NY AG: Valve's loot boxes can get kids hooked on gambling
Source: Engadget
Background
New York Attorney General Letitia James has accused Valve of promoting illegal gambling through its video games in a lawsuit filed by her office. According to the AG’s announcement, the investigation concluded that Valve enabled gambling by enticing users to pay for a chance at rare items from loot boxes in Counter‑Strike 2, Team Fortress 2, and Dota 2. The lawsuit stresses that Valve’s loot boxes are “particularly pernicious” because the games are popular among children and teenagers.
Details of the Lawsuit
The complaint describes the loot‑box model—requiring a player to open a mystery chest for the possibility of winning rare items—as “quintessential gambling.” It cites research indicating that early exposure to gambling significantly raises the risk of developing gambling addictions later in life. The suit also notes that most forms of gambling are illegal in New York.
- Players must purchase chests or boxes and the keys needed to open them.
- Valve has reportedly sold billions of dollars’ worth of keys for Counter‑Strike alone.
- The lawsuit states that Valve has earned tens of millions of dollars in fees from the sale of virtual items on the Steam Community Market.
- In addition to selling items for funds credited to a Steam Wallet, players can also sell them on third‑party marketplaces for cash.
Valve’s Response
According to the AG’s office, Valve facilitates and even assists third‑party marketplaces in their operations. Engadget has asked Valve for a comment but has not received a response. Previously, Valve denied involvement with third‑party sites that allow sales of its game items for real‑world money. In a reply to the Danish Gambling Authority, Valve explained that those sites create sock‑puppet accounts to trade items on Steam for cash, a practice that “violates our terms of service.”
Market Impact
The lawsuit highlights the massive market for Counter‑Strike skins, referencing a Bloomberg article from 2025 that reported the market had surpassed $4.3 billion. As an example, it cites the 2024 sale of a Counter‑Strike 2 AK‑47 skin for $1 million.
Legal Demands
The Attorney General’s Office seeks a court order to:
- Stop Valve from violating New York laws.
- Compel the company to surrender money it allegedly earned from illegal activities.
- Impose a fine three times the amount earned from the purported illegal business practices.