What is 'skin betting'
Skin betting is a form of unregulated gambling, arising from loot boxes in games. Arising from the popular computer game Counter Strike Global Offensive (CSGO), an underground economy of online casinos have emerged. And, unlike regular casinos, CSGO casinos can operate without any restrictions imposed by regulation.
How CSGO skin betting works:
In the game, loot boxes are purchased using real-world currency, with various possibilities of getting skins. These skins are aesthetic bonuses in the game. CSGO sells these as “cases” for $2.5 USD each. Under randomisation, rare skins carry a higher value to players, whilst the common skins are cheap.
In these CSGO casinos, instead of real currency, people buy in by trading in skins from their Steam accounts (Steam is an online storefront for many online games). Gambling on these sites varies from slot machine-style games to placing bets on esports matches. When a player has finished gambling, they can cash out their skins back to their Steam accounts. When in personal Steam accounts, players can use them in-game, trade with other players, sell for Steam credit (Steam's custom currency), or sell for real cash using third-party sites.
Social media and audience
Skin betting is a calculated industry fuelled by social media, further pushing exposure to gambling on youth audiences. Specifically, those who engage with gaming and streaming content - teen boys. Investigations of CSGO streamers (people who game and stream live online) reveal an overwhelming majority who are sponsored by gambling sites to push and promote the sites to their audiences.
“Of the top 300 CS:GO streamers, more than 200 are sponsored by the industry”
CGSO gambling is harmful to children
Many of these skin betting sites operate without regulation and dodge various gambling regulations using legal loopholes. The biggest issue this poses is the lack of protection to prevent underage gambling. No adequate age verification on these sites allows anyone, regardless of age, to access.
These findings are confirmed by CSGO streamer Jeff, who surveyed around 9000 CSGO gamblers. He found:
- 70% of respondents said they started gambling on these sites underage
- 50% said they were introduced to gambling by youtubers and streamers
An Australian study reveals adolescent skin gamblers are more likely to report lower wellbeing than adolescents who did not skin gamble (12-17). Additionally, the gambling group was more likely to meet the criteria of problem gambling.
The scale of skin betting is something not to be understated. Jeff also conducted an investigation into the popularity of the sites. He revealed that CSGO gambling websites' viewership was 20 million more visits than the top online casino. CGSO gambling sites received almost double the viewership. Experts estimate that $3 billion was wagered in online CSGO gambling in 2016. The popularity of these sites are a huge danger to the millions accessing them and not being protected.
Why is skin gambling, "gambling"?
Aside from the copycat mechanics and gambling elements in these CSGO gambling sites, the wins and losses carry real monetary value. Besides casinos, there is a range of third-party sites where users can have their skin inventory valued and cash out their skins for real currency and cryptocurrency.
Let's look at what Denmark thinks of skin betting:
In Denmark, operators must apply for a license from the Danish Gaming Authority if a site meets the definition of gambling. CGSO gambling sites meet this definition. Thus, any CGSO gambling site without a license is unlawful. In 2018, Danish courts found that several CSGO gambling sites were offering unlicensed gambling and were blocked. In 2019, the Danish courts blocked 25 more sites for the same reasons.
How can children be protected?
Awareness of the existence and dangers of these CSGO gambling sites is important for parents to know. If you think your child is being affected by these sites, PGF services offers free, professional and confidential support.
