Should Video Game Loot Boxes Be Regulated Like Casinos? British House Of Lords Think So

  • Britain’s House of Lords has stated that videogame loot boxes should be regulated under the same laws that affect casinos.
  • Reports show that people who purchase loot boxes have an increased chance to have gambling problems in the future.
  • Video game companies like EA have argued against loot boxes being gambling.

LONDON, U.K.- The legality of video game loot boxes argument has gotten to a peak with the British House of Lords now calling for the practice to be held to the same legislative standards as casino gambling.

Video game loot boxes are when a game offers random prizes for a certain amount of money. Although these boxes can be obtained by playing the game, the argument comes from the ability to purchase these random rewards with real money.

This has been a growing issue in the gaming market as a whole as legislators from all over have compared loot boxes to casino slot gambling.

Are Loot Boxes Gambling?

There has been a constant debate as to whether or not videogame loot boxes should be considered a form of real money online gambling due to the three components associated with gambling.

The first being an entry fee, followed by the transaction of real money, and finally being the game of chance.

By these standards, loot boxes could be categorized as gambling. Not only that, but studies have shown than loot boxes lead to future gambling problems.

The British House of Lords has joined in on the fight against loot boxes, pushing for legislation to be made that would categorize loot boxes as gambling, making it illegal to operate in videogames without regulation.

"Loot boxes, for some, are almost a tutorial in gambling," said Lord Grade, chair on the House of Lords Gambling Committee. “It's a game of chance: you pay your money and it is a gamble. Technically they don't come under the legal definition of gambling but we think they should be regulated."

Lord Grade's views are not unfounded. A study was done in 2019 at Rutger University which found the direct link between loot boxes and gambling.

The study showed valid evidence that young people who are exposed to loot boxes in video games are likely to become gamblers when they get older.

“Forty-six percent of those who played video games also bought loot boxes, and among the loot box players, they were significantly more likely to also have gambling problems and-or problems with video gaming, ” said Lia Nower, Rutger Universities Center for Gambling Studies director.

Major gaming companies have consistently denied the accusations and countered the argument that loot boxes are indeed gambling.

During a June 19 hearing, mega gaming publisher EA, creators of the FIFA videogame franchise, defended the use of loot boxes as being ethical.

“It's something that's been part of toys for years, whether it's Kinder Eggs, or Hatchimals, or LOL Surprise,” said Kerry Hopkins, Vice President of legal and government affairs at EA. “We do think the way that we have implemented these kinds of mechanics ... is actually quite ethical and quite fun. Hopkins added, "We think it's like many other products that people enjoy in a healthy way, and [customers] like the element of surprise.”

It does make sense for companies like EA to want to defend and maintain the status quo of loot boxes.

The mega-publisher grosses nearly $1 billion a quarter strictly from revenue from loot boxes and other microtransactions.

It is as of yet unknown if any official action will be made, as this is not the first attempt to attack loot boxes.

If loot boxes are officially considered gambling in the U.K., then that may bode an interesting trend that could possibly affect US online gambling laws.