A new study forecasts that gamers will spend $50 billion on loot boxes and skin betting by 2022, with potentially serious consequences for a generation of young gamers.
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That figure represents a 60% market increase over the next four years, according to UK-based market specialists Juniper Research (via Dot Esports).
The study, titled Daily Fantasy Sports & In-game Gambling; Skins and Loot Boxes 2018-2022, claims that skin betting “should be of great concern to regulators” as currently the wagering of skins on third-party websites is creating an “unregulated gambling market.”
“Skins are acquired both through playing video games and from opening purchased loot boxes,” says Lauren Foye, the study’s lead author.“These items have value depending on rarity and popularity within game communities. On PCs, skins are traded for real money via Steam’s Marketplace; the platform has 125 million registered users globally.”
The research suggests Steam are reluctant to curb trades where users cash out, as they receive money from market transaction fees. Though Valve sent cease and desist letters to 23 Counter-Strike gambling sites back in 2016, Juniper say they still have not done enough when it comes to eradicating skin betting, and are allowing “significant gambling participation” to continue.
The study is especially concerned about how this trend willl affect young people. Juniper highlight the Gambling Commission’s 2017 study, which found that 11% of 11-16 year olds in the UK had placed bets with skins. This means over half a million children are susceptible to skin betting.
Juniper recommend regulation for skin betting to prevent the practice from being pushed underground, as well as “to prevent youth participation and remove malicious actors who run sites which steal skins or short-change users.”
The UK Gambling Commission have previously prosecuted skin betting sites such as FutGalaxy, for offering illegal gambling based on FIFA. In calling for regulation to nip the issue in the bud, Juniper’s emphasis is slightly different.