Key Takeaways
Skin wagering will only exist to the extent
Valve allows it to exist
Only some skin wagerers will embrace regulated, real
money esports betting
Valve is a private company that created and owns skins, the Steam
marketplace and CS:GO, the digital gaming world from which skins
derive their primary function as cosmetic weapons alterations.
As esports grows as a spectator sport, more and more spectators
could choose to engage with esports through gambling. A
reduction in readily available skin wagering options would seem
to point willing esports bettors toward more transparent, regulated,
real-money esportsbooks. To an extent, this is true. Revised
estimates from Narus Advisors and Eilers & Krejcik Gaming
predict the global esports cash gambling handle will grow
from $649M in 2016 to almost $12B in 2020.
Therefore, Valve, not regulatory bodies, remains the single
largest threat to skin wagering’s existence. If Valve wanted to, it
could pursue skin wagering more aggressively and shut down all
trade bots even remotely connected to skin wagering. That it has
only weakened skin gambling as opposed to completely crushing
it raises more questions than answers, but does not diminish the
fact that Valve still has the firm upper hand over skin sites.
Skin wagering will still continue, albeit
at a highly reduced level
Valve can shut down every Steam trade bot that it wants, but it
will have a much harder time stopping determined developers
from creating new skin gambling websites and creating new bot
accounts. In this way, the future of skin gambling could be
subjected to a continual game of cat and mouse.
As long as the ecosystem’s primary ingredients—Steam, CS:GO
and skins themselves—exist, sites such as Fast will likely continue
to pop up. While both skin gambling and skin betting should
continue at a drastically reduced level going forward, the
necessary components remain available for savvy
entrepreneurs to exploit.
Government bodies will focus on esports cash
wagering regulation, not skin wagering regulation
Of the many European regulatory bodies to discuss esports
betting in general, only the UK and Netherlands commissions
have nominally referred to skin betting. As more regulatory
bodies learn about the nature of skins and the difficulties of
regulating skins wagering, this is not likely to change.
Two US states (Nevada, New Jersey) have addressed esports
wagering on any level, and neither of those have mentioned skin
betting by name. Nevada regulators are currently in the process
of determining whether to classify esports for wagering purposes
as a sport or as an event. Meanwhile, New Jersey’s Division of
Gaming Enforcement adopt