Virtual weapons won in some games can be bought for real money and used like casino chips on online gambling websites

This article is more than 4 years old

This article is more than 4 years old

In what could prove a world first, an Australian politician is seeking to have games such as the hugely popular Counter-Strike series defined in law as gambling.

Nick Xenophon, the independent senator for South Australia, on Sunday announced a bid to have multiplayer first-person shooter games defined as gambling in an update to the current Interactive Gambling Act of 2001.

“This is the Wild West of online gambling that is actually targeting kids,” Xenophon told Fairfax Media.

Counter-Strike: Global Offensive has become one of the world’s most successful first-person shooter games since introducing its “arm deal” update in August 2013, which allowed virtual weapons known as “skins” obtained in the game to be turned into real-world money.

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The skins are assigned a value according to their rarity, but can fetch thousands, and can be bought and sold in the game developer’s own marketplace or third-party sites.

Skins can also be used like casino chips in online games of blackjack and roulette.

The gaming research firm Eilers & Krejcik Gaming estimated in June that skin gambling had an annual turnover of as much as $9.74b. Of that figure, 25.8% – nearly $2bn – was on lottery-style jackpot games. Nearly 14% or $1bn was spent on roulette and 5.6% or $414m on flipping coins.



It also forecast that the market would continue to grow steadily.

The practice of skins gambling is understood to be widespread among young gamers, sparking concern among game developers and academics.

A Brisbane teenager told the Australian Broadcasting Corporation that he had lost about $1,800 from gambling on skins after having stolen his father’s credit card.

He said he had been inspired by top players who had posted videos of their big wins to YouTube and the video-game streaming platform Twitch.

Sally Gainsbury, a senior lecturer at Southern Cross University’s Centre for Gambling Education and Research, told Guardian Australia the prevalence of skins gambling – and the age of those who are participating in it – is difficult to track.

She said there was no doubt the law needed to be updated, but warned that classifying video games as gambling would be “problematic” when many did not fit that definition.

Even Counter-Strike: Global Offensive was in many ways different to similar games – but because the skins had real monetary value, and the game was so accessible to young people, the online gambling market was of real concern, she said.

Erik Johnson, the chief operating officer of Valve Corporation, the developer of Counter-Strike, clarified that the company had “no business relationships with any of these sites” in a statement earlier this month.



“We have never received any revenue from them. And Steam [Valve’s own marketplace] does not have a system for turning in-game items into real-world currency.”

Valve later ordered 23 sites to stop using its programming instructions and standards to facilitate skins gambling, but many are reported to be continuing to function as normal.

Xenophon told Fairfax the “insidious” games are “morphing into full-on gambling, and that itself is incredibly misleading and deceptive” – and said the current law, the Interactive Gambling Act 2001, was outdated.

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He said he would seek cross-party support for the bill he intends to introduce to update the legislation next month, when the federal parliament resumes sitting.

It could see the introduction of a minimum age on paying to play, or clear warnings of gambling content to be displayed on games.



Xenophon was unable to comment to Guardian Australia on Sunday, but told AAP that he wanted such sites to include warnings and block links to gambling sites.

“There are lots of unwitting parents out there who don’t realise their kids are being groomed to gamble this way,” he said.

Gainsbury supported an update to the law, pointing to research that shows people who play simulated games are likely to gamble money, and vice versa.

But she said video games were not the most pressing area of concern when existing sanctions on offshore gambling sites were not being acted upon.

She pointed out that though it was illegal for offshore gambling sites to allow people in Australia to bet on their sites, there had been no prosecutions.

“I think there’s a lot we need to do with regards to updating the law before we start looking at video games in particular – not that that’s not an important area.”