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The Banning of In-Game Loot Boxes

By Chris Blain
Published on January 03, 2018
Banned Loot Boxes

After countless hours of acquiring the resources necessary to purchase the items, you now have the opportunity to experience some good fortune. Finally, the time has come to open up the loot crates and see the treasures that await you inside. Your palms begin to sweat as you slowly begin opening them.

The first one is filled with garbage, and the second one as well. After making your way through one crate after another, you have opened them all, and found utter garbage – a mixture of stuff you already had and nothing else worth mentioning.

Unfortunately, it was not your day, and now you need to acquire the resources again to make another attempt at some new loot crates. This is not the greatest of options, but it is an inevitable part of the game, and luck is just one of those important aspects.

Today you shall learn about the joy that surrounds the notorious loot boxes and the potential risks they have of becoming banned by law. If you are an esports bettor, it is wise to know what is going on with the laws, because they can impact your wagers and future funds dramatically.

Micro-Transaction Criticism

If you have been around the gaming community within the past few years, I am sure you have heard the term “micro-transaction” before. These are in-game purchases where you can pay real life money to get things within the virtual world.

The type of micro-transactions that are available will depend greatly on the game, and can range from content such as levels or characters to items. Most of the time, in the case of items in popular titles, they are cosmetic style, and will not impact gameplay such as skins, but still hold a type of value.

However, that is not always the case in all games, because micro-transactions can be utilized to greatly benefit you and provide an extremely unfair advantage over your opponents. That is one of the main issues why freemium games have gotten a certain reputation.

What Are Loot Boxes?

Loot boxes are digital treasure chests that contain a set amount of items that will either be awesome or pretty much worthless. Depending on the game, they can contain things such as cosmetic skins, items, characters, and so on.

They will provide interesting things such as emotes, dances, character voices, and potentially valuable skins that can be traded. You can get loot boxes via in-game rewards by playing, or you can use real money to purchase them.

Since the loot boxes are randomized and whatever is inside is determined by random number generators, the concept of gambling has been associated with them. The idea does not seem so far-fetched, because frankly, you are paying for a chance at a great item or worthless junk.

Pay-To-Win

One of the main criticisms that freemium games have gotten over the years is that those who spend the most money on micro-transactions have an advantage. This occurs most often when the type of transactions that are available provide such things as power-ups to characters.

The idea behind selling in-game items for money makes for a smart business model, because the company is reliant upon the micro-transactions, and that is why the game is offered as free-to-play. Games that require you to buy troops and what-not are notorious for micro-transaction issues.

This model is not always looked upon favorably by the player community, because many believe that it removes the skill element of a video game.

People don’t think game outcomes should be based on who spends the most money on the game.

The players do have a solid point in not liking the model because of the skill element being taken out of the game. There usually is some way to earn credits within the game so that actual money is not required to buy the items, but it takes a large amount of time.

Still, it is rather difficult for players to amass enough resources through normal gameplay compared to just buying stuff with actual money. For example, in troop based freemium games, those who spend the most money will typically be able to reign as champions over the virtual universe.

Pay-to-win style games have a certain stigma around them and receive heavy criticism, because people are not happy when others can just pay money to be the best. Even when you can get the items through in-game currency, the idea that spending money can give you a leg up doesn’t jive with most players.

That is why many of the most popular titles in competitive esports try not to have their micro-transaction based services dictate actual gameplay. They want everyone to have a fair chance at success, and if micro-transactions are used, they are merely a bonus.

Possible Laws Are Coming

Suggested and follows suit of Belgian Gaming Commission that loot boxes constitute a form of gambling and circumvent laws.

The legislation points out that loot boxes and micro-transactions like it are the types of practices that target children, promote underage gambling, and exploit people. What is being proposed is the introduction of legislation prohibiting selling minors games that feature loot boxes.

Many point out that there is a slight difference between how the loot boxes work and the nuances of traditional gambling. For example, with slot machines, you are playing for the opportunity to win something or absolutely nothing. The concept of “all or nothing” applies.

