Steam has a gambling problem

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Some prominent Counter-Strike: Global Offensive players were accused of posting deceptive videos related to a site they apparently own on which people can wager cosmetic CS:GO skins. These personalities claimed to have found this site that lets them put up their CS:GO weapon skins against others and win easy money since some of the skins are potentially worth hundreds of real dollars. Unfortunately, the videos failed to disclose that it wasn’t so much that the hosts “found” the site, but actually “founded” it. They were registered as co-owners since the company’s inception. In the wake of the scandal, another popular YouTube CS:GO player made a troubling confession admitting to showing rigged bets in his CS:GO skin wagering videos for another similar site. Ugly all around.

While these specific incidents may break various truth-in-advertising laws, and raise questions about the legitimacy of the supposedly random payouts, they also highlight an issue that has been growing since Team Fortress 2 started the cosmetic skin craze. Steam has become a catalyst for underage gambling. Because these in-game cosmetic skins don’t have a fixed monetary price, the in-game random distribution of them through loot drops or boxes defy conventional gambling laws. At the same time, the rarer skins hold high value and can be traded for Steam items (including other skins) that do have cash worth. Thus you end up with lucrative businesses like the CS:GO betting sites that encourage gambling for kids as young as thirteen.

While Valve doesn’t directly participate in this grey industry, a pending lawsuit accuses the company of turning a blind eye to the business and facilitating the corruption of minors by allowing these third-party sites to use Steam’s data. The suit further alleges that Valve benefits from the betting by gaining a percentage of the skin value traded during each transaction.