clock menu more-arrow no yes

Filed under:

eSports fantasy site snagged by government crackdown on daily fantasy sports operators

New, 5 comments

A fantasy sports provider focused on eSports has been snared by the government action being taken against two much higher profile fantasy sports services.

Vulcun has shut down all activity in Nevada following a ruling by the Nevada Gaming Control Board that so-called "daily fantasy sports" is in fact betting if it pays out money. Any company engaging in that gaming within Nevada, online or otherwise, must get a license to do so from that state.

Vulcun, which is based in San Francisco and launched in January, says it has paid $7 million out of a prize pool worth more than $10 million to more than 120,000 players this year. Testimonials from users show them winning amounts between $50 and $2,500.

This weekend, Vulcun closed all accounts held by players in Nevada, giving them to Sunday to withdraw their money. It shut down paid contests for Nevada residents on Friday the day of the control board's ruling.

The Gaming Control Board's decision, handed down last week, was more aimed at two huge sites, FanDuel and Draft Kings, which have wallpapered sports media with advertisements since the beginning of the NFL season.

The Federal Bureau of Investigation and the New York state attorney general are taking a look at FanDuel and Draft Kings following reports in The New York Times that employees of those sites have played their competitors' games, taken home six figures in winnings and, according to some allegations, used inside information to do so. Several members of congress have also asked committees and other federal agencies to look into these sites' activities.

After the Times' report, Vulcun released a statement saying its employees were not allowed to play other fantasy eSports sites (Draft Kings, among others, offers eSports action) but could play fantasy football, baseball or or other sports.