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Lords of War: The gunrunners of Counter Strike: Global Offensive Exclusive
Lords of War: The gunrunners of  Counter Strike: Global Offensive
March 11, 2014 | By Mike Rose

March 11, 2014 | By Mike Rose
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    4 comments
More: Console/PC, Business/Marketing, Exclusive



As more developers consider real-money transactions and user-driven marketplaces, virtual "gunrunners" have already been cutting deals inside and outside Counter-Strike: Global Offensive's official channels. Gamasutra's Mike Rose reports.

"There are over 550 million firearms in worldwide circulation. That's one firearm for every 12 people on the planet. The only question is: How do we arm the other 11?" - Weapons dealer Yuri Orlov.

de_dust2 -- the mainstay map in the tactical first-person shooter franchise Counter-Strike -- has evolved over the years, but war never changes. There will always be terrorists looking to plant the bomb, and there will always be counter-terrorists to stop them. This is a certainty, and if anything, war is more popular than ever: every day hundreds of thousands of people commit to an hour or two of Counter-Strike in its various forms.

But the latest installment, Counter-Strike: Global Offensive, is more than just spit, polish and streamlining. This installment introduces an online weapons marketplace -- a nice distraction for the Counter-Strike dabbler, and a Pandora's Box of opportunity for the hardened, determined gambler.

It goes a little something like this: Weapons can be acquired through playing the game, paying to open "weapons cases," buying them through the marketplace, or trading with other Steam users. The amount that people are paying for weapons determines weapons' value, and special graphs associated with each weapon show you at a glance how much you can expect to buy or sell them each for.

csgo1.jpgMuch of the weapon trading within CS:GO is done by the book, with market owner Valve taking its 15 percent cut of the revenue. But as is always the case when opportunities like this arise, there's also a seedy underbelly oozing with risky arms trafficking and under-the-table deals -- a world that Valve simply cannot control.

There are a number of different hangouts for CS:GO gunrunners. Most congregate around the CS:GO Lounge, a third-party trading website which allows soldiers to list their potential trades, check out what anyone else is offering, and then conduct their business. Another popular spot is the /r/GlobalOffensiveTrade Reddit forum, which works in very much the same manner.

Is it all above board, then? Like hell it is. Traders regularly contact each other with PayPal or bank details, in a bid to keep that 15 percent Valve cut firmly in their pockets. The problem is that trades done outside of the Steam platform are a risky business, and often turn sour -- sometimes money exchanges hands, but weapons are never traded, and the inexperienced are often rinsed dry.

There are many players in the Counter-Strike gunrunning game. Over the course of the last month, I've hunted down several such people, ranging from relative newbies to the scene, to big-name veterans who have made quite the name for themselves. If you thought Steam trading made for a safe environment, you may have changed your mind by the time we're through.

The first and most important rule of gun-running is: Never get shot with your own merchandise.

Most gunrunners start off with just a small amount of cash in their pocket, and multiply that by many factors. One such trafficker told me of how he started with $60 in his Paypal account, and slowly but surely built this up via Reddit trading.

"I found someone selling a bayonet for $60," he tells me. "Around the same time I discovered CS:GO Lounge, where I now do most of my trading. I try to factor things in other traders sometimes don't -- the biggest of which is demand."

Expensive AKs are in higher demand than knives, he reasons, and so he'd always try to play the market to his more immediate advantage. Leaving personal preferences at the door is also key - just because you think that red stripe on a knife looks cool doesn't mean it's going to sell for more. And it's always good to have a handful of low-value skins to add to a deal, simply to convince your trade partner that you're worth dealing with.

This particular runner's game goes as follows: Start with a lower price weapon like the bayonet, and keep trading for something that you know is going to be worth slightly more. Once you've got a few hundred dollars worth of gear in your Steam backpack, cash it out via a PayPal trade.

"I recently cashed out $300 via PayPal," he notes. "I spent a few days looking for a guy with rep who would agree to my terms, and it all went well. PayPal trading can be very risky though, and I wouldn't recommend it unless you have a few months of experience."

Another weapons smuggler tells me that gambling is a huge part of the CS:GO gunrunning experience, and once you grow accustomed to it, can put you at a huge financial advantage. Some betting occurs within the game, as you pay small amounts of cash to open weapons cases that could potentially contain an expensive, rare weapon... or quite the opposite. However, there's also a whole additional level of gambling that's hiding below the surface.


