The new world of professional video gaming – esports – is bigger than you think. What was once a small gathering of enthusiasts who wanted to spice up their LAN parties with a little friendly competition is now a multi-billion-dollar industry with TV ads and mid-season transfers that match those in NBA. A 20-year-old gamer on a top-rated team can become a millionaire his first year.
With the global rise of esports, betting was sure to follow. Today it’s unimaginable to see a betting site without at least a small section dedicated to esports. Many of the biggest sites cover PC, console, and mobile games, offering an impressive variety of betting options.
The esports phenomenon has been responsible for rehabilitating the general public’s conception of video game players. No longer are gamers caricatured as pimple-faced basement dwellers sitting slack-jawed before their screens. They are actual athletes who exercise and mind their diets to shave milliseconds off their response times.
To think it all started with playing dress-up with toy guns.
Skins, Guns, and Lawsuits
The humble beginnings of betting on esports were rocky, to say the least. Many consider Valve Software’s video game Counter-Strike: Global Offensive the spark that started the fire.
Counter-Strike dates back to 1999 when it was a minor mod for Half-Life played by a handful of enthusiasts. It didn’t stay minor. By the time Valve launched CS:GO in the summer of 2012, servers were recording millions of active games and players every week. It was fertile ground for another experiment – gun skins.
Four years after CS:GO was launched, weapon color schemes, or skins, were introduced. Unknowingly, Valve opened up a Pandora’s box of unregulated skin gambling as sites raced each other to see who could make betting more enticing.
To get a skin for an AK-47 or another popular gun in the game, players had to be very lucky to get a random drop after a match. Or they could open up the crates by paying real money and hoping that Lady Luck would smile upon them and reveal a popular skin within.
Buying crates in hopes of a big reward looked and felt like gambling. It proved addictive. It’s no surprise that more and more sites started to add gambling features to games.
A gambling-based trading market appeared for skins. It worked pretty simply. Players visited a website and deposited their items. A roulette wheel would spin, picking one winner to take all.
It wasn’t long before an option to bet skins on professional CS:GO matches and leagues was introduced. Since the informal market determined the value of each skin, sites could use that information to give you credit based on your deposit. For example, if you sent an Asiimov AWP skin, you’d get about £70 in credit to bet on matches. Some CS:GO skins, especially those for knives, are worth hundreds, even thousands of pounds. Good players and bad players alike wanted a piece of that pie.
Enter CSGO Lotto and CSGO Lounge. These sites were among many that tarnished the history of esports betting when their owners were found to be rigging the system or conning customers in other ways. A lawsuit followed, demanding regulation of an emerging market where virtual items could be sold in exchange for real money. According to the suit, the unregulated companies running the existing sites facilitated money laundering and promoted underage gambling.
Many people wondered why gaming companies, whose games are central to the esports business, weren’t doing anything to control this new market. Parents worried that even games rated 3+ or “E for Everyone” would drag their children into gambling.
Regulation and the Rise of Esports Betting
The lawsuit and the subsequent cease-and-desist order that Valve issued to sites like OPSkins resulted in an upset in the esports world. Publishers and developers found themselves in uncharted waters.
Some of the leagues and tournaments drew massive crowds and cash prizes that dwarfed those in traditional sports. Advertisers and betting sites wanted to get into that world. But a game like FIFA couldn’t show ads for anything that wasn’t 100% family-friendly, unlike its real-world counterpart. It didn’t want to be known as a game that supported gambling.
But the betting snowball was already rolling down the hill. With skin betting gone and traditional betting sites seeking new revenue streams, esports betting was the logical next step.
It wasn’t long before betting shops and websites started offering punters an option to bet on Dota International, the most popular of the esports games at the time. League of Legends tournaments and CS:GO leagues soon followed, with fighting games like Street Fighter as an exotic alternative for adventurous punters.
The fact that one needed to go to an actual betting shop or website that already prevented underage people from betting turned out to be all the regulation the market needed.
Today, esports bookmakers create “esportsbooks” that are pretty similar to the betting resources they’ve used with traditional sports for decades. You can bet on the outcome of a match and on the outcome of each round if the game is round-based. Since video games have a lot of events with binary outcomes, in-betting has become extremely popular. For example, you might bet on the first kill in shooters or arena games, when a player might buy a specific item for his character, even the draft during the postseason phase of big leagues. And, of course, sports games like FIFA already have the exact same events as their real-life counterparts, so they are the easiest to adapt to this brave new world.
The growth of esports betting was mainly powered by sites that were already in the betting business. These sites were already regulated; they just needed to analyze the market so they could pick and choose esports that were the most attractive.
The gaming sites struck down by lawsuits ceased offering users betting opportunities or transitioned to the regulated betting market. Only a few tried to survive behind a veil in a kind of gray market.
Esports teams and leagues do not accept sponsorships from betting sites. They’re still concerned with maintaining their family-friendly images. But betting is not frowned upon as it was before.
The Future of Esports Betting Sites
This is a growing industry, raking in billions of pounds in bets each year. The future is surely bright.
Esports gained a boost in popularity during the spring of 2020 when the world was in lockdown due to the Covid-19 pandemic. Sporting events were cancelled across the globe as mass gatherings were temporarily forbidden. Even the 2020 Olympics were delayed to 2021. Millions of people confined to their homes turned to video games for entertainment.
Sudden interest in video games led to a rapid rise of esports betting too. Many leagues and tournaments didn’t require players to come to the venue – they could play from the safety of their homes. For a time, esports were the only sporting activities still broadcast, and a generation of punters jumped headlong into esports to try their skills at handicapping the fast-paced, epilepsy-inducing “vidja games” all the cool kids were playing. For the sites that were unprepared, that meant a mad dash to overhaul websites, calculate odds, and learn about esports leagues, matches, and tournaments.
All of this means that the esports market will continue to thrive as an essential component of betting sites. It has already positioned itself as a great source of revenue and new visitors, attracting an audience that might’ve never placed a bet if all they offered was football. As a bonus, esports are easy and inexpensive to add to a betting website. Gaming streams usually run through services like YouTube and Twitch. To add a live feed, you just use API code from those platforms and you’re in business.
It’s not all smooth sailing. You can grind an esports betting site to a halt by asking it to keep detailed statistics on all the competitors on all the teams in all the leagues. Accessing data about players’ performance, creating a sort of standard for processing that information… this all needs to be done before sites can claim they’ve overcome all obstacles.
And that’s not all. Like other unregulated sports, esports are subject to match fixing, cheating, and doping. Safeguards and governing bodies are not yet in place. An esports match can be disrupted by many factors, and conspiracy theories are already creating controversies that spoil what should be a fun pastime. Only after it has cleared these hurdles will esports, as a growing industry, reach its full potential as a betting event.