The discussion over loot boxes, and whether their use in video games constitutes a form of gambling, became an increasingly debated issue in gaming and esports last year. The Belgian Gaming Commission has already declared that loot boxes are gambling and “dangerous to the mental health of young kids” and eyes a Europe-wide ban. Germany is now following its European neighbor’s steps, as a German regulatory body considers banning in-game loot boxes.

[perfectpullquote align=”right” cite=”” link=”” color=”” class=”” size=””]Game publishers might face financial penalties once the final decision is made in March.[/perfectpullquote]

The University of Hamburg has conducted a study analyzing the loot box market, as reported by German newspaper Welt. It took a close eye on game developers’ business model in regards to loot boxes and came to the conclusion that a “typical indicator of a gambling market” exists, as a few players are responsible for a large majority of the revenues. According to the study, the “pay to win” model brought game developers and publishers €8 billion (around $10 billion) in 2016, with revenues increasing by 30 percent in 2017.

Following the publication of the report, the Landesmedienanstalt—the supervisory authority for private radio, television, and digital media in Germany—considers issuing a ban on loot boxes, with the final decision expected in March. The head of its Youth Protection Commission, Wolfgang Kreissig, said that loot boxes are probably violating the German youth protection laws and game developers who use them might face financial penalties.



Except for Belgium and Germany, Britain also supports the cause for the ban of loot boxes, after its gambling commission found that 11 percent of youngsters under the age of 16 have betted with in-game items.

Whether banned or not, there is a strong call for certain regulations around loot boxes to be established. A majority of The Esports Observer’s readers, in a recent TEO Poll, voted that loot boxes do indeed constitute a form of gambling.