Skin in the Game Looks at How Counter-Strike Spawned Multi-Billion Dollar Gambling Sector
In case you missed it, ESPN.com featured an excellent piece on how Counter-Strike helped to create a multibillion-dollar world of online casino gambling that ultimately came crashing down late this past year following accusations of insider collusion, misrepresentation and under age gambling.
Beginning in July of this past year, Gambling911.com readers found themselves bombarded with breaking news about the Counter-Strike scandal with plenty of mention of a game developer called Valve.
ESPN.com explains how the concept works and why it’s become so popular:
While other titles such as Call of Duty offer similar gameplay, one distinctive feature has helped fuel Counter-Strike's growth: collectible items in the game called "skins." Although they don't improve anyone's chances of winning, the skins cover weapons in distinctive patterns that make players more identifiable when they stream on services like Twitch. Users can buy, sell and trade the skins, and those used by pros become hotly demanded. Some can fetch thousands of dollars in online marketplaces.
Valve controls the skins market. Every few months, it releases an update to Counter-Strike with new designs. It decides how many of each skin get produced and pockets a 15 percent fee every time one gets bought or sold on its official marketplace, called Steam. Valve even offers stock tickers that monitor the skins' constantly shifting values.
But Valve also leaves a door open into the programming of its virtual world, one that allows skins to move out of Steam and into a murky constellation of gambling websites, where they're used as currency. Some $5 billion was wagered in skins in 2016, according to research by the firms Eilers & Krejcik Gaming and Narus Advisors.
A lawsuit has since been filed against Valve and the company this fall began cracking down on skins that offer gambling.
