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Competitive video games venture into gambling

A Vancouver-based company is set to release the world’s first betting book for video games using crypto-currency to avoid government…

By Konstantine Roccas , in Business Feature story , on November 24, 2014 Tags: , , , , , ,

A Vancouver-based company is set to release the world’s first betting book for video games using crypto-currency to avoid government regulation.

Play-for-Keeps hopes to legitimize what was once seen as a niche hobby by introducing organized betting using crypto-currency for competitive gaming.

“I played online poker to get myself through college and wondered how I could take that framework and apply it to video games without the legal issues, which is where my idea for a crypto-currency based betting book for e-sports came from,” said Ben Rees, founder of Play-for-Keeps.

But the idea of entrenching gambling as part of the video-gaming world has some professional gamers worried about the impact.

Bypassing regulation

All gambling in British Columbia goes through the gaming policy and enforcement branch of the Ministry of Finance. Rees understood that if he took a traditional approach to gambling, using real currency, he would run into several regulatory hurdles.

[pullquote align=right]The technology is new, so there is no person or organization to ask permission from right now[/pullquote]He decided to take a different approach to save himself the hundreds of thousands of dollars it would cost to be regulated by the government.

“Bitcoin was the saving grace. The regulators are years behind with regards to crypto-currency and the nerds have a huge advantage. It is difficult for regulators to even grasp this concept,” said Rees.

Bitcoin is a crypto-currency that has taken the Internet by storm in the past few years and has become a common currency of choice online.

Federal and provincial governments are still wrestling with the concept of its legitimacy as a currency.

While the federal government has attempted to regulate Bitcoin, there is no precedent for the authorities to intervene to when it comes to betting on video games with Bitcoin.

Because of this, Rees remains optimistic about the future and is taking a wait-and-see approach to any problems that arise.

“The technology is new, so there is no person or organization to ask permission from right now. It’s hard to get regulated for something that doesn’t exist. We just plan to build it and deal with the consequences as they come,” said Rees.

Competitive problems

There are already ways to gamble in video games. In DOTA 2, a game that pits a team of five against another team, a professional scene has grown to the point where multi-million dollar prize pools are becoming the norm. Professional teams play against one another and attract fervent followers on par with those in traditional sports.

As the game has grown, a betting system has arisen where viewers can wager digital items on the outcome of a professional match. Certain European-based sites exist that take online bets of real currency as well.

Many of these digital items maintain a real-world value due to their rarity, which has led to chaos in the professional scene.

Betting scandals have surfaced among professional teams where it was found that certain professionals were intentionally throwing matches to collect on bets they had made earlier.

Players have speculated that recent Distributed Denial of Service attacks targeting professional matches have been the result of disgruntled gamblers looking to influence the outcome of a match to collect on a bet.

DDoS attacks are when a server or machine is overloaded with digital information causing it to become unavailable to users.

Listen:
Ling: Betting scandals harm video games (1:10)

[audio https://thethunderbird.ca/files/2014/11/Aui_2000-On-Betting.mp3]

Kurtis Ling, a DOTA 2 competitive player, is wary of the impact gambling has had on the competitive scene but sees the positive effects it can have in the future.

“I think these scandals have overall hurt the integrity of (DOTA 2), but if we can get over these issues it will help in the future. I think people are into e-sports partly because they can gamble on it and doing so creates a sense of solidarity and promotes a better viewing experience.”

Emotional investment

For smaller but up-and-coming competitive scenes like Super Smash Brothers, a fighting game, the added interest that comes with gambling far outweighs the potential negatives.

There are fears that organised betting on games could be harmful.
There are fears that organised betting on games could be harmful.

The Smash community has been trending upwards in recent years and is starting to transition into the competitive realm, which has led to the inclusion of Smash in the Play-for-Keeps betting book.

The Vancouver scene has also benefited from Smash tournaments organized by Play-for-Keeps.

While not as large as the DOTA 2 competitive scene, Jake Turner, a competitive Smash player known as Firefly, recognizes the added attention that gambling can bring to Smash.

“I think that betting on games will help us more than harm us. Smash in particular. Maybe due to the fact that we have not had any major scandals, I think that the implementation of live-streaming and betting will add an emotional investment to viewers and will help grow the scene,” said Turner.

“We all benefit and I think that’s what Play-for-Keeps is aiming for.”

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