The head of the UK Gambling Commission called skin betting sites “parasites” and will take steps to shut them down, according to a recent media report.

What the UKGC said on skin betting

According to Gambling Compliance (paywall), UKGC CEO Sarah Harrison isn’t going to sit idly by if unlicensed skin betting sites try to operate in the country without a license:

“They are parasites off the back of well-established gaming platforms,” she said.

“Adopting a Whac-A-Mole strategy may not be the most effective way of tackling the problem. Our strategy is to attack these businesses from every angle, to isolate and starve them.”

The unlicensed skin betting industry already faced a crackdown from game publisher Valve, whose most popular titles include Dota 2 and CS:GO. Last year, Valve issued cease-and-desist letters to many of the most popular sites.

The UKGC on skin gambling in the past

UK’s gaming regulators have not been fans of skin betting operators without a license. But they have said that such operators can receive a gambling license in the country, and that the industry should face regulation. Operators have not chosen that route, however.

In a white paper called earlier this year, the UKGC touched on the subject. “Gambling on esports with in-game items is growing and we need to make sure all gambling is fair, safe, crime-free and protects the young and vulnerable,” Harrison said at the time.

The UKGC wrote in the paper that skin gambling is clearly an activity that requires licensure in the UK. It also stated its preference that game developers, like Valve, take responsibility in trying to stop the industry:

“However, we are strongly of the view that the video games industry should not be, or perceived to be, passive to the exploitation of their player community by predatory third parties. The significant risk of harm posed by these unregulated gambling websites, whilst unintended, is nonetheless a by-product of the manner in which games have been developed and in-game economies incorporated for commercial benefit.”

Beyond that, the commission did not outline what steps it would take to attempt to stop skin betting.

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Other jurisdictions and skin betting

The topic of skin betting has not been a major topic of concern for most gaming regulators. Still, it has garnered some attention:

• Washington state told Valve to take steps to stop the use of skins on its games for skin betting.
• The Isle of Man developed a license to specifically cover esports and virtual goods. It issued the first one this month to a site, eSportsPools.
• Norway’s gaming regulator threatened action against skin betting operations.
• The Malta Gaming Authority has signed up to work on matters related to esports betting and game integrity, but there has been nothing concrete on its plans (if any) as it relates to skin betting.

The UKGC’s threat appears to represent the most attention any regulator will pay to the skin betting industry.