CS:GO Gambling and Betting

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Apr 26, 2007
3,663
334
28
Arizona
#1
Hey there,

So, late last night, I was browsing my Twitter feed and noticed that one of my favorite YouTube commentators and video game critics, John Bain (aka TotalBiscuit), vague referred to a recent bit of drama going on in the YouTube sphere. This is the post he made:

John Bain (@Totalbiscuit) said:
If Youtubers could stop doing shady, illegal, undisclosed shit for money that makes us all look bad, that'd be great.
Source: @Totalbiscuit on Twitter

In a second tweet he made later on, he specified that he thought that whatever this big issue was needed to go as far as be brought to the attention of the US government via the Federal Trade Commission (FTC).

The issue John's referring to in these tweets is the weapon skins 'market' in the game Counter-Strike: Global Offenses and two particular YouTube celebs that are making money off of it. Ethan of H3h3 Productions sums it up pretty well in a video.


If you'd prefer to read than watch a video, I'll try to summarize this below.

First, here's some background on CS:GO.

For those who don't play CS:GO, Valve has integrated a lootbox system into CS:GO -- one eerily similar to what's used in Blizzard's Overwatch. While both lootbox systems produce cosmetic skins that don't alter the game in any shape or form, CS:GO's system is different for two main reasons.

The first big difference is the fact that Valve requires that you pay to unlock these crates. Even if you played well and got a a lootbox, you still need to pay Valve $2.50 (USD) to get a digital 'key' to unlock a box. Keep in mind that the key disappears after you use it; you need to buy new keys for each box. The second big difference is that there is a whole economic market for these skins. These weapon skins can range anywhere from $0.01 in value to as much as $5,900. This is essentially gambling since someone is paying a small fee ($2.50/key) for a shot at something worth a large amount of money.

As if Valve's gambling 'mechanic' wasn't sketchy enough, evidence has now come up that two very popular YouTube commentators have been making money off of this, themselves.

Because of the skyrocketing popularity for CS:GO and this skin market it has, some decided to make some money on the side by running a gambling site for the game. Sites like CSGOLotto and others have popped up as places where people can bet their skins or Steam cash on various matches. According to articles from sources like Bloomberg and Game Sutra, as much as 2.3 billion bets and deals are made on these sites. Given that these sites likely generate ad revenue and might require a commission fee for processing trades/bets, there's a good chance that the owner, or owners, makes a decent chunk of change.

The owners of CSGOLotto are two fairly-popular YouTube commentators named ProSyndicate (Tom Cassell) and TmarTn (Trevor Martin). In addition to being very popular content-makers that produce videos that cover the gambling aspect and skins market of the game, these two have their names attached to the corporation that makes up the site CSGOLotto.

As if it wasn't bad enough that they're essentially pushing and less-than-subtly advertising CS:GO's gambling community, they're doing this without informing their viewers and subscribers of the fact that they own the site CSGOLotto. They're essentially sponsoring their own videos, but not telling their fans.

On top of questionable legality of not citing their ownership of this site in their videos, there's little-to-no word on the transparency of how this site was run. There are actual videos of them using the gambling system on this site, but no clarity on what the gambling system is or how it works. Given they own the site, who's to say they don't rig the outcome of the bets themselves.

So, here's a summary: we have a game developer that essentially built a community-based gambling system (Valve) and we have two YouTubers (ProSyndicate and TMarTn) that made money hand-over-fist by using their profit-making videos to shill their gambling site without disclosing that they own the damned thing.

Looks like YouTube isn't all copyright battles and threats of lawsuit, huh?
 

GearGades

Katbox Forum Member
#2
I Saw H3H3 and Scarce videos on the matter - really shitty what they where doing, considering the power of persuation some youtubers have on their audience and then make them play gambling games without no disclosure what so ever of their involvement is really scummy. In the wake of the whole Drama Debacle and other situations we've seen on Youtube in recent month, I agree with TB that not disclosing something as serious that can put you in trouble with the (FEDERAL) law can paint every youtuber in a bad light.

Now, in the long run, I don't think it will be bad for Youtube and it's creators, but it may not be good for Valve itself - Less than two weeks a Counter-Strike Player filed a lawsuit agaisnt Valve precisly involving in the gambling surrounding CSGO. I will admit, at first I didn't gave it much chance: but now having learned of the full revelation, it doesn't paint a pretty picture for Valve, nor for Tom and Trevor if these two get dragged in the Lawsuit http://www.polygon.com/2016/6/23/12...o-illegal-gambling-lawsuit-weapon-skins-valve
 
#3
I'm going to deconstruct this a bit.

