04: Beyond the Bet: Possibility of a Gambling-Free Esports World?

Have you ever wondered what would happen if all games, leagues, and franchises within esports suddenly decided to ban all gambling and betting sponsors? While such a move would undoubtedly result in a cleaner, more transparent esports ecosystem—addressing integrity issues like match-fixing—it would also come with significant consequences. Gambling and betting sponsors currently contribute around 5-10% of total esports sponsorship revenue globally. In certain regions, particularly in Eastern Europe and within lower-tier leagues, this figure could be as high as 15-30%. Removing this revenue stream would create a substantial financial gap, forcing the industry to explore new avenues for funding and sponsorship.

How did it all begin?

One of the earliest forms of gambling and betting in esports emerged from CS: GO, where players began trading in-game weapon skins that eventually acquired real-world monetary value. This phenomenon gave rise to the “skin-gambling” industry, which, as of 2024, is estimated to be worth between $10 to $15 billion. Much of this industry's growth can be attributed to unregulated third-party websites that allow users to gamble on these virtual items.

In recent years, leading gambling websites like GG.bet, Betway, Rivalry, 1xBet, Loot.bet, and CSGOROLL have invested millions into prominent esports organizations such as Natus Vincere, Team Spirit, G2 Esports, Ninjas in Pyjamas, BIG Clan, and others. These platforms have also served as major sponsors for some of the biggest esports events, leagues, and franchises, including the ESL Pro League, DreamHack Masters, BLAST Premier, PGL Major, StarLadder tournaments, and countless regional esports competitions.

The gambling and betting industry is deeply ingrained in esports, from CS: GO to titles like Dota 2, League of Legends, Fortnite, Valorant, Rainbow Six Siege, and more. These games offer betting or fantasy services for matches, with some even hosting a thriving skin-gambling scene. However, this involvement raises serious ethical concerns, including match-fixing, underage gambling, and the regulation of betting platforms. As esports continues to grow, striking the right balance between economic growth and ethical responsibility will be crucial in shaping the future of gambling in the industry.

What if, Nothing changes in the future?

The future of gambling and betting in esports, if left unchecked, presents a double-edged sword. On one side, it provides essential revenue streams that fuel team growth, tournaments, and global expansion, particularly in underfunded regions and lower leagues. On the other side, it brings significant ethical and reputational challenges, including match-fixing, underage gambling, and a dependency on a controversial industry. As governments and regulators increasingly scrutinize gambling’s role in esports, the risk of legislative crackdowns grows, potentially destabilizing revenue models reliant on these sponsors. Additionally, the heavy association with gambling could alienate mainstream brands and fans, hindering esports' pursuit of legitimacy and widespread acceptance. Balancing economic growth with ethical responsibility will be crucial to ensuring a sustainable and credible future for esports.

What if, Esports gambling and betting are banned?

Even hypothetically, a global ban on gambling and betting sponsorships in esports seems unlikely in the foreseeable future, given the industry’s heavy reliance on these investments. Without this funding, Tier-2 and grassroots esports scenes, which depend heavily on such sponsorships to survive, would likely face collapse. For instance, Valorant’s recent decision to allow betting sponsors underscores the economic importance of this revenue stream. Similarly, Coffeezilla’s in-depth investigation into the underground black-market gambling scene in CS: GO concluded that Valve bears significant responsibility for enabling it. However, Valve’s ability to intervene is constrained, as any drastic action could disrupt the game’s economy and potentially cost the company billions of dollars each month.

A global ban would fundamentally reshape esports, forcing teams and tournaments to confront severe financial challenges while seeking alternative revenue sources. Eliminating gambling sponsors could enhance the industry’s reputation and address ethical issues like match-fixing and underage gambling, but it would also leave significant funding gaps, especially in smaller leagues and underdeveloped regions. This vacuum might encourage greater involvement from mainstream, non-endemic brands, but the transition would be slow and uncertain. In the short term, the scale and quality of events could suffer, making it imperative for the industry to balance financial sustainability with integrity and credibility to secure its future.

India’s Corner

The legal status of gambling in India is complex. While sports betting remains illegal in most parts of the country, some states like Goa and Sikkim have more lenient regulations. As in other regions, the rise of gambling sponsorships in Indian esports has raised concerns related to match-fixing, addiction, and underage gambling. These concerns are especially prominent in the context of mobile esports, where young, impressionable players may be more vulnerable to the allure of gambling.
Indian esports has seen a rise in gambling and betting sponsorships, particularly in popular titles like PUBG Mobile, Free Fire, and Valorant. Betting websites and platforms targeting Indian audiences, such as Betway, 1xBet, and Parimatch, have started to form partnerships with both esports teams and major tournaments.

The future of gambling and betting sponsorships in Indian esports will depend heavily on how the legal landscape evolves. If stricter regulations are enforced, gambling sponsors may find it difficult to continue their partnerships with Indian esports organizations. Alternatively, if the government legalizes or regulates esports betting, the market could expand, allowing for more legitimate and transparent sponsorships.

A Likely Scenario..

The future of gambling and betting sponsorships in esports will likely be shaped by a combination of increasing regulation, evolving public perceptions, and the industry's reliance on these sponsorships as a key revenue stream. In regions with stricter gambling laws, sponsorships may face more scrutiny or outright bans, pushing organizations to diversify their funding sources. However, in areas with lenient regulations, gambling sponsors will likely continue to dominate, especially in Tier-2 and emerging markets where other sponsorship opportunities are limited.

At the same time, the industry may see a shift toward greater transparency and responsibility from gambling companies, driven by public pressure and the need to mitigate ethical concerns like match-fixing and underage gambling. Some esports organizations might proactively reduce their dependency on gambling sponsorships to attract mainstream brands and maintain a cleaner image, but the transition will be gradual and uneven. Ultimately, the balance between economic necessity and ethical responsibility will determine the long-term role of gambling and betting sponsorships in esports.