Lock Poker, the struggling flagship of the Revolution Gaming Network, has been the subject of a number of articles on 4Flush and many other poker media websites. The message is clear – The company is in trouble.
Cashouts are been virtually nonexistent and the company seems to find every reason not to pay their players. It has been over a month since batches of payments have been processed. Skins on the network have also complained about not getting paid their commission.
Lock Poker funds are trading around one-third of their chip value. Bonds that trade at a value this low are classified as junk. At least if a company fails, the bondholders would eventually gain control of the company. The buyers of Lock Poker chips will not have that luxury. It seems clear to the industry that Lock Poker has failed, it is simply a matter of time before the company admits it.
The Revolution Network was the largest US facing online poker network after Lock Poker’s takeover of the Cake Poker Network just under one year ago. Hopes were high as the struggling network found itself under new management. Now that a failure seems imminent there are consequences for the entire US facing online poker industry.
Lock Poker’s implosion would affect far more than their player base. As we already know, AdamEvePoker has already halted their poker offering. Cake Poker and Juicy Stakes have been on the edge of default for years, taking nearly as long to pay their players as Lock Poker, well before the network changed hands. A number of white labels on the network also suffer from long payment delays due to the network issues. Lock Poker’s failure will take down any skin that is experiencing the same cashout delays.
The issues will extend beyond Revolution Gaming. US players only have four major options at this time. In addition to Revolution Gaming, the choices are Bovada, Merge Gaming and Winning Poker. The demise of Revolution Gaming would drop established US online poker options to just three. The lower the competition, the fewer promotions players will receive.
Bovada already gives players few benefits and Merge Gaming dropped rakeback earlier this year. That leaves the Winning Poker Network, and to a lesser extent, Bitcoin operator SealswithClubs. Players outside the US would also become even more reluctant to play on US facing sites, further affecting the liquidity on these networks.
How Much Would Revolution Gaming Players Lose?
Cereus players lost a cumulative amount of around $45 million when the network was indicted and eventually failed in 2011. It would seem that Revolution Gaming is about half the size of Cereus when it failed and has lower limit games as a whole. The network deposit amount is likely in the $15-$20 million range.
There are also Revolution Gaming skins that will be able to pay their players even if Lock Poker and the white labels fail. Intertops and Poker World would both easily survive a network failure. There are also other smaller financially strong skins that will survive and those that have virtually no focus on poker that will be unaffected. Skins that will survive a network failure are in the minority. An educated guess would put them at no more than 20% of deposited funds. If that is the case, players stand to lose $12-$16 million in a Revolution Gaming failure.
This ordeal would destroy US online poker player confidence that is already shaky at best. US players already lost about $200 million due to Black Friday and the subsequent fraud revealed at Full Tilt Poker and Cereus by the US Department of Justice. The loss from this debacle will likely be 10% or less of the Black Friday number, but the US market has also shrunk considerably since then. These diehard US players will have even less of a reason, and fewer dollars, to deposit elsewhere to play online poker.