Now, I can see where Valve thought what they were doing wasn't wrong. Many game out there (including so called "freemium" games) offer people the ability to buy in game items/skins/etc using real world money, and having these as random draws, as well as letting players buy, sell, and trade them. Here's the thing though. Those games allow people to get these random draws for free either through gameplay, giving players one draw a day, or a combination of both. So, people don't have to put down money for a chance to get these drops. Also, usually the online market place for these items uses in game credits, not real world cash. And those that do use real cash strictly control buying and selling them in game, and never allows any out of game market for these items.

What Valve has done with CS:GO is make it so that you can only get the items via random lottery by paying for them, and you can resell them outside the game. This has turned the game's skin system into a kind of slot machine, where players can pay to roll the dice, so to speak, and possibly gain items that can be sold for large sums of money. By definition, this is gambling. What makes this worse is that these lotteries are the very in game drops that you can only access via paying for them, meaning that you have to pay for your random in game drops.

And because you can sell these outside the game, it has spawned these online betting sites for CS:GO. I'm not seeing much evidence yet as to support that Valve is actively supporting or profiting from these sites (though they could be), but they have created the conditions to allow these to happen. And since there is no required age verification for these, minors can participate in these bets.

So, I wouldn't be surprised if the Federal Government might get involved in this.
 
Apr 26, 2007
3,663
334
28
Arizona
#4
What Valve has done with CS:GO is make it so that you can only get the items via random lottery by paying for them, and you can resell them outside the game. This has turned the game's skin system into a kind of slot machine, where players can pay to roll the dice, so to speak, and possibly gain items that can be sold for large sums of money. By definition, this is gambling. What makes this worse is that these lotteries are the very in game drops that you can only access via paying for them, meaning that you have to pay for your random in game drops.
I think Valve is justifying (or just plain not caring about) the ethical ramifications of all this by making it so that you're technically winning a digital product. See, as long as it isn't directly giving you money, they don't see it as gambling. This is actually a common 'loophole' that is used by other shady industries.

The most famous example I can think of is the pachinko parlors in Japan, which are an immensely popular place for adults to go to gamble. However, the Japanese government doesn't see this as gambling because gamblers make money indirectly in pachinko; the machines operate on and dispense small silver balls and when a player 'cashes out', they're given a voucher for the amount. That said voucher is, then, used to get a 'special prize' -- usually an item made of gold or silver and encased in plastic. Finally, they can sell or trade said item in an outside shop, often right next door, for cash.

And because you can sell these outside the game, it has spawned these online betting sites for CS:GO. I'm not seeing much evidence yet as to support that Valve is actively supporting or profiting from these sites (though they could be), but they have created the conditions to allow these to happen. And since there is no required age verification for these, minors can participate in these bets.

So, I wouldn't be surprised if the Federal Government might get involved in this.
Currently, Valve has placed a 'warning' on these gambling sites and are insisting that Valve, in no shape or form, encourages their use. As for the age factor, I've read its still very murky and grey. Valve only asks that you be thirteen in order to partake in the buying of loot keys and the selling of skins. However, most gambling sites (CSGOLotto, included) required you be eighteen in order to play. This could quickly come to an end, though, if the FTC or a state-level gambling agency gets involved.
 
Apr 26, 2007
3,663
334
28
Arizona
#6
I'm not sure about ProSyndicate, but TmarTn posted an apology video on the matter, but deleted it a short time later for some unknown reason. Another YouTube account re-posted it.


I haven't sat down to listen to the whole thing and I only just found out about it because PC Gamer posted it in an online article.

According to the article, the video's got a mixture of backpedaling (e.g., apologizing for letting people down) and professing his innocence by insisting that he violated no laws and that his status as site owner could've been easily verified by anyone.

In addition to covering this video apology, the PC Gamer article says that TmarTn has retained the services of a law firm, Watson LLP. I think it's a little unclear whether he simply is 'lawyering up' to defend himself in case he's mentioned in this class action lawsuit against Valve, or if he's going to go after the likes of TotalBiscuit, H3h3, and others for defamation over the public shaming he's getting in all these videos.

It's also worth noting that some legal experts are saying he, in fact, did violate the law with this. The most vocal legal expert is a lawyer name Ryan Morrison (@MrRyanMorrison on Twitter), AKA the Video Game Attorney, who says that both TmarTn and ProSyndicate are violating FTC regulations on sponsorship and advertising and that TmarTn, in particular, has not done a proper job disclosing his connection with the website/company.
 

GearGades

Katbox Forum Member
#7
I'm not sure about ProSyndicate, but TmarTn posted an apology video on the matter, but deleted it a short time later for some unknown reason. Another YouTube account re-posted it.


