CSGO Lounge, the top Counter-Strike skin betting site, has announced that they plan to comply with Valve's CSGO gambling cease-and-desist letter by obtaining an actual gambling licence. Problem: That's not the reason Valve sent the letter in the first place. In a statement on the site, CSGO Lounge's founder explained:
After all the recent events around virtual items and the official letter by Valve, which we have received as well, we were left out alone without any additional information or communication by Valve on this matter. We had to make a decision on how to proceed with Lounges as community place and entertainment service. The situation is highly confusing - we are not offering games of luck, we are not offering any transactions with real money or equivalents.
Despite those facts, in order to avoid or reduce the confusion, we have decided to acquire a licence to legally operate in most of the countries and be able to accept the esports bets by our community, as if it would be real money.
He added that the site will also comply with gambling laws in various countries by limiting access in places where it's forbidden. "Users from the following countries and regions will not be able to use the betting feature, but still be able to withdraw their previous winnings and deposits: Belgium, France, French Guiana, Guernsey, Gibraltar, Ireland, Isle of Man, Jersey, Martinique, French Polynesia, Reunion, Mayotte, Turkey, Spain, Scotland, Israel, United Kingdom and United States," he wrote.
The problem, however, is that Valve's cease-and-desist letter never mentioned gambling laws or lack of adherence to them. Valve specifically took aim at sites using Steam accounts to conduct business. "Under the [Steam Subscriber Agreement] Steam and Steam services are licensed for personal, non-commercial use only," Valve wrote.
CSGO Lounge insists that items in games like CSGO and DOTA 2 are not equivalent to real money, but you need only go as far as the Steam Community Market to see that they have authentic value. Sure, Valve keeps a lot of that money in a constrained ecosystem, but that doesn't mean it's not real. Further, while CSGO Lounge's founder claims they have always acted "without any profit interest", the fact remains that their site is plastered with ads, which doubtless bring in money (web traffic ranks CSGO Lounge among the top 700 sites in the world). Never mind their sponsorship deals with YouTubers and even an eSports team.
So it sounds like CSGO Lounge is trying to treat a symptom of the larger CSGO skin betting disease and hoping that will somehow address the one that's gonna put them out of business. Getting a gambling licence with the express intent of treating skin betting like real money gambling only further muddies those waters. I sincerely doubt CSGO Lounge's plan will work, given that if Valve doesn't put its foot down here, the floodgates will be wide open again.