legal Gambling Recovery

Legal gambling operations have largely recovered in terms of revenue, though visitor patterns have shifted. Kangwon Land approached pre-pandemic revenue levels by 2023, though visitor counts remained slightly lower, suggesting higher spending per visitor. Foreigner-only casinos recovered more slowly as Chinese tourism took longer to normalize.

Permanent Digital Shift

The shift toward online gambling appears permanent rather than temporary. Many who transitioned to online gambling during the pandemic have not returned to physical venues. This has implications for:

Hybrid Treatment Models

Treatment delivery has permanently incorporated telehealth options developed during the pandemic. The Korean Center on Gambling Problems now offers telephone, video, and in-person counseling, allowing patients to choose based on preference and circumstance. This hybrid model improves access while maintaining in-person options for those who prefer them.

Enhanced Youth Focus

The youth gambling crisis revealed by the pandemic has led to sustained policy attention. Prevention programs have been expanded, and the NGCC has prioritized youth protection in its strategic planning. However, the challenge remains immense given young people's digital fluency and the continuous availability of online gambling.

Lessons for Future Crises

The pandemic experience offers lessons applicable to future public health emergencies or other crises that might similarly disrupt gambling patterns.

Preparedness Recommendations

Policy Considerations

The pandemic has strengthened several policy arguments while weakening others. The case for some form of regulated online gambling has gained support from those who note that prohibition did not prevent the online gambling surge but merely drove it underground. Conversely, the case for maintaining physical casino restrictions has gained support from those who note that Kangwon Land closures may have provided respite for some problem gamblers.

Resolution of these debates will depend on value judgments about acceptable harm levels, government's role in regulating personal behavior, and pragmatic assessments of enforcement effectiveness. The pandemic has provided abundant data to inform these discussions but has not resolved the underlying value conflicts.

Frequently Asked Questions

How did COVID-19 affect Kangwon Land and Korean casinos?

COVID-19 devastated Korea's casino industry. Kangwon Land closed for 128 days in 2020 and operated under severe restrictions through 2022. Revenue dropped from ₩1.6 trillion in 2019 to ₩550 billion in 2020, a decline of over 65%. Foreigner-only casinos faced even steeper drops as international tourism collapsed, with some reporting 90% revenue declines. The industry only began meaningful recovery in late 2022.

Did online gambling in Korea increase during the pandemic?

Yes, online gambling surged dramatically. Police reported a 40-50% increase in illegal online gambling cases in 2020-2021. Youth online gambling increased most sharply, with teen gambling treatment cases tripling between 2020 and 2023. Many who began gambling online during the pandemic continued afterward, representing a permanent structural shift.

How were gambling addiction treatment services affected by COVID-19?

Treatment services faced severe disruptions. In-person counseling was suspended during lockdowns, group therapy was particularly affected, and residential programs faced reduced capacity. Paradoxically, treatment need increased while access decreased. The treatment success rate for youth gamblers declined from 49.2% in 2020 to 24.9% by 2023.

What lasting changes did COVID-19 bring to Korean gambling patterns?

COVID-19 accelerated permanent changes: the shift to online gambling appears irreversible; youth gambling patterns fundamentally changed toward online casino games; cryptocurrency gambling emerged as a significant concern; and remote treatment delivery has become a permanent complement to in-person services.

Conclusion

COVID-19 transformed gambling in South Korea in ways that will persist long after the pandemic itself has faded from acute concern. The virus closed casinos, accelerated the digital shift to online gambling, disrupted treatment services at the moment of greatest need, and revealed vulnerabilities in Korea's gambling regulatory framework.

The pandemic's most troubling legacy may be the surge in youth gambling that emerged during lockdowns and has continued in their aftermath. A generation of young Koreans was introduced to online gambling during formative years, and the consequences will unfold over decades. Addressing this generational challenge will require sustained investment in prevention, treatment, and enforcement targeting online gambling.

Yet the pandemic also prompted adaptations that may serve Korea well. Treatment systems developed telehealth capabilities that improve access. Enforcement agencies enhanced digital tracking capabilities. Policymakers gained vivid evidence of the substitution effect whereby restricting legal gambling can shift demand to illegal alternatives.

As Korea continues its post-pandemic journey, the gambling sector remains in transition. Legal casino operations have largely recovered, but they operate in a fundamentally changed landscape where online gambling has grown from niche concern to central challenge. The policy choices made in response to this shift will shape Korean gambling for decades to come.

Getting Help

If you or someone you know developed gambling problems during the pandemic or is currently struggling, help is available:

  • Korean Center on Gambling Problems: 1336 (24-hour helpline)
  • Korea Problem Gambling Agency: www.kcgp.or.kr
  • Mental Health Crisis Line: 1577-0199
  • Korea Suicide Prevention Hotline: 1393 (24/7)

Both in-person and telehealth treatment options are now available. You can use our Problem Gambling Self-Assessment Tool to evaluate your gambling behavior confidentially.

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