Russian Invasion of Ukraine: The Inevitable iGaming Fallout

Russia’s invasion of Ukraine has left a mark on practically every industry worldwide. No sector has been spared from tech to gaming, manufacturing and even fast-food chains as Russia-facing subsidiaries of different companies moved to exit the country since it launched the invasion. And as the aggressor presses on with its attack, the country continues to face more sanctions that are ripping through different industries by the day.

The iGaming industry is already feeling the impact of these sanctions as many online casinos served the Russian market as part of their larger European business. So, how will these sanctions shape the iGaming sector in Russia and the rest of the world? Read on to find out how the iGaming scene is evolving due to the invasion.

Blacklisting of Russian Markets

Sportsbooks from the west, especially the United States, have moved to stop accepting bets on Russian sporting events. And as you can imagine, industry juggernauts are leading the charge.

DraftKings, which had a very strong market presence in Russia, was among the first to announce its exit. The company also stopped offering bets on sporting leagues where Russian teams are participating to send a strong anti-war message. For instance, the Kontinental Hockey league, which comprises teams across Russia, Belarus, China and Kazakhstan, is no longer available on the DraftKings Sportsbook.

One of DraftKings’ most fierce competitors, Caesars, followed suit by announcing that it had closed its betting market on Russian soccer, hockey, table tennis and volleyball. PointsBet also joined the boycott of Russian sports by canceling all betting activity from Russian and Belarus sporting events. FanDuel, another bigwig in the US sports betting scene, also recently announced that it was indefinitely suspending all betting markets in Russian and Belarus professional sporting events.

Regulators Have Also Joined the Fight

Gaming regulators in different countries are taking action. For instance, in the United Kingdom, the UK Gambling Commission recently issued a directive to all the parties in the industry to apply a risk-based approach in any third party or business relationships that they conduct. Basically, this directive is a thinly veiled threat to operators against serving the Russian market in light of the UK government’s sanctions against Russia.

The Malta Gaming Authority also gave a similar directive, urging that licensees must run new background checks in light of the new Russian sanctions. These two regulators are just a few of the many expected to come up with such directives to remove Russia from the equation for its invasion.

Enhanced Background Checks Will Be the Order of the Day

Operators must adhere to the sanctions placed by the regulatory bodies. So, to mitigate the risks associated with failing to adhere to regulatory directives, operators must introduce enhanced due diligence techniques to stay in line. Sportsbook and real money casino online companies are now casting a keen eye on the customers or prospective business partners they engage with following the newly introduced regulatory changes.

It’s worth pointing out that these restrictions don’t just apply to new customers and business partners. They are also applicable to existing relationships. Thus, iGaming companies have to conduct checks to ensure they are not in bed with the enemy, so to say. Abiding by the new directive will also save the iGaming brands any potential trouble with the government as the sanctions are implemented under federal law. Contravening the new regulations could mean that a company may even face prosecution, on top of risking the suspension of its operating license by the industry regulator.

The Possibility of Pushback from the Russian Government

Owing to these sanctions, the Russian government will likely come up with its countermeasures. For instance, in the iGaming world, sportsbooks that may still be operating in Russia may no longer be welcome if they appear not to take their side. It will be a surprise to find a brand associated with the west still operating in Russia.

Gaming & Esports Brands Have Answered Ukraine’s Call for Support

Following in the footsteps of iGaming companies like DraftKings and Caesars, video gaming and esports companies have also declared their anti-war stance. In fact, they received an open letter from Ukraine, calling for them to block Russian and Belarusian accounts to try and motivate Russia into ceasing military aggression. The letter also encouraged them to temporarily prevent Russian and Belarusian teams and gamers from taking part in events and cancel those that were to be hosted in the two countries.

In such trying times, the industry cannot afford to sit on the fence. So, to back Ukraine, the gaming world at large has joined the fold through financial aid and taking action against Russian and Belarusian players. Some of the biggest video game and esports companies that have rallied behind Ukraine include:

• Electronic Arts
• Riot Games
• Sony
• CD Projekt Red
• Square Enix
• Bit Studios 11
• Microsoft
• Activision Blizzard
• Epic Games
• Take-Two
• Nintendo
• Microsoft
• Unity
• Ubisoft

Here’s to hoping that Russia will end its invasion soon and that we never face such military aggressions from any other country again.

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