Loot boxes, on the other hand, are guaranteeing that you get something no matter what. Similar to buying trading cards in the comic book shops, it is all just the luck of the draw whether you get a stupid pose or a valuable skin.

The whole loot boxes situation became inflated after Star Wars Battlefront 2 was released and there were supposed issues relating to itemization in the game.

They had items within the boxes that greatly impacted performance, and it became required that a player get them in order to compete.

Whether the practice was meant to be predatory or not, the outcome was that loot boxes got brought to the forefront of discussion. Legislation could have a dramatic impact on the esports world if it was to ever come into play.

If specific countries like the United States was able to get them banned, there could be problems for US-based companies. Companies like Valve and Blizzard Entertainment may face issues, because they utilize loot box style micro-transactions in many of their most popular titles.

Valve is headquartered in Washington and Blizzard in California, which means they may find themselves in a bit of a situation if said ban laws go into effect. It could have a dramatic impact on Blizzard especially, since their freemium game “Hearthstone” is heavily reliant on players buying digital card packs.

These card packs are considered loot boxes, and players need to buy them so that they can form their decks to battle against opponents. If a type of ban law were to come into play, the entire game would need to be reworked in how players are able to acquire their cards.

It’s a very good argument that underage gambling laws are being circumvented by allowing minors to purchase loot crates. The same could be said with trading cards, which get sold to very young children.

Strangely, no laws ever went after trading card companies for the practice of selling cards with the same concept in mind. They weren’t considered gambling, yet, when you look at the comparison of a loot box and a pack of trading cards, they seem quite similar.

Maybe the industry has just gotten too large, and the legislators want a bigger piece of the pie than they currently have. Only time will tell if the laws will make headway when going after the companies who utilize loot boxes, but it appears odd that now that video games are involved, they decide to act.

Potentials for Bettors

If loot boxes were to become outlawed, that would not only have an impact on the gaming developers and their bottom line, but also on the esports betting scene. Many people are heavily invested in the esports competitive betting market, and, like it or not, loot boxes are a big part of it.

Loot boxes themselves are utilized as a form of currency to put down bets and give people the opportunity to step their feet into the water without risking real money.

Loss of Skins Betting

Love or hate it, the skins betting market has been a huge part of the growth of competitive esports and has seen many different changes throughout the years. Currently, skins are still awarded randomly and come primarily from those loot boxes in titles such as Counter-Strike: Global Offensive.

Skins betting is technically against the terms of service of the companies who run the games, but the process operates on the third-party market. Technically, game publishers would need to cripple their product and disrupt their player base’s game atmosphere if they wanted to go after that market.

For example, Valve owns Steam, which is where games like CS: GO, and Defense of the Ancients 2 are played. The Steam marketplace is the backbone of the gigantic skins gambling industry, because third-party betting sites utilize the interface that it provides to upload their skins to the sites.

Whether Valve should or shouldn’t go after these third-party markets is up for debate, but frankly, their goal as a company appears to be providing a quality service to their consumers. Most of the high-end gaming companies have done exceptional jobs at providing that quality service.

If actual laws were to come into place that required companies like Valve to remove loot boxes from their games, it could dramatically impact how players can go about obtaining the skins that are used to bet on esports.

The betting market has many different people from all around the world involved in it, and many people use skins to bet because they do not see it as technical money. The market has grown hugely due to that fact, and if the skins market were to disappear, it could greatly impact odds and people betting.

Wrap Up

Outlawing loot boxes completely will be rather difficult to accomplish, because one country cannot set the standards for the rest of the world. However, it could become a difficult process and bog down gaming companies in problematic red tape.

Whether you think loot boxes are good or bad within the gaming community is a moot thing, because consumers should be able to make that choice, not laws. If loot boxes get outlawed, it could have a negative impact on the esports gaming community and possibly destroy great games.

Remember, as an esports bettor, you need to be aware of what is going on in the world, especially if any of your investments are within the skins market. You don’t want to be caught off guard one day if laws happen to impact you.

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