Twitch.tv, the popular live streaming website bought by Amazon for US$970mln in 2014, has announced a ban on unregulated gambling activity effective from October 18.

The move has been a long time in the making, given the ongoing criticism due to the site’s proliferation of predatory gambling companies.

Although Twitch has placed certain restrictions on gambling activity in the past, unregulated gambling sites have managed to circumvent them by registering offshore and using cryptocurrency as an on-ramp.

The majority of streams consist of streamers paying digital slot machines, though blackjack and poker is also popular.

In a statement posted on Twitter, Twitch said: “We’ll be making a policy update on October 18th to prohibit streaming of gambling sites that include slots, roulette, or dice games that aren’t licenced in either the US or other jurisdictions that provide sufficient consumer protection.

“The sites will include Stake.com, Rollbit.com, Duelbits.com and Roobet.com. However, we may identify others as we move forward.”

It’s a dramatic move for Twitch; while passively watching someone play slots for hours on end may sound like a waste of time to many, live streams can rack up millions of viewers.

‘Slots’ is the 10th largest category on Twitch (the platform is predominantly used for video game streaming) and though that rank has dropped in recent months, average viewerships are only going up.

At the time of writing, there are over 26,000 live viewers tuning into 134 channels, while the average viewership in the past seven days is over 54,000. Viewership numbers peaked this July at over 282,500.

Viewership and channel numbers continue to rise for Twitch’s ‘slots’ category – Source: twitchtraker.com

But the ubiquity of unlicensed gambling companies on Twitch has generated significant backlash from streamers and viewers alike, with popular content creators including Imane “Pokimane” Anys and Devin Nash demanding their removal.

Gambling and Twitch: A complex relationship

As this reporter has covered in the past, Stake, Roobet and others actively seek out and sponsor some of the top streamers on Twitch.

Although Twitch stated that it prohibits sharing links and referral codes, the reality is the platform has had trouble enforcing the ban.

I justifying the ban, Twitch said: “Some people circumvent those rules and expose our community to potential harm.”

It gets murkier from there; sponsors have been accused of flying streamers out to Canada and Mexico to live stream for days on end in order to circumvent US restrictions.

Back in July 2021, Wired reported that the gaming celebrity Richard Bengston, of publicly listed esports team FaZe Clan, alluded to such actions by his sponsor Roobets.

But if you think it’s just niche gamers getting in on the sponsorship action, you’d be wrong- Canadian rapper Drake became an official ambassador for Stake.com and has bet an estimated one billion dollars on his Twitch site StakeDrake as of August 2022.

The boy @Drake repping Stake at the Amsterdam premier party ???? pic.twitter.com/rby3FXp4oX

— Stake.com (@Stake) September 20, 2022

Following Twitch’s recent announcement, the partnership is in doubt, and all videos have been removed from StakeDrake.

Though it has not been proven, streamers have been accused of using ‘house money’ to play slots, thus eliminating any financial incentive to stop playing.

The tools of the trade are different, but the net outcome is the same- streamers and viewers alike are exposed to addiction risks that can lead to significant financial and mental stress.

Stake.com has been approached for comment.