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Valve’s Legal Counsel, Liam Lavery, has responded to Washington State Gambling Commission inquiries into the legalities of Steam’s API and virtual items being used by third-party gambling sites. In the response, Valve refute all accusations of illegal activity.

“Valve is not engaged in gambling or the promotion of gambling, and we do not ‘facilitate’ gambling”, the letter claims. The company missed the initial deadline of 14 October given by the state gambling regulator, but did meet a promise to provide a response on 17 October instead.

Throughout, Valve’s stance is that they have taken realistic steps to prevent third-party gambling sites from exploiting aspects of Steam like OpenID authentication and virtual items/skins in games like Counter-Strike: Global Offensive. They point to a series of cease and desist letters sent in July to “over forty” skins gambling sites of which Valve was aware. The letter does not make note of how long Valve allowed the very same skins sites to go completely unchallenged.

Quite reasonably, they explain that aspects like virtual weapons are part of CS:GO (and other titles) and that it would be unrealistic, and groundless, for the WA Gambling Commission to insist that the whole structure of Steam trading be removed or turned off. “In-game items, Steam trading, and OpenID have substantial benefits for Steam customers and Steam game-making partners. We do not believe it is the Commission’s intention, nor is it within the Commission’s authority, to turn off lawful commercial and communication services that are not directed to gambling in Washington,” Valve’s response states.

The company express a certain willingness to co-operate with the Commission in tackling gambling, “if it [the Commission] is able to identify more skins gambling sites that are illegal in Washington State and the Steam accounts through which they operate”. Valve seem well aware how difficult this may actually be, however, writing earlier that “Cleverly designed bots can be indistinguishable from real users performing legitimate trades and techniques are constantly evolving”.

What happens next is hard to predict, because this is all previously uncharted territory. Third-party online gambling with legitimate virtual items is a relatively new development, and one which laws and regulatory bodies will take a while to catch up with. Valve keep claiming all innocence, but were demonstrably slow to respond to the growth of third-party gambling on the back of their games. The company only began to act with cease and desist letters after contact from the WA Gambling Commission (in February 2016) and at the height of the Trevor Martin/Tom Cassell YouTube non-disclosure scandal.

You can read the full text of Valve’s reply at TechRaptor.

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