"Paypal trading can be very risky, and I wouldn't recommend it unless you have a few months of experience."
Bets can be made through the CS:GO Lounge, allowing you to risk the weapons currently in your inventory against upcoming official CS:GO tournament matches. As you'd expect, the more expensive the weapons you place into the bet, the more payoff you're going to get back. Betting involves accepting a Steam trade from a bot, giving it the weapons you want to bet, and then trusting that if you win the bet, it'll give you them back along with your winnings. Of course, if you lose the bet, don't expect to hear from the bot again.

"The most common strategy here is to bet mid/high value items (AWP and AK skins) on safe bets," says my source. "Teams like NiP, Titan, fnatic playing vs. an underdog team with chances 80/20, to win skins worth 0.20-0.50 cents and return your items. The other part of this is to bet these items on low chance bets, like 25/75, which could get you some decent skins."

My next dealer admits that he perhaps goes a little overboard with his CS:GO trading. When you buy a "key" to open a weapons case in Global Offensive, you're presented with a spinning gambling dial, which flicks around until it eventually lands on your winning weapon.

"I'm a little addicted to that spinning dial," he tells me. "I don't like buying items off the marketplace as I enjoy the uncertainty and chance of the cases, knowing there could be something a bit more valuable inside."

He's had plenty of luck with this, grabbing $30 and $40 weapons and then selling them on the Steam Marketplace, and investing this cash in more keys -- but it's when he received an AK47 Redline through an Operation Phoenix case, worth around $120 at the time, that he began to catch his first glimpses of the real gunrunning life.

csgo2.jpg"I put it up at the lowest price compared to others selling it, and instantly got people adding me on Steam and offering me items for it," he says. "It's quite crazy how many people must be watching the marketplace -- those are the guys that you need to talk to. Usually the deals are bad, offering you things at lower value, but I make sure to check the exact items they're offering on the marketplace to see how much they are up for, and how much they've sold for in the past to make sure I don't get duped."

Since then, his CS:GO trading has involved finding expensive weapons in cases, trading them for more and more expensive weapons with other users, and then plugging all that money back into more cases.

"Why do I open all these cases if, when I get something, I just sell it anyway?" he asks himself. "The money spent is probably more than what I get back. I don't know. Because I like it I guess."

"Now that I've had a nice knife, I want one again, so my trading will probably see an increase from here," he admits. "I've had a glimpse of how it works, and as a guy who works in finance I should be in good stead. I just worry that the only way I will get back to items of that level, is I'll have to spend my own money on the marketplace, or open a fuck-ton more cases. I'll probably open a fuck-ton more cases, because I'm addicted."


"Why do I open all these cases if, when I get something, I just sell it anyway? The money spent is probably more than what I get back. I don't know. Because I like it I guess."
I heard many more similar stories from other dealers. One started with $100 in his Steam Wallet, spent the entire lot on weapons cases in the hope of getting a knife, and ended up a month later with four knives, and items totaling around $1,250.

"I normally buy knives for below average price from people who would like to sell them quick, mainly off trading websites," he says. "And [then I] sell them for the average price -- that's how I make my profit. However, normally it is not good to buy the knives off the Steam marketplace because of all the taxes -- I would be paying extra than the seller of the knife would receive due to Steam seller tax, and if I was to sell the knife again on the market, I would also have to pay the Steam seller tax. So doing this is only beneficial if it's a very good deal."

That's another trader circumventing the Steam tax then -- and there's plenty more where he came from, as numerous people told me that Steam's 15 percent cut is simply too much to make safe trading worthwhile. There are many traders with backpacks worth $2,000+, although these people told me that when you have so much worth on Steam, getting chat requests from phishing bots on Steam is a common occurrence, as scammers attempt to force a web link on you that tricks you into draining your account in their favor.

But there are other, more sneaky ways to make yourself a tidy sum via the Steam marketplace. Some users run "bots" that watch the marketplace and quickly nab any weapon that falls within particularly profitable requirements. The user can then take the botted items and sell them on for profit, with minimal effort required.

However, it's risky business -- Valve watches for these sorts of dealers, and will ban your account without warning, wiping out your inventory in the process, no matter how much it's worth. Despite that, a lot of high end traders still bot the market as the potential profit is very high.

