New York sues Valve for promoting illegal gambling via game loot boxes

Bleeping Computer

by Sergiu Gatlan

February 26, 2026

AI-Generated Deep Dive Summary

New York Attorney General Letitia James has filed a lawsuit against video game giant Valve Corporation for using loot boxes in games like Counter-Strike 2, Team Fortress 2, and Dota 2 to facilitate illegal gambling, particularly among children. The lawsuit claims that these mechanisms, which offer random virtual prizes exchangeable for real money, resemble slot machines and violate New York's gambling laws. With Steam, its platform, hosting over 29 million players globally, Valve has allegedly profited significantly by exploiting these features, with the total value of in-game items estimated at $4.3 billion as of March 2025. The Attorney General highlights that the odds of obtaining rare items are skewed to increase their perceived value and scarcity. This practice not only drives excessive spending but also makes Steam accounts targets for hackers due to the high monetary worth of certain items, such as weapon skins fetching over $1 million. The lawsuit emphasizes the potential harm to children, who may develop gambling addictions influenced by loot box mechanics designed to be addictive. From a security perspective, the rise in valuable virtual assets has increased vulnerabilities to hacking and scams. The case also references a recent FTC settlement with Genshin Impact's developer for similar issues, underscoring broader concerns about the marketing of loot boxes to minors. James seeks to halt Valve's loot box operations in New York, recover profits, and impose fines, aiming to protect consumers from what she deems illegal and harmful practices. This legal action underscores the intersection of gaming culture, gambling laws, and cybersecurity risks. As virtual economies grow more complex, so do the challenges in safeguarding users from exploitation and digital threats linked to in-game purchases. The case highlights the need for regulatory scrutiny to balance innovation with consumer protection,

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Originally published on Bleeping Computer on 2/26/2026