Valve said it does not support illegal gambling and does not want to turn off services in its Steam platform.
Bellevue video-game maker Valve told Washington state regulators that it doesn’t support illegal gambling and is “disappointed” with the government’s ultimatum to shut down wagering tied to the company’s Steam platform.
The Washington State Gambling Commission director David Trujillo this month sent Valve Chief Executive Gabe Newell a cease-and-desist letter, ordering the company to immediately stop allowing the transfer of in-game items in illegal gambling activities. The company risked civil or criminal action should it fail to cooperate, the commission said, setting a deadline of Friday for the company to respond.
Valve missed that cutoff but replied in a letter dated Monday. Valve counsel Liam Lavery said Valve does not engage in, promote or “facilitate” gambling. “There is no factual or legal support for these accusations,” he said.
Valve’s Steam platform, an online game marketplace, and hit game “Counter-Strike: Global Offensive” have become hubs of activity in the shadowy world of gambling on competitive video gaming.
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Players can buy “skins,” or decorative in-game items for “CS:GO,” from Valve and trade or sell them to other players through the Steam platform, creating a sort of virtual currency. Enabled by gambling websites, skins wagering has grown into a multibillion-dollar business, industry observers say.
The gaming commission initially met with Valve to discuss skins wagering in February, the regulator said.
“Skins betting on e-sports remains a large, unregulated black market for gambling,” gambling Commissioner Chris Stearns said in a news release this month. “And that carries great risk for the players who remain wholly unprotected in an unregulated environment.”
In its response on Monday, Valve said it did not want to turn off the Steam services underlying the wagering, and that it was not in the commission’s authority to order the company to do so.
The company would prefer to take action against Steam user accounts tied to gambling, Lavery said, and would cooperate with the commission if it is able to identify sites that are illegal in the state and the Steam accounts they use.
In a statement late Tuesday, the gambling commission said it was reviewing Valve’s letter “to determine if it is responsive to our request.”