Trading Card Packs Should Be Classified as Gambling, Expert Leon Xiao Argues

The boundary between collecting and gambling is becoming increasingly thin as the market for trading cards evolves. Leon Y. Xiao, an Assistant Professor at the City University of Hong Kong and a Visiting Research Fellow at King’s College London, argues that current regulatory frameworks are failing to keep pace with these changes. As products become more expensive and high-value 'chase' cards drive speculative behavior, the traditional view of trading cards as simple toys is no longer sustainable. Xiao’s research suggests that many of these products already satisfy the legal definitions of gambling in numerous jurisdictions.

Transparency remains a core issue within the industry. In a study published in the Journal of Behavioral Addictions, Xiao and his team examined the packaging and disclosures of various collectible card games. The findings point to a systemic lack of consumer information that would be unthinkable in the regulated casino sector. This lack of oversight allows manufacturers to sell high-stakes random rewards to minors without the safeguards required for other forms of betting.

Numbers and facts

Xiao’s empirical research involved the analysis of 50 physical trading card game and collectible sports card packs. The results were startling: 80% of the packs provided no probability disclosures on their packaging. The remaining 20% that did provide information were often incomplete, hard to locate, or potentially misleading. Crucially, not a single pack disclosed the specific probability of obtaining every individual card within the set. This lack of data makes it impossible for consumers to make informed financial decisions.

Xiao defines gambling in a straightforward manner that aligns with legal standards in many regions. He states:

"Card packs should constitute gambling under both the common-sense definition and the legal definition, but regulators are not enforcing gambling law properly."

He further highlights that the growth of online card 'breaking' and 'repacks'—where consumers pay for a share of a box opened by someone else—moves the activity even closer to conventional gambling. These formats often involve higher financial stakes and carry a greater risk of fraud compared to purchasing standard packs at retail.

Background

The 'gamblification' of the collectibles market has been driven by several factors, including increased demand following the Covid pandemic. With more money flowing into the hobby, particularly from adult collectors, manufacturers have introduced more expensive 'collector editions' and ultra-rare cards. Because these cards can be easily traded or sold on third-party platforms, they possess a clear real-world monetary value. Under most current laws, risking money for a chance at a prize with monetary value constitutes gambling, yet this remains unenforced in the card industry.

Why it matters for German players

In Germany, gambling is strictly regulated under the Interstate Treaty on Gambling 2021 (GlüStV 2021). Licensed operators must adhere to strict player protection measures, such as the LUGAS central monitoring system and a 1,000 Euro monthly deposit limit. However, because trading cards are not currently classified as gambling in Germany, they bypass these protections entirely. This means German consumers, including minors, can spend unlimited amounts on card packs without the intervention of the GGL (Gemeinsame Glücksspielbehörde der Länder). If regulators were to follow Xiao’s advice, card retailers might eventually need to implement age verification and spending limits similar to those found in licensed online casinos.

What it means for GGL-licensed casinos

For operators holding a GGL license, the lack of regulation for gambling-like products creates an uneven playing field. While casinos are subject to rigorous transparency requirements and high taxation, the collectible card industry operates with similar psychological triggers but none of the regulatory burdens. A shift toward classifying card packs as gambling could lead to a more harmonized market where all products involving financial risk and random chance are held to the same high standards of consumer protection. This would ultimately benefit the integrity of the broader gaming industry.