Regulation of Loot Boxes Is Good For Australia

If you’ve been paying careful attention to gambling news in Australia lately, you know loot boxes are under heavy scrutiny. Lawmakers are beginning to examine whether that loot boxes should be regulated, and other community organizations are speaking out against loot boxes as gambling.

The average gamer may not understand the big deal behind loot boxes. However, the reality is that this gaming mechanism does closely represent gambling. Today, let’s dive deeper into loot boxes and discuss why regulation is good.

Loot Boxes Explained

If you’re not a gamer, you may not understand the concept of a loot box. In many online games, loot boxes are used to award items to players. These items vary greatly and depend on various factors. Generally, a loot box will award items based on how far a player is in a game.

The average loot box will award items like coins, armor, weapons, and experience points (XP). Loot crates can be awarded in various ways. Players may receive boxes upon completion of levels or quests. Others can be purchased for either game currency or real money. Finally, these boxes can be part of daily rewards.

Loot Crate Results

Where lawmakers and parents are becoming concerned about loot boxes is how prizes are awarded. Generally, loot boxes award prizes randomly and based on odds. Lower-importance items typically have a much higher percentage of being awarded than more powerful items. This is similar to a random draw, such as Keno.

Then you have loot boxes that are presented like gambling games. The most popular way to do this is through a spinning wheel. Like Roulette or Big Wheel, the wheel has numbers or prizes on each section of the wheel. Where the wheel stops determine the prize awarded. Higher-value prizes have fewer slots on the wheel than lower-value prizes.

In many games, players can purchase loot crates for real currency. This is effectively spending money to take a chance on winning an item. Many view this as another form of gambling, similar to social casinos.

What Lawmakers Are Proposing

Lawmakers want to regulate loot boxes as they would real money online gambling. Some countries have already enacted regulations against these mechanisms. Japan, China, and Belgium all have laws against loot crates. The Netherlands is the most recent country to ban the popular mechanic.

Regulating loot crates would make it illegal for gaming providers to offer the mechanism to Aussie players. If this happens, a large number of games may choose to stop serving the region. This could drastically change the landscape of online gaming in the area.

Many games use loot boxes, including games targeting young children. For example, look at the simple game of Bot Clash on Roblox. This game has many loot crate-style mechanisms available, and much of the game centers around using these mechanisms to upgrade bots. These games would no longer be available to children if boxes were regulated.

Are There Alternatives?

There are multiple alternatives that gaming companies could take over the use of loot crates. Some games allow players to purchase upgrades directly. For example, The Walking Dead No Man’s Land will enable players to buy power-ups directly. Instead of playing a gambling game to win items, players pay a set price for items.

Alternatively, some games award prizes for completing levels. For example, completing level two of a game may award a Level 5 armor piece. These direct rewards would not be gambling and would allow game developers an option to continue operating in Australia.

Regulation of Loot Boxes is a Good Thing

Ultimately, we believe that regulating loot boxes is good for Australia and other parts of the world. If you have ever played games that offer the mechanic, it is clear that the boxes are a money grab. Often, players have to spend crazy amounts of money for the chance to win an item. This is clearly gambling and something that young people do not need in their lives.

We would much rather see a direct pricing method for power-ups for games. This allows players to control how much they want to spend on a game. Gaming companies can still produce a lot of income by creating upgrades but will do so in a way that is much more socially responsible than the current loot crate system.

Rose Varrelli avatar
Rose Varrelli
Senior Casino & News Writer

Hi there! I’m Rose, and with nine years behind me in the iGaming industry, I craft engaging narratives at CasinoAus. My education in Communication across Europe has sharpened my skills in fintech, casino legislation, and digital marketing. Backed by a strong foundation in SEO, storytelling, and cross-cultural communication, I’m passionate about creating content that resonates globally and educates our audience.

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