Valve Cracking Down On Skin Gambling Sites

Valve have announced they will start cracking down on websites which use Counter-Strike: Global Offensive [official site] weapon skins and Dota 2 items as chips for gambling. For years they’ve quietly tolerated them, but recent gambling scandals and lawsuits have given Valve and CS:GO a lot of nasty attention. They’ve had enough of it.

I always knew ‘skin gambling’ would be part of our dystopian future but, to be honest, I had thought it’d be fleshier.

Let’s recap once more! CS:GO has loads of different weapon skins which change how guns and knives look but not how they work. Players can get them as ‘drops’ by playing, by paying to unlock virtual weapons crates, by swapping them in Steam Trading, and by buying them in the Steam Community Market. Skins are purely for funsies but fads and artificial scarcity mean that certain skins are more desirable. Players can also swap skins through Steam or sell them for Steam credit through the Steam Market. That’s the legit side, working as Valve intended. This is a good read for more on that. It’s largely the same in Dota 2, only with wizard hats.

Then there’s the less-official side. Gambling sites connect to players’ accounts through legitimate channels and take their skins as currency for gambling. Some sites let players bet skins on competitive matches to win more skins, while others are basically lotteries where people can win all the skins every player put into the pot. And while Steam only lets players sell items for store credit, some trusting people do buy and sell them for real money by transferring payment outside Steam then passing skins over through Steam Trading. Some go for hundreds of dollars.

This isn’t all massively shady, to be clear. For many players, skin gambling is just a bit of harmless fun. Though, obviously, any form of gambling can be a serious problem for some people.

Valve have quietly tolerated, but never endorsed, the gambling until now. While skin gambling has caused scandals and upsets before, from scams to permanent competitive bans for match-fixing, a whole load have recently come at once.

In June, a player filed a lawsuit against Valve, alleging that they “knowingly allowed, supported, and/or sponsored illegal gambling” by making it possible. The suit also says that, without age verification, Valve are letting minors gamble. At the start of July, several popular YouTubers admitted that were the owners of a CS:GO lottery they had promoted in videos without disclosing any interests. Another lawsuit went after them. Then another YouTuber admitted they had been paid in rare skins for a video with a faked big win in another skin lottery. It’s a bit ugly.

Sounds like Valve have had enough. Here’s the full statement they sent us today:

“In 2011, we added a feature to Steam that enabled users to trade in-game items as a way to make it easier for people to get the items they wanted in games featuring in-game economies.

“Since then a number of gambling sites started leveraging the Steam trading system, and there’s been some false assumptions about our involvement with these sites. We’d like to clarify that we have no business relationships with any of these sites. We have never received any revenue from them. And Steam does not have a system for turning in-game items into real world currency.

“These sites have basically pieced together their operations in two-part fashion. First, they are using the OpenID API as a way for users to prove ownership of their Steam accounts and items. Any other information they obtain about a user’s Steam account is either manually disclosed by the user or obtained from the user’s Steam Community profile (when the user has chosen to make their profile public). Second, they create automated Steam accounts that make the same web calls as individual Steam users.

“Using the OpenID API and making the same web calls as Steam users to run a gambling business is not allowed by our API nor our user agreements. We are going to start sending notices to these sites requesting they cease operations through Steam, and further pursue the matter as necessary. Users should probably consider this information as they manage their in-game item inventory and trade activity.”

However, while Valve indeed never received any money from the gambling sites, they have benefitted from the lively item economy stimulated by gambling. Players buy keys from Valve to get more skins, and Valve take a cut of all Steam Market sales.

I wonder if we’ll ever see some sort of official – and regulated – faux-gambling on Steam. Valve do often pick up and improve community ideas, and I know a fair few people who have enjoyed skin gambling purely for funsies. It might take a full server of lawyers to clear an idea like that.

From this site

47 Comments

  1. Jediben says:

    There will be no gambling. The laws in all the different countries that Steam is available in would open them to incredible levels of regulation and liabilities.

    • Hobbes says:

      The bots they use will simply move from API calls to profile scraping (this is already happening), and more likely will move to Russian servers because then it’s legally unenforceable – and although the Steam accounts will be ROW and usable outside of Russia, thus bannable, whatcha gonna do, the skins will move about at the kind of speeds that mean you’ll have to ban tons of smurf accounts constantly? – Valve will end up whacking moles all day long, and for them that’s effort, Valve and Effort is like mixing Oil and Water, nope!

      • Eamo says:

        They can prevent most if not all of this with a few easy tweaks to trading rules.

        1. No trading of items that have widely disparate marketplace values.
        2. No trading on an account until 30 days after your total steam spend hits $50 or something like that.
        3. No gifting unless you have been mutual friends with that person for over 30 days.

