Loot boxes: what parents should know before kids spend
Loot boxes charge kids before revealing a random reward. Here is what research says, the warning label to check, and a parent checklist that stops surprise spending.
A loot box is a paid in-game container that reveals a random reward only after you pay, a gambling-like mechanic linked to overspending in children. Parents should check the warning label, require a purchase password, set a visible budget, and use a waiting rule before any purchase.
Your child is not asking for a toy. They are asking for a chance at one. A loot box is a digital container inside a video game that opens to reveal a random reward, a new skin, a weapon, a character, or a dance move. You pay first, and you only find out what you got afterwards. That order, pay first, reveal second, is the whole point of this article, because it is also what makes loot boxes feel so much like gambling, even when the game never uses that word.
Loot boxes are everywhere in the games children actually play. A survey sponsored by the UK Gambling Commission found that 23% of 11-to-16-year-olds had paid to use loot boxes, and a later Gambling Commission follow-up found that 27% of young people surveyed had paid to open loot boxes, packs or chests. In other words, this is not a rare corner of gaming. If your child plays popular online games, they have almost certainly been offered one.
Why loot boxes hook kids
Loot boxes borrow the oldest tricks in gambling design. The reward is random, so the brain keeps hoping the next one will be the rare one. The reveal is loud, bright and celebratory, even when the prize is worthless. And the cost is hidden behind virtual coins or gems, so a child never sees real money leaving. Research from Newcastle and Loughborough universities found that children find it difficult to track their spending in games, fail to understand the value of money in them, and are pushed towards repeat buying by collectible items and gambling-style techniques, according to the Loughborough University report.
There is also a social pull. A rare skin is a status symbol in the school playground, just like a rare trading card used to be. Children report buying loot boxes to fit in with a friend group, and the fear of missing a limited-time item adds urgency. None of this means your child has a gambling problem. It means the design is working exactly as intended, and it is working on a brain that is still learning self-control.
What the research actually says
It is important to be honest here. Research has found a consistent association between loot-box spending and problem-gambling indicators, especially among adolescents, but association is not proof of cause. As the Gambling Commission's own advice puts it, the direction of causality is not clear: it may be that loot boxes cause harm, or that young people already at risk are drawn to them, or both. A parent guide on loot boxes makes the same point clearly: the studies are mostly snapshots, so they cannot prove that loot boxes caused later gambling problems for any individual child, as explained by FitraGuard's parent guide.
What we can say with confidence is that the risk is real enough to act on, and that parents are at a disadvantage. Brand-new research from the University of Tasmania, published in October 2026, found that parents and non-gamers were poorer than gamers at identifying loot boxes, their features, and even the receipts they generate, as reported by Phys.org. If you cannot spot the purchase, you cannot manage it. That is the gap this article closes.
Loot box vs the other ways games charge
| Way of buying | Do you know what you get? | Real money? | Parent watch-out |
|---|---|---|---|
| Loot box / mystery pack | No, random until opened | Yes, directly or via coins | The random reveal is the hook |
| Direct skin purchase | Yes, exactly that item | Yes | Price only, no gambling mechanic |
| Battle pass | Mostly, rewards unlock by playing | Yes, plus time pressure | Fear of missing seasonal rewards |
| Earned reward | Yes, earned by playing | No | Time spent, not money spent |
| Trading / betting skins outside the game | Varies, and often unregulated | Yes, real cash value | A different, more serious risk |
The row that matters most is the last one. If your child moves from opening boxes inside a game to trading or betting items on outside websites, that is no longer just a game purchase. Treat it as a red flag and step in.
The label to look for
Since April 2020, games that offer paid randomised items in North America carry the label "In-Game Purchases (Includes Random Items)" from the Entertainment Software Rating Board. The label is meant to warn parents before they buy, although researchers have found that labelling is not always applied consistently across stores, as documented by the IT University of Copenhagen study. In Europe, PEGI uses a similar notice. The label does not change the age rating, and it does not block the purchase. It is a warning, not a lock. The lock has to come from you.
The parent checklist
First, look at the game together before any money is spent. Ask your child to show you the shop screen and explain what each item does. Second, remove the payment method from the child's device or require a password for every purchase, so no purchase happens by accident or by tapping through. Third, set a clear monthly gaming budget, ideally with gift cards, so the limit is visible and cannot be quietly exceeded. Fourth, agree on a waiting rule: no loot box on the day it is wanted. If they still want it in a week, it was a real choice, not an impulse. Fifth, check the purchase history together once a month, the same way you would check a bank statement. The UK NHS guide for families recommends exactly this kind of routine: talk as a family about what is allowed, password-protect accounts, and keep credit cards off the child's device.
Finally, have the honest conversation. Explain that a loot box is a paid gamble on a digital item, that the game is designed to make "just one more" feel exciting, and that a rare item does not make anyone a better player or a better friend. Children who understand the trick are much harder to trick.
FAQs
Are loot boxes gambling?
Legally, it depends on the country. Belgium has treated paid loot boxes as games of chance, while other countries, including the UK and the US, have not banned them outright. What matters for parents is the mechanic: you pay for a random outcome, which is gambling-like even where the law does not call it gambling.
How common is loot-box spending among children?
Common. A Gambling Commission-sponsored survey found 23% of 11-to-16-year-olds had paid to use loot boxes, and the Commission's 2024 follow-up put the figure at 27% of young people surveyed. The Gambling Commission's 2025 gaming report also found that 80% of young people knew in-game items could be bought with real money.
Do loot boxes cause gambling addiction?
Research shows an association, not proven causation. Young people who spend on loot boxes are more likely to show problem-gambling indicators, but studies cannot yet say which causes which. That uncertainty is a reason for caution, not a reason to ignore the risk.
What is the ESRB "Includes Random Items" label?
It is a warning label added in 2020 to games that sell randomised in-game items. It tells you the game contains loot-box-style purchases, but it does not block them or change the age rating. You still need your own controls.
What should I do if my child has already spent a lot?
Do not panic and do not just confiscate the device. Sit down together, look at the purchase history, turn on purchase passwords, contact the platform about refunds for unauthorised purchases, and agree on a budget going forward. If spending feels out of control, talk to your child's school counsellor or a gambling-support service early.
Are free loot boxes safe?
Safer, but not risk-free. Boxes earned by playing still teach the same "open and hope" habit, and they often sit right next to paid boxes in the same shop. Use earned boxes as a chance to talk about the mechanic before real money is involved.