The Don

As mentioned previously, there are some mighty big names in the world of CS:GO trading. Take a look at SAGA's backpack, for example - with over 100 rare weapons, many of which are worth in the hundreds, the total value is mind-boggling.

Through many weeks of hunting, I managed to track down a trader who, somewhat appropriately, goes by the name of DonSelf. The Don was one of the first and most prominent gunrunners of Global Offensive, and a well-known name among past and current traders.

Although he's now semi-retired, DonSelf has well and truly seen everything that CS:GO weapons trading can accomplish. His backpack is filled to the brim with keys, rare Factory New weapons, and knives with the most glorious shades of the rainbow.

In total his backpack is worth around $10,000, nearly all profit (he's managed to cash out as much as he's put in), and he even owns a weapon -- a StatTrack AK Fire Serpent Factory New -- which is one-of-a-kind, and therefore potentially worth anything to the right buyer.

csgo3.jpgCS:GO Lounge's betting area - click to enlarge


DonSelf went in hard to begin with. When weapons trading first launched for CS:GO, he quickly purchased enough keys to open around 400 weapons cases. The weapons that spewed forth amounted to around $1,000 in trades, meaning he'd already roughly broken even -- but he could already see the potential for profit.

"I realized there had to be more 'degenerate' gamblers like myself," he says. "That's why everything has value, because people can't stop gambling on boxes." He quickly spent another $2,000 in a bid to get his potential business properly up and running.

"I would look for high priced and rare items," he explains. "Generally they go together, but there are a few expensive items that are more common. Every time a weapon fell below a threshold I thought was acceptable to buy, I would buy it and essentially monopolize that item." He ended up doing this with several items back when the weapons trading boom first occurred.

Another area in which DonSelf has made a bundle is on knives. Right now, the cheapest knife you can probably find on the marketplace is around $80, but back in the beginning, knives were a lot cheaper. Since there were less of them going around, Donself quickly deduced that one day in the future they'd be rather rare, and so quickly started collecting them.

"I started to pick up the knives with the most vibrant colors, because I imagine anyone spending a few hundred dollars for cosmetics wants the most noticeable items and colors," he says. "The most popular three are the Fade, Slaughter and crimson Web."


"I realized there had to be more 'degenerate' gamblers like myself. That's why everything has value, because people can't stop gambling on boxes."
Apart from knives, he'd grab expensive AWPs, M4s and AKs -- these provided the most cashback.

"I had the mentality of a 'high end' trader from the get go," he notes. "I always wanted the best, and I figured the same for people who were collecting. In my opinion, Factory New was the only way to buy and trade things as the demand was the highest. Everyone with any lower condition was always looking to upgrade."

DonSelf's early popularity worked in his favor. High-end dealers would come to him with great potential trades, because they knew he could be trusted, and they knew he was serious. But that doesn't mean he wasn't scammed along the way -- a couple of particular under-the-table occurrences still stick with him now.

"I was skeptical of the deal, but the offer of real PayPal money excited me and I went for it," he recalls of an early deal. "Looking back, and checking his account, I could tell 100 percent that it was a scammer."

"Another time a scammer bought an older person's account with 400+ games in an attempt to use that old reputation and scam as many people as possible," he adds.

But he says that it's now a lot easier to spot a scammer before you go ahead with a PayPal trade -- check out the number of hours they've put into CS:GO on their Steam profile, the number of games they have, the quality of their inventory, their Steam profile level, and the age of their account. If anything looks off, back out.

"Despite how reputable someone may be, you always run the risk of loss when trading outside of Steam for real money," he warns. "There are a few 'traders' with high end inventories who started off by just scamming people." He links me to a handful of questionable Steam accounts, where the telltale signs aren't so clear.

"Many people profit from 'trading' by maintaining a quality reputation among the community and offering 'cash out' services for items," he notes. "They then use their knowledge and trading network to resell the knife for profit. Generally those cashing out offer on average 25-40 percent off the steam market value (what it can sell on Steam marketplace prior to tax). On higher end items - those valued over $500ish - the cash-out value 'loss' becomes a bit less as its such a high demand item."

These days, it's a lot tougher to make money through trading, says Don, due to one simple factor: Many people trading via the game aren't very intelligent, and as such, making the simpliest of trades can take a long time.

"The majority of profit now is made off of 'picking' the Steam market," he says. "There are a lot of people who either bot, or literally sit on their computer refreshing the market in hopes that someone lists a high value item. The large majority of those unboxing items are not 'traders' and do not know exactly how much certain items may go for."

