BUSINESS

Valve restricts loot box key sales over money laundering concerns

TAGs: counterstrike, CSGO, loot boxes, money laundering, Valve Corporation

counter-strike-loot-box-keys-money-launderingVideogame developer Valve Corporation has restricted the use of certain in-game items in its Counter-Strike: Global Offensive title due to money laundering concerns.

On Monday, the CS:GO blog announced that keys sold within the game to unlock loot boxes “can no longer leave the purchasing account” and “cannot be sold on the Steam Community Market or traded.” The blog stressed that keys would continue to be sold via the game and the trading/selling ban didn’t impact pre-existing keys.

The blog explained that, until recently, “most” key trades involved “legitimate customers.” However, “worldwide fraud networks have recently shifted to using CS:GO keys to liquidate their gains. At this point, nearly all key purchases that end up being traded or sold on the marketplace are believed to be fraud sourced. As a result we have decided that newly purchased keys will not be tradeable or marketable.”

This is the latest black eye for Valve, which in 2016 was forced to crack down on third-party betting sites that used in-game virtual items known as ‘skins’ as gambling currency. Over $5b was reportedly wagered on these sites using skins in 2016, with Valve taking a cut of the proceeds derived from skin sales via its Steam marketplace.

The controversy led gambling regulators around the world to take a closer look at videogames and loot boxes, with many of these regulators coming to the conclusion that loot boxes featured the same type of reward mechanics as online casino games.

In July, CS:GO was singled out for criticism in a meeting between UK parliamentarians and the UK Gambling Commission for allegedly enabling kids to gamble via loot boxes. Valve has consistently denied that it engages in or facilitates gambling.

While there have been a few facepalm-worthy quotes from videogame execs regarding loot boxes, the industry is slowly copping to the fact that its wild west era is drawing to a close and its gravy train is rapidly running out of tracks.

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