        It would be a bit inconvenient but I suspect the vast majority of legitimate accounts could continue on without any interruption but it would make it very difficult to set up any trade bots or coordinate off site trading.

        • Eamo says:

          Sorry, when I say “no trading” I meant between users. They can allow marketplace usage at any time. As long as you don’t know who you are trading with it is very hard to do any sort of off site trades.

  2. Gotem says:

    I imagine this will also affect all those sites for trading cards and weapons.

  3. OmNomNom says:

    Why would anyone give enough of a poop to gamble for that nonsense?

    • mollemannen says:

      me and a friend went from 100$ to 650$ (worth of skins) during the recent major. the thing is we only bet on matches and never casino. betting on matches is still ok but it’s the 50% coinflip sites were people get scammed.

      • CMvan46 says:

        The thing is there are legal online sportsbooks that already have esports. In Canada we have playnow.com which has esport games listed. There is no reason to use shitty sites like these. If you want to bet it’s still entirely easy to do just not on sites that let underage users do so.

    • Juan Carlo says:

      Because you can make money off of it. Real money, not just steam funny money. Which is ultimately why Valve could be held liable, but I doubt it. We’ll see, I guess. I’m not sure how they could crack down on it, short of severely restricting their item market, which I doubt they will ever want to do.

  4. Baines says:

    Semi-related note, it looks like the new bot plague in comments (not on RPS, but elsewhere) are bots promoting CSGO gambling sites.

    • Press X to Gary Busey says:

      The internet really became the dystopic early 90’s envisioned cyberspace. The only thing missing is poorly rendered full-body VR browsing.

      • Juan Carlo says:

        Steam turned into a libertarian hellscape so gradually I barely noticed.

      • Kollega says:

        Anyone remember that late 90s case when Microsoft almost got split into two companies by an antitrust regulator? Yeah.

    • Bent Wooden Spoon says:

      You sure they’re not YouTube streamers who forgot to log out of their alts?

  5. Juan Carlo says:

    To me this constitutes a real scandal that the gaming press should be actively reporting on more, rather than just passing along Valve’s press releases. From the press release it seems Valve aren’t cracking down on anything, just asking gambling sites politely to stop.

    • Slazia says:

      Temporary / full banning people who use the sites would be a better option.

      • Slazia says:

        And to be honest, there’s not really that much Valve can do without stopping Steam trading. If you can trade, you can gamble.

        • Slazia says:

          It’s almost like blaming banks for allowing people to gamble with their currency. Short of not letting people have money, there’s nothing they can do.

          • Juan Carlo says:

            That’s a terrible analogy I’ve heard before. Valve has more culpability than a bank in this case because, unlike banks, Valve completely controls the market. They are the ones who determine the algorithms that make items common or rare. They are the ones that control all the avenues by which items can be traded. And unlike Casinos (which are highly regulated), Valve can do pretty much anything it wants to control the market.

    • PikaBot says:

      “Sending notices requesting that they stop” sounds an awful lot like getting a lawyer to send a C&D to me.

    • KDR_11k says:

      To be fair sites are reporting on everything that’s going on but there’s not THAT much going on. No criminal investigation has been announced and the only legal action is that class action lawsuit against valve that has added the deceiving tubers. There’s simply not much left to say.

  6. Halk says:

    Valve actually bothered to comment about something?
    This must really be serious for them because usually they can’t be bothered to communicate anything at all.

    • Mortivore says:

      I remember in March 2015 where they made a statement that their Customer Support was shit and could use some improvement.

      See how that’s coming together.. /s

    • CMvan46 says:

      They are in a lawsuit about this very thing right now. It’s a lawyer’s statement more than anything and the only reason they commented at all.

  7. Plank says:

    Anyone know what CS:GO skin gambling is like in VR?

  8. Geebs says:

    Valve have absolutely and obviously set these systems up as “gambling for minors” and are clearly enjoying the benefits of acting as a casino – and that’s just the loot creates. Frankly it’s pretty gross, and asking the other sites to stop their crummy and exploitative business is rank hypocrisy.

  9. jrodman says:

    Personally I’d be very happy to permanently opt out of all item trading in Steam. I wonder if Valve could be possibly bothered to offer me that. It would be a step towards solving the problem, including reducing the amount of steam-related spam I receive.

  10. Capt. Bumchum McMerryweather says:

    What I find so bizarre is that more gaming sites aren’t reprimanding these fucking clowns. Even before skingate what they were doing was absolutely reprehensible, placing a minimum age of 13 on these sites, therefore hooking kids into gambling addictions nice and young. I used to work in the online gambling industry, and I’ve personally witnessed the financial destruction of someone with a gambling addiction. It was horrible, and made me realise what horrible actions I was taking by working for this company. It’s fucking disgusting what these guys are doing, and I hope they get everything that’s coming to them.