"Since there is a market cap of $400, a lot of those who unbox a crazy item just immediately list it, and others sit and wait to buy it," he adds. That's where those aforementioned bots come in.

The mainstay areas that used to prove highly useful are becoming less so now as well, claims the Don. While /r/GlobalOffensiveTrade is still a great place to pick up a deal, "CS:GO Lounge has since turned into a shithole of lowballers and scammers. The website itself is run by a shady group of scammers. There was an admin on there I saw using a glitch to list items that he did not own in attempts to get payments in Bitcoin."

Some of the most successful relationships are based on lies and deceit. Since that's where they usually end up anyway, it's a logical place to start.

Of course, wartime jargon and tongue-in-cheek Nicolas Cage quotes aside, there are real concerns to consider here. While my research only delved into the world of CS:GO trading, it's obvious that the same sorts of dealings are happening within other Valve games too, such as DOTA 2 and Team Fortress 2. There's a DOTA 2 Lounge, for example, which is even more popular than the CS:GO Lounge.

Opening weapons crates in CS:GO in the hope of receiving a random priceless item is a form of gambling, yet it isn't really treated as such. I've already delved into the sorts of situations that some people can get themselves into when opening these weapons cases (or "crates" as Team Fortress 2 labels them), and many of the people I talked to for this article also displayed these signs, with some admitting to me that they were addicted to gambling their cash away on the game. Hence, it's baffling that this still isn't a hot topic that is discussed more often and openly.

But the betting system that occurs through the CS:GO and DOTA 2 Lounges is perhaps the most outlandish element in all this. If someone has the cash, they can potentially bet thousands of dollars on the outcome of a CS:GO or DOTA 2 match, all completed via Steam's own platform, albeit with what must surely be an illegal botting system.

There's no word on whether Valve is cracking down on this either, although the fact that the betting system is so prominent on the Lounge websites (and has been for some time) suggests that Valve is turning a blind eye to it. This is despite the fact that Valve is directly facilitating the deals via its own marketplace -- whether the gambling actually begins on the Steam platform or not is beyond the point.

I got in touch with Valve to discuss the stories I had discovered, but as with the last time I tried to get Valve's thoughts on these topics, I received no response back.

In all of this, it's worth remembering that Valve is making a serious amount of cash through the marketplace. Multiple items are bought and sold every single second, and with the company's 15 percent take on each transaction, you have to wonder just how much money the marketplace is bringing in.

When I was talking to my various gunrunner sources, I asked each of them the question, "Who are the biggest arms dealers of Counter-Strike: Global Offensive?"

The most prominent answer I received back? "Valve."


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Comments


Aman Parmar
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Good Piece! Similar trading practices plague Valve's Dota 2 which has a much more thriving marketplace due to the cosmetic value of the items. In CS:GO, every gun remains the same except that it has a skin. Yes, there are a few knives that look different in shape and size but you get the point.

However, in Dota 2, the lore behind each hero governs the very cosmetic being put out by a designer. Of course there are flamboyant attempts at creating such cosmetic sets like special daggers, pauldrons, helms, swords, etc. along with fancy particle effects, couriers and even music files. Not sure if anyone's heard about a guy selling his car for some in-game items but this should give you the picture http://www.reddit.com/r/Games/comments/1q11fe/dota_2_courier_sold
_for_38000_dota2/

Alexander Jhin
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I'm reminded of Pachinko Parlors in Japan. In the actual parlor, it's illegal to trade the Pachinko Balls back for cash (trading for prizes is legal, however.)

But, if you go across the street, there's a separate store that buys Pachinko Balls for cash.

So, in Japan Pachinko isn't technically gambling since cash can't be withdrawn for the Pachinko balls. But, conveniently, another shop is willing to buy the balls for cash. (The other store is a second hand ball bearing business! Really! )

Alexander Jhin
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Actually, this draws comparisons to BitCoin, too, in that people are willing to pay real cash for a virtual item which has some perceived value.

Anders Larsson
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Great article!! We are working on a system even more developed than the Valve approach, and it is extremely interesting to see these uses/(abuses?). I have some real doubts about the gambling mechanic that Valve uses... The "weapon chest" mechanic is straight gambling and increases the risk of getting regulated like a gambling company.


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