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UKGC Raises Concerns over eSports Betting

Date Posted: March 17, 2017

UK Gambling Commission recently gave its stand on the eSports gambling industry. It raised concerns about how certain betting sites are encouraging young people to gamble.

The concern focuses on the games that could be entering the jurisdiction of licensed gambling activities while also stressing the impracticality of using a zero-tolerance approach to the secondary market for skins or in-game items.

Skin betting sites

Certain eSports games have in-game items that have real-world value. People can sell these items through a game platform for virtual currency to buy games on the platform’s store front. There are also websites that allow people to sell the skins in exchange of actual money.

The primary way of getting skins is to buy an in-game key to unlock a game box. Unlocking the box will give a player a random in-game item. In a way, this is already an act of gambling.

Recently implementing new licensing fees, UKGC expressed its concerns regarding the gambling aspects of these virtual goods being used to make wagers on certain websites. Even if these goods are not actual currency, it still carries monetary value.  People might decide to spend money on getting more items to make wagers with.

Sarah Harrison, CEO of UKGC, warns parents of the dangers these betting sites could bring to their children. Young players might easily get encouraged to partake in these sights and are likely to ask parents for money to buy in-game items.

The event that sparked this concern from the UKGC occurred last September. UKGC filed illegal gambling charges on two eSports gambling site promoters. The two pled guilty and paid about £265,000 in legal fees and fines. The promotor’s marketing of the gambling sites is concerning since many of their viewers are children.

In UKGC’s recent gambling participation survey, 44 percent of participants aged 25-34 are likely to bet on eSports. Twenty-one percent of participants within the 35-44 year-old age group and 20 percent of those in the 18-24 year-old age group are also likely to bet on eSports. This shows that there is a large potential for the industry to encourage underage gambling.

UKGC underage gambling prevention

UKGC on eSports betting became serious after setting up the regulations last year. This is why all fiat and Bitcoin sportsbooks require a license from the commission office to run its business. Gambling sites that make use of game items will also require a license since these items are considered ‘de facto virtual currency’.

This ensures that the licensed gambling sites will implement certain measures to prevent underage gambling. These a fiat or Bitcoin sportsbook will also avoid using children in its marketing campaign. Any unlicensed gambling sites that show any signs that it could harm the children will face regulation and the necessary consequences.

Bitcoin players can place eSports bets at NetBet, which became the first UKGC-licensed gambling site to accept Bitcoin.