Virtual Assault Rifles, Minors and Online Gambling Perfect Together

• $2.3 billion gambling industry incorporating weapon skins
• CSGO: Lotto and its embattled owners encouraged minors to gamble while many skins allow children under the age of 13 to do so
• CS:GO teams have been embroiled in a form of match fixing, betting on their opponent and purposefully losing in order to win tens of millions in skins
• Game developer named in lawsuit accusing it of “knowingly allowing an illegal online gambling market while being complicit in creating, sustaining and facilitating that market.”

Welcome to the new unregulated Wild West world of online gambling, one that features, among other things, virtual assault rifles.

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If you haven’t used weapon skins, you likely don’t know about the $2.3 billion gambling industry that’s grown up around them, Salon writer Andrew Breiner reports.

The explosive industry gained nationwide attention this week when two YouTube celebrities were exposed as having ownership interests in one such company CSGO: LOTTO, all the while promoting said company without the proper disclosure, even encouraging minors to gamble.  Gamers view this as a serious conflict of interest while others in the community have demonstrated how some CS:GO skin unboxings have been rigged.

CSGO Lotto is among third-party sites that allow players to place bets on casino-style games with Counter-Strike: Global Offensive skins, according to a just-filed lawsuit.

The culprits taking center stage this week, Trevor 'TmarTn' Martin and Tom 'ProSyndicate' Cassell, are the owners of CSGO Lotto.  One of these individuals has been lambasted further by offering multiple half-hearted (some would say half-ass) video apologies, only to remove each of them from his channel.

CSGO Lotto and other forms of weapons-laced online gambling dates all the way back to 1998 when video gaming developer Valve introduced its first game, Half-Life.

With such popularity came a community of modders: often-independent developers who used the core of Half-Life to build their own game, Breiner explains.

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And one of the most popular of these mods to emerge was Counter-Strike, described by Breiner as “an online multiplayer game where players competed as either terrorists trying to complete an objective like planting a bomb, or as counter-terrorists trying to kill them and foil their plans”.

Just as some of the early online poker sites (i.e. Pacific Poker and Paradise) failed to gain much traction before the sector really took off some years later with the introduction of more superior platforms the likes of PokerStars and Full Tilt, the Counter-Strike: Global Offensive (CS:GO) series was not immediately popular after its release in 2012. But a year after CS:GO’s release, Valve introduced weapon skins, and it changed everything, and the rest is history.

The Salon piece goes on to further explain how the gambling aspect comes into play:

In 2016, Valve is not just a game publisher, but also the creator of Steam, the most popular service for buying, downloading, and playing computer games, and a requirement for playing CS:GO. The nice thing about owning the platform is that getting gamers to buy things in games with real money is pretty easy. After all, they already gave Steam their credit card numbers to buy the game in the first place.

It only takes a couple clicks to get from a game of CS:GO to buying what’s known as a “crate,” a $3 shot at finding a rare weapon skin. Like buying a pack of Pokemon cards or baseball cards in days of yore, this is already a low-level sort of gambling. 

Competitive matches helped turn skins from simple collectible items into a currency for gambling, Breiner explains.  Third party – mostly unregulated - sites quickly popped up and offered the ability to bet skins on games, which essentially turned them into a sort of currency.

Unlike your typical online casino, poker and sports betting site where the minimum age to play for real cash and or prizes is 18 (sometimes 21 depending on jurisdiction), Counter-Strike: Global Offensive (CS:GO) gambling allows those age 13 and up. Still, prepubescent children can easily get around this age restriction by simply entering whatever age the user wants to.  Yep, six-year-olds can, in theory, gamble on these platforms.

Breiner goes on to explain the mystique of the weapon skins that have made Counter-Strike: Global Offensive (CS:GO) so insanely popular:

Weapon skins are simply paint jobs for the guns and knives in CS:GO. The normal guns in the game look like guns: gray, metallic, and that’s about it. With custom skins, bright pink, green, blue, red, and orange are popular colors, and dragons, skulls, swirls, and gradients are dominant motifs.

Skins provide status symbols in a game that isn’t big on individuality. A rare skin is a sign of a dedicated player, and it provides an excellent visual identifier for the elite CS:GO players who participate in competitive matches for spectators, which itself is a major industry.

Rigging is one thing, CS:GO teams have also been accused of match fixing.  One was caught betting on their opponent and purposefully losing a match in order to win tens of millions of dollars in skins.  Sound familiar all you Gambling911.com readers?

Valve is currently named in an aforementioned lawsuit alleging the operator of Steam has “knowingly allowed an illegal online gambling market and has been complicit in creating, sustaining and facilitating that market.”

The complainant, Michael John McLeod, offers arguments that are deeply flawed, according to Matt Sayer of PC Gamer.

Sayer suggests that “Skins, unlike casino chips, do not exist primarily as a form of non-money currency. Whereas casinos use chips to exploit legal loopholes in staking cash and to distance gamblers from the money they’ve already essentially spent, Valve implemented skins as a means of customization and creative expression, both for the makers of the skins and those who use them. The use of skins evolved later, goes beyond their intended purpose, and was seemingly driven by third-parties, which weakens McLeod's argument that Valve built and supports the betting economy.”

Much of McLeod's arguments fall apart under proper consideration, Sayer asserts.

That's not to say, though, that Valve is necessarily innocent in all this. Legal precedent for the betting of virtual goods is lacking, and it will take cases like McLeod's to establish clear and decisive rules.

- Alejandro Botticelli, Gambling911.com