Esports betting-focused sportsbook Vie.gg announced it has shut down across three global locations, effective immediately, including New Jersey, Spain and the United Kingdom. Customers affected in these areas were sent an email informing them of the decision, and giving them details on how to withdraw their funds.
The Vie.gg platform is one of several owned by Esports Entertainment Group. The message received by customers explained that the company has “made the difficult decision to close” the site, which remained open until November 1.
EEG Chief Executive Officer Grant Johnson explained during an interview that the decision to withdraw from these areas was difficult “but necessary,” and spoke about “stressful times” to doing business.
Regarding the decision to shut down in New Jersey, he explained that as esports was categorized the same as sports betting, the skin costs the company seven figures a year, which is too much for esports in its current stage as an evolving vertical.
Grant added that if the market had not turned so radically, the company would have been able to raise capital and add a sportsbook. “But by the time we were approved, clearly the world had changed,” he noted. The company is currently restructuring to last through to move to stable markets.
This announcement is not the first indicating a company is withdrawing from a particular market in recent times. In New Jersey, Fubo Sportsbook announced its closure just weeks before, in a decision that came barely a month after the sportsbook had opened its site in the jurisdiction. Similar sites in Arizona and Iowa also closed and FuboTV announced that the company was going to “exit the online sports wagering business effective immediately.”
The UK has also seen some exits as of late, based on undergoing legal changes regarding online gambling. The region is no longer accepting Kahwanake or MGA-certified sites, which has led to a significant number of companies moving out. Companies that have left the market include BetBright, 188Bet, InterCasino, Vera, Royal Panda, and Dunder.
Vie.gg initially got its New Jersey license in September 2021, becoming the first esports-focused vertical to launch in the state. EEG’s platform fully rolled out in April 2022, in affiliation with Bally’s Atlantic City Hotel and Casino.
Bally’s financials from August showed just $590 in sports wagering gross revenue, which was not enough to run a profitable operation. However, gambling operators in the US are not all looking at getting out of offering esports betting. In Nevada, for instance, regulators are looking at expanding options for casinos to offer more esports action.
In May, EEG posted its third-quarter earnings report and revealed that the business would be facing significant liquidity issues going forward despite revenue growth. Addressing the near-term challenges for the business, Johnson said that the lack of liquidity has already impacted the company by not allowing it to fully monetize its Helix, ggCircuit, and EGL esports assets and resulted in a multi-million impairment charge.
Original article: https://www.yogonet.com/international/news/2022/11/01/64863-eeg-39s-viegg-esportsbook-shuts-down-its-operations-in-new-jersey–spain-and-the-uk
