FINANCIAL NEWS Tara Loader Wilkinson 25 Sep 2006 Regulatory crackdown and arrests in the US have hit pipeline of gaming flotations
Investors in online poker should know they can lose their shirts on one bad hand. But they might not have expected such a sustained run of bad cards that has seen the value of online gaming companies collapse by 51% from this year’s highs. It has also hit the prospects of those companies hoping to cash in on the tail end of the online poker craze by going public.
A combination of a clampdown by US regulators, high profile arrests of executives and questions over the sustainability of the business model of online gambling companies has wiped more than £6bn (€9.5bn) off the value of the big five listed companies.
PartyGaming, the biggest in its sector, is down a third from its highs in May, as is BETonSports, whose chief executive was arrested in the US this summer. Shares in 888.com have tumbled 47% from their peak this year, while SportingBet, whose chairman was held in the US last month, have dropped 58%. The worst performer is BetandWin, an Austrian gaming company whose co-chief executives were arrested in France this month and whose shares have collapsed more than 80%.
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Cryptocurrencies have completely changed how we look at deposits and withdrawals for online gambling of all types. The upcoming CryptoSlots online casino will be the newest sister site to Slotland Casino and will use the same software while providing players with a crypto-only environment. This is a great concept, and it'll be interesting to see just how well they're able to make it work in practice.
Software and Banking
PKR.com players are reminded that PokerStars has covered any losses you may have suffered when the MPN hosted site shut down in May. Players who had money tied up when PKR.com went into administration should have received an email in July telling them what to do. Many who had accounts at both rooms simply made a few clicks after receiving the email, logged on to PokerStars and found their money waiting; some had to have it manually processed.
According to emails that have been going out to players, First Web Casino will be closing its doors this month. This is one of the original nine casinos launched by the Jackpot Factory group, once known for being one of the most important companies to operate online casinos in the world. This closure will leave them with only four casino sites left out of those original nine, and they include names that were among the most well-known around five years ago.