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\u00a0 \u00a0 \u00a0The real goal is regulation, and saving eSports from itself.<\/p>\n\u00a0 \u00a0 \u00a0The real goal is regulation, and saving eSports from itself.<\/p>\n
Betting on other people playing video games is different from betting on other people playing football, in one major respect: The National Football League oversees the game to the point where it checks the air pressure in footballs.\u00a0 There is no equivalent organization with eSports.<\/p>\n
Even the games are owned by companies.\u00a0 Every few weeks, they change the game.\u00a0 Could betting on football be regulated if the owner of the entire game were to arbitrarily change the shape of the ball every week?<\/p>\n
The Nevada regulators had, somewhat reluctantly, allowed Nevada-licensed bookmakers to take heads-up betting on eSports.\u00a0 Accepting wagers on \u201cother events\u201d has been permitted for decades.\u00a0 In fact, state regulators have had to close down betting on events like the Oscars.\u00a0 Someone from PricewaterhouseCooper put those names into those sealed envelopes, including the one opened by Warren Beatty.\u00a0 A tougher problem developed with the TV show \u201cSurvivor.\u201d\u00a0 Viewers could bet on the outcome; but, reality shows are at least partially scripted.\u00a0 Normally, the worry is that insiders will place bets on event outcomes that have already happened.\u00a0 But would it be a crime if the producer of a reality TV show bet on his favorite contestant and then rigged the show so she won?<\/p>\n
Which brings us to eSports.\u00a0 It would have been politically embarrassing if regulators had said that you can\u2019t trust eSports events to be run fairly.\u00a0 Nevada regulators allowed parimutuel betting on jai alai.\u00a0 I remember watching a game in the MGM Grand\u2019s fronton.\u00a0 A great sport to watch.\u00a0 But not one generally thought of as a model of self-regulation.<\/p>\n
Maybe most importantly, Nevada has declared how eSports betting will take place from now on: parimutuel pools.\u00a0 This is important because it will eventually eliminate a major eSports\u2019 problem: The betting of skins.<\/p>\n
Skins are avatars.\u00a0 A player can win, or buy and sell on secondary markets, a skin that will make his weapon look fantastic.\u00a0 But the weapon\u2019s strength remains the same; the change was only electronically skin deep.<\/p>\n
The money, however, is real.\u00a0 Players are buying and selling skins for hundreds of dollars.<\/p>\n
Most eSports wagers use skins as currency.\u00a0 But the secondary markets, in fact, the very idea that skins are worth anything, is based on artificial shortages in artificial markets.\u00a0 For those who don\u2019t remember, here\u2019s a link to \u201cBubble bursts on Beanie Babies,\u201d http:\/\/old.seattletimes.com\/html\/businesstechnology\/2002020751_beaniebabybubble31.html.\u00a0 There are a lot of people who still hate Beanie Babies.<\/p>\n
A lot of Millennials are going to lose a lot of money when the eSports skins bubble bursts.\u00a0 Nevada\u2019s regulators deserve credit for forcing the elimination of skins betting, before it got even bigger.\u00a0 Parimutuel betting does not work with skins.<\/p>\n
The Nevada gaming\/entertainment industry has already invested real money in the expectation that eSports will draw Millennial fans to its restaurants, shops and casinos.<\/p>\n
So, Nevada regulators have publicly announced that eSports is an industry whose integrity can be trusted . . . but only if the Nevada regulators say so.<\/p>\n
Expressly allowing parimutuel betting will greatly increase the amounts wagered.\u00a0 Even the announcement garnered attention.<\/p>\n
Gaming regulators do not have any direct power over eSports events.\u00a0 But they have absolute control over the state-licensed sports books.\u00a0 As of July 1, 2017, books will be able to operate sports pools on any \u201cother event\u201d that has been approved by Nevada regulators.\u00a0 But there are requirements.<\/p>\n
First, everyone has to agree on when the game is over.\u00a0 A \u201clicensed sports pool shall not accept a wager on an event unless the date and time at which the outcome of the event is determined can be confirmed from reliable sources satisfactory to the chairman or from records created and maintained by the book in such manner as the chairman may approve.\u201d<\/p>\n
Then, regulators put the entire burden of controlling eSports on the one party they have power over:\u00a0 the sports book.\u00a0 The books, will, of course, pass the burden on to the eSports event organizers.<\/p>\n
The new rule requires that the sports book has to provide \u201csuch other information or documentation which demonstrates that:<\/p>\n
(1) The event could be effectively supervised;<\/p>\n
(2) The outcome of the event would be verifiable;<\/p>\n
(3) The outcome of the event would be generated by a reliable and independent process;<\/p>\n
(4) The outcome of the event would be unlikely to be affected by any wager placed;<\/p>\n
(5) The event could be conducted in compliance with any applicable laws; and<\/p>\n
(6) The granting of the request for approval would be consistent with the public policy of the state.\u201d<\/p>\n
It is a rather brilliant move.\u00a0 Nevada regulators get to set all of the standards, pretty much for the entire world.\u00a0 And they don\u2019t have to do any of the actual work.\u00a0 There\u2019s nothing wrong with this; I don\u2019t think we really want Nevada gaming regulators to oversee professional football games.<\/p>\n
Instead, they have said to the bookmakers, \u201cBetter get everybody together and figure out a way to create an eSports-NFL.\u201d<\/p>\n