  11. mrdan says:

    However, while Valve indeed never received any money from the gambling sites, they have benefitted from the lively item economy stimulated by gambling. Players buy keys from Valve to get more skins, and Valve take a cut of all Steam Market sales.

    Tesco sells apples. People start using apples to gamble. Tesco benefits from increased apple sales. Tesco must be held responsible for gambling!

    • Premium User Badge

      basilisk says:

      Tesco artificially limits the sales of apples with specific features in order to make some apples more valuable than others. Tesco sells apples in a black bag so you don’t know the value of the apple you’re buying.

      Yes, this analogy makes so much sense.

      • mrdan says:

        What has any of that got to do with the part I was quoting? Analogies generally don’t have a exact 1 to 1 mapping in all aspects. That would kind of limit their utility…

        • Smion says:

          This CS:GO gambling scandal is like that CS:GO gambling scandal.

          • mrdan says:

            Tesco apples are like weapon skins, covered in flames and skulls and have marginal nutritional value.

    • Capt. Bumchum McMerryweather says:

      Conveniently forgetting that apples grow on trees.

      Joking aside, in the case of this particular analogy do you not agree that in this case it would at least be fair for Tesco to discourage the actions being taken by the apple gambling sites, rather than quietly benefitting off the (very) unethical actions of their customers?

      • mrdan says:

        It would be fair, and it seems Valve has done / is doing that, despite there being no real obligation to. My main objection to the quote was that despite Valve doing that, the author seemed intent on assigning them some blame or responsibility when really they have none.

    • Plank says:

      Really mrdan!? Did you even read their statement?

      Valve have known for years that gambling sites have been using the Steam API.

      Ok, that really isn’t a big deal, a number of trading sites that have nothing to do with gambling use the Steam API.

      But what were the users of these gambling sites gambling with?
      CS:GO skins.

      Who sells the CS:GO skins?
      Valve.

      So let’s recap: Valve have known for years that CS:GO skin gambling sites were using the Steam API and Valve were selling the CS:GO skins.

      • Geebs says:

        Then valve take a cut when the skins are traded….

      • mrdan says:

        Yes, I read it, thanks. I’m not really sure what your point is. Nothing you’ve said changes what I was talking about. To add to the Tesco analogy: Tesco has a door. People use the door to go in and buy apples. Tesco knows people use the door. I still don’t see how that makes Tesco responsible for how people use apples, even if the use of apples generates Tesco extra sales as a side effect. Tesco certainly hasn’t been encouraging it.

        • Plank says:

          If someone was to go on Tesco.com and bought a bag of Tesco branded apples and then went on to GambleTescoProducts.com that used Tesco software to gamble the Tesco apples, and Tesco had known for years about this practice then Tesco would be liable.

          You do see the problem right? Tesco would be selling the apples/casino chips while looking the other way as people gamble them on a site that uses Tesco software.

          • mrdan says:

            That doesn’t really match up. They’re not using Valve software to do the gambling as such. They could still operate without using the API at all, if they trusted their users to actually follow through on losing trades.

            The gambling sites use the API as an interface to trade user’s skins around, but all the gambling is outside of Valve’s system.

            It would be like you opening a stall near Tescos, handling the betting, and sending someone in to Tesco to collect the apples on behalf of a customer who has given you explicit permission to do so.

            I’m sure Valve don’t want to be known as profiting from such skeezy business. I just don’t think they can be blamed for how people use this shit just because they make money off it as a side-effect. I’m sure there’s lots of legitimate uses for steam APIs. I use isthereanydeal myself. Valve makes money off this usage because I buy more games.

  12. Louis Mayall says:

    As they mentioned on a recent Crate and Crowbar, the weirdest thing about this scandal is that all the skins are fucking awfu;l. Like crazy ugly. I get that they’re just chits, but still. Wow

    • C0llic says:

      I think that speaks to the predominantly young teenage boy market that gives these ugly atrocities value. 11 -14 year olds don’t have good taste.

  13. theirongiant says:

    Want to distance themselves from gambling sites but not the slot machine nature of the crate system – remember kids gambling’s only bad when it’s someone else doing it.

    • Stellar Duck says:

      Crates are unforgivable.

      Fuck Valve for doing that particular shit.

      All of the item and market crap on Steam belongs in the trash

  14. C0llic says:

    They shouldn’t have ever allowed it to get this far. Now they’re going to have considerable issues stopping it. A hands off approach is fine, but they were foolish to never make statements about the legitimacy of these sites before this. That could have at least potentially slowed down how many and how big they are.

    What they really need to do is change their API and actually take some responsibility for the nature of sites who link to it. I know why they’ve never done that, but legal action might force their hand.

    • C0llic says:

      It is perfectly possible to police the use of an API – sites like youtube do it. They need to make that happen and black-list the shady stuff.