Crypto gambling livestreams to be banned from Twitch after $200K scam
Hot on the heels of a Twitch streamer confessing to scamming fans out of more than $200,000, the platform has announced it will ban all crypto gambling livestreams from October 18.
The Amazon-owned site said on Wednesday that after monitoring the situation for some time, certain gambling firms will be forbidden as they “aren’t licensed either in the US or other jurisdictions that provide sufficient consumer protection.”
“We’ll be making a policy update on October 18th to prohibit streaming of gambling sites that include slots, roulette, or dice games,” the statement posted on Twitter read. Twitch specifically mentions gambling sites Stake.com, Rollbit, Duelbits, and Roobet but says it may identify more in the coming weeks.
“We will continue to allow websites that focus on sports betting, fantasy sports, and poker,” Twitch stated.
Read more: Crypto trading hamster outperforms Bitcoin, Warren Buffett, Cathie Wood
Twitch crypto gambling has caused massive losses
As reported by Bloomberg, Twitch’s recent rise in gambling livestreams has led to addiction for some and alarming debt for others.
Gambling outfits like Curacao-based Stake.com sponsor popular streamers — and celebrities, like rapper Drake — several millions of dollars a month to crypto gamble in front of fans on Twitch.
Stake’s intense marketing strategy seems to have paid off. Viewers were getting hooked, deciding to get into the action themselves. But unlike the streamers they were watching, their losses weren’t being absorbed by ludicrous sponsorship deals.
“Once the initial excitement of seeing someone play with such huge sums wore off, it was mostly off-putting and made me sick watching it,” one gambler told Bloomberg. “It also gave viewers a false sense of winning and losing.”
$200K scam leads to Twitch streamer protests
Last weekend, a Twitch streamer called Abraham “Sliker” Mohammed confessed to scamming friends and fans out of over $200,000 to pay off his gambling debts. Mohammed would borrow money and lie about where it was going to pay for an addiction that began by trading Counter-Strike skins.
Many popular streamers responded to the scandal by threatening to leave Twitch if the platform didn’t ban or regulate gambling. A few days later, Twitch announced on Twitter it would prohibit the activity.
Read more: Here’s how insiders are getting rich off the Ethereum Merge
Crypto gambling is currently illegal in the US but the rules are less strict in Canada. While spokespeople for Stake told Bloomberg it takes stringent measures to prevent VPNs from being used to circumvent country restrictions, reports indicate they may not be effective.
Stake also said it “uses a number of measures to address at risk gambling behaviour,” even giving out free software that blocks gambling.
For more informed news, follow us on Twitter and Google News or listen to our investigative podcast Innovated: Blockchain City.