I haven't sat down to listen to the whole thing and I only just found out about it because PC Gamer posted it in an online article.

According to the article, the video's got a mixture of backpedaling (e.g., apologizing for letting people down) and professing his innocence by insisting that he violated no laws and that his status as site owner could've been easily verified by anyone.

In addition to covering this video apology, the PC Gamer article says that TmarTn has retained the services of a law firm, Watson LLP. I think it's a little unclear whether he simply is 'lawyering up' to defend himself in case he's mentioned in this class action lawsuit against Valve, or if he's going to go after the likes of TotalBiscuit, H3h3, and others for defamation over the public shaming he's getting in all these videos.

It's also worth noting that some legal experts are saying he, in fact, did violate the law with this. The most vocal legal expert is a lawyer name Ryan Morrison (@MrRyanMorrison on Twitter), AKA the Video Game Attorney, who says that both TmarTn and ProSyndicate are violating FTC regulations on sponsorship and advertising and that TmarTn, in particular, has not done a proper job disclosing his connection with the website/company.
I doubt TmarTn will file a defamation lawsuit, but if he does go after TB, H3H3 and the other Youtubers I would see the backlash agaisnt them going out of control that would force them run off from the internet. If he has follow the two major legal case that have Youtubers on the grip of their Pitch and Forks at all (the lawsuits agaisnt Jim Sterling and H3H3) he should realized the negative PR consequence of such action, so he better think twice - TheBoldGuy has not posted a thing on his youtube channel and facebook page since he sued H3H3 and his wife (specially the way he responded to the first wave of the backlash on his facebook page with such petulant impertinence), and Digital Homicide (James Romine) have gone in full denial since he filed the lawsuit agaisnt Jim Sterling - open to a counter lawsuit by Jim Sterling if James (very likely) loses the lawsuit in Arizona - with no real money achieved to get that good lawyer they babbled to Jim for months and their games been remove and reinstalled on Greenlight constantly.

Their one hope is that Valve finds a way to dismiss the lawsuit and this blows away with no further consequences - nor legally going after each other in imaginary defamation lawsuits - but their is no way that would happened cause no Judge or FTC agent in their right mind would ignore the fact MINORS were gambling and they (Valve, Tmar and Syndicate) allowed it and the two people who founded the company neither disclose it and posted essentially false promotions to the benefits of a system they control.
[doublepost=1467948293,1467871582][/doublepost]
From Scarce: CS:GO Lotto owners TmarTn and Syndicate been sued.
 

R_Riders

Katbox Forum Member
Jan 8, 2014
65
4
32
#8
This whole thing has left me, well, angered, enraged, and dissapointed among other things.

Of course it will always be discussed that I should not be so surprised. That this kind of shit pulled by the likes of TMarttn, Syndicate. Valve enabling this kind of shit to begin with, and wondering how in spite of their hands off approach, how far the rabbit shithole goes with them.

Someone will say 'this happens all the time, why be so shocked?' and maybe I should not be so shocked.

But I can't help but step back and be shocked, be angered even if I see it coming. But that stems from how ...I used to be a fan of Valve's games and Valve itself.

I'm wondering if I can even consider myself a Valve fan, I wonder what more will it take for me to throw valve in alongside the likes of Electronic Arts, Ubisoft, Capcom, Namco Bandai, Kofuckingnami and all ohters to which have either developed or published games I've come to love and admire...

Only for these companies to do shit that makes me want to just say 'fuck em'.

It upsets me to the core because I had this delusional thing with valve given how well put together a lot of their games are, flaws and all. It's numbing and just, sickening.

It's shit like this that makes me uneager to bother much with steam anymore, it's stuff like this that makes me want to simply cut myself away from almost any form of gaming because it seems like fucking everybody with the rarest of exceptions will leave me enraged in the end with what actions they may do.

It's going to be something how it'll all play out, I don't know however if I'm going to stand to see it myself because as I've ranted elsewhere, my shit filter has been full.
 

Falc

not my words
Gallery Volunteer
Jun 5, 2013
822
187
27
The City
#10
I imagine that it was the possibility of lawsuits that made Valve take that stance. To be entirely fair, I personally feel that Valve wasn't so much in the wrong as some have argued, largely because until this became a huge legal issue, it was a tricky situation for Valve that they could afford to ignore/overlook. If they changed the trading API, they'd have to rework the Community Market (and all of that came from people ascribing value to glorious hats well before Valve decided to cash in). I really don't think Valve ever intended the community gambling, it just arose on its own.