Nick Xenophon Proposes Crackdown On Rampant, “Insidious” eSports Gambling

Australia’s go-to guy for giving gambling a swift kick in the pants has turned his sights on the third-party betting market popularised by computer games like Counter-Strike: Global Offensive. 

Nick Xenophon has announced his intention to crack down on ‘skins’ gambling, a fairly new and rapidly growing grey area. 
It’s a bloody wild frontier with different layers of madness, so it’s worth getting the basics down first. Essentially, CS:GO‘s developer Valve currently allows players to buy ‘keys’ for a few real bucks through their online marketplace Steam. 
In turn, those keys can be used to open ‘crates’, which randomly contain the aforementioned skins* – which are basically just different colour schemes and statistic trackers for in-game weapons. 
They’re not required in any way to actually play the game. They’re purely cosmetic, and 100% optional.
The process of obtaining skins from Steam is pretty similar to playing the pokies, and you may already be able to see why Xenophon isn’t so hot on the entire concept, but this deal gets a whooole lot murkier from here on out. 
The rarity of some skins is where things get really interesting. Their value is analogous to that of trading cards – they’re just pixels, you know – but a legitimate market for ’em has opened online.

Although you can’t directly get actual currency back from Valve by trading in your skins, you can sell and purchase them for real money through third-party marketplaces.

Thus, if you drop US $2.50 on a key and open a crate that bears a super-rare skin, you could flip that for thousands of dollars to someone who really, really wants a golden knife. Or, increasingly, you could sell it to a speculator who wants to flip it later when they become even rarer. 

You only need to dip your toes into the gaming community on YouTube to see how hyped people can get when they find a rare skin, because they are now worth beaucoup bucks.

However, Xenophon is most interested in the concept of using effectively using skins as gambling chips. Third-party sites bearing no affiliation to Valve nor Steam have allowed users to place their skins on the line while a digital coin is flipped. If you win, your opponent’s skins are traded to you.
Gambling in that way might seem kinda ridiculous, and solid statistics on the industry’s cashflow are hard to come by, but some estimates state billions of dollars of skins are effectively won and lost in this way each year.

Oh, and because there is so little regulation on this area, you better bloody believe kids have been deliberately sucked in. 

You needn’t look farther than the recent exposure of the popular YouTubers / video game streamers Trevor “TmarTn” Martin and Thomas “ProSyndicate” Cassell.

They effectively advertised their skin gambling site CSGO Lotto to their impressionable audience without ever disclosing they owned it, all while being able to manipulate the site’s bets in their favour.

In effect, they were encouraging their viewers to play craps with their own loaded dice, and made off like bandits in the process. FWIW, Valve has issued cease and desists to a stack of similar sites, ’cause they do not want to be implicated in that BS.

Regardless, gambling legislation is simply not currently equipped to deal with the multiple layers of fucked-up-ness on display in that ongoing saga, and that is why Xenophon has stepped up.
Speaking to Fairfax today, Xenophon said “this is the Wild West of online gambling that is actually targeting kids,” and he’s proposed a bill that would codify this entire sphere as online gambling. 
He continued, saying that games like CS:GO, which is truly just a beloved multiplayer first-person shooter on the surface, are “morphing into full-on gambling and that itself is incredibly misleading and deceptive.”


One method Xenophon’s proposed legislation may use is to outright ban developers like Valve from accepting real-world money for keys in the first place. Tougher age restrictions and clear warning signs are also viable options. 
As for the third-party sites? Well, an entirely different set of regulations would need to be enacted to ensure that players know the risks they’re taking, and to keep proprietors in check. 
Make no mistake, it’ll be a challenge to wade through each level of this one, but you’re not likely to find a guy who hates manipulative gambling practices more than Nick Xenophon. Watch this space when parliament resumes next month. 
*Or hats, if you’re one of the degenerates like this writer, who is still clinging on to Team Fortress 2. 

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