hose that work in the industry have been aware of eSports and their potential for online gambling for quite some time. A billion-dollar industry for several years now, it has been an area of steady growth, stemming from a somewhat niche market. Until 2020 that is.
This year, eSports has been catapulted into the mainstream. Due to current events over the last few months, it has gained significant interest not just as a spectator sport, but as something to bet on as well. Analysts predict that by the end of this year, it could see an increase of 17.2%.
We already know that 2.7 billion of the world’s population plays computer games for fun, but a growing percentage of these are playing competitively. For those that do, there are big, million-dollar prizes at stake. When there are competition and big money on the table, it’s only natural that people want to place bets.
Due to the pandemic, almost all global, traditional sports have ceased. It is not known when they will restart. Sports betting fans have been left with few options of what to bet on- this has left a huge client base with significant liquidity, without an output. Many sports betting providers registered a sharp decline in income, some have even closed. Others have been one step ahead of the game and have quickly brought in eSports betting to fill the void.
There are two main types of eSports betting — real money and skins. Real money is similar to traditional sports betting. Gamblers wager on the outcome, the score, or in-game events. Wagers are placed at agreed odds and a payout is made if the selection is correct. There are dedicated eSports gambling sites, but a growing number of sports betting platforms now offer eSports bets as well.
Skins betting is very popular in the established eSports community. Most eSports games have in-game virtual currencies and these items can be transferred between players. There are several sites where bettors and players can use these items to place bets on games and tournaments.
There are of course those that engage in social betting as well. These are informal wagers often occur between friends and online contacts. They bet on the same outcomes but do so without supervision. Typically they bet with cryptocurrency, fiat currency, skins, or in-game items.
The number of games where you can bet on the outcome is increasing. In 2019, the most popular game was League of Legends with prize money of almost $9 million. Fortnite, Dota 2, and CS:GO were also popular. 2019s biggest tournaments of these games attracted between 1.2 and 4.9 million viewers with maximum prize money of $64.3 million.
There are a number of other games that are growing in popularity with both gamblers and players. These include Apex Legends, PUBG Mobile, Free Fire, and Arena of Valor. These games enjoy viewership figures of between 525,000 and 39.9 million per tournament. If you consider these numbers and then think of the potential in terms of gambling, you begin to understand why eSports is a sector worth getting into.
We have worked with eSports betting clients for quite some time — both established betting companies and startups. But during Q1 and the start of Q2 2020, a huge uptick has been noted in inquiries from clients. Existing sports betting clients, noting the potential of eSports have been asking about licensing and compliance, and startups have been seeking to license in Curacao and the Kahnawake Nation.
Depending on the jurisdiction, those that already hold an online gambling license don’t need to apply for another license to offer eSports betting. Some countries do however require various administrative adjustments to licensing documents and business descriptions to do this. It’s best to seek professional advice on how to go about shifting into offering eSports betting. If you don’t, you might find yourself in trouble with your licensing authority. Those starting up from scratch should also seek licensing assistance to ensure all the requirements are met and complied with.
Reputable eSports betting sites used to be few and far between. Now, as the sector is moving more towards the mainstream, savvy entrepreneurs are catching on. As sports betting has temporarily declined, they want to retain customers while providing a high-quality product. They hope that when things return to some semblance of normality, eSports will remain an attractive betting option.
I am confident that it will. The world around us is changing and customers that would have previously not considered eSports betting are beginning to see its value. After following, betting, winning, learning about, and enjoying eSports it is unlikely they will desert it when traditional sports start up again. It could well be that the pandemic is the catalyst that the eSports industry needed to shift into the mainstream.