What Robinhood may find out about gambling habit from gambling corporations

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Cam Adair was so caught up in his video game addiction that he says it almost killed him.

"I was young. I probably played 16 hours a day every day. I dropped out of high school twice, pretended I had work, and deceived my family. I got to a point where I wrote a suicide note And it was kind of a night when I realized I had to change something. "

Today, after years of deliberation, Adair is safe and sound and the founder of Game Quitters.

Alex Kearns, a 20-year-old customer of the Robinhood trading app, wasn't that lucky. He took his own life last summer after believing he made a loss of $ 730,000 to Robinhood.

His parents blamed the investing company, pointing out that Kearns had tried several unsuccessful attempts to get help on a customer service line. Kearns & # 39; family have since filed an unlawful death lawsuit against Robinhood.

Speaking at a House Financial Services Committee hearing on Thursday, Robinhood CEO Vlad Tenev said, "The death of Mr. Kearns has troubled me and the entire company deeply, and we have vowed to take a number of steps, very aggressive ones, too Make our option product safer for our customers. "

The legislature asks difficult questions about the fairness of the platforms and the appeal of the apps

"Is retail involvement in retail a game of chance?" asked US Representative Bill Huizenga, R-Mich., at the hearing on Thursday.

The straight answer from those with a vested interest in avoiding the bad reputation of gambling and burdensome, costly regulation was a resounding "no".

Tenev denied the gamification of Robinhood by saying, "We know investing is serious and we invest in all training tools and customer support to help people on their investment journey."

"I believe the vast majority of retail ownership is made up of people who are saving to make their dreams come true," said Ken Griffin, CEO of Citadel hedge fund.

"Investors can participate in the market just as Insitations can participate," said Reddit retailer Keith Gill, who added GameStop's potential as its stock rose from $ 18 on New Years Day to another $ 480 in January.

But gambling addiction experts categorically disagree. "When you invest, whether in the stock market, you know that hedge funds, derivatives or whatever, it is actually a form of gambling," said Mark Griffiths, professor of behavioral addiction at Nottingham Trent University in the UK.

And investing looks and sounds more and more like gambling and video games. For example, the Space Shooters video game is giving away free treasures. The sports game platform FanDuel offers free betting insurance and Robinhood is giving away free shares.

"For example, when I watch a video game player and someone behaviorally and psychologically playing a slot machine, they behave almost the same way. The only difference is that the video game players use points to earn points, while players, you know, the kind and use how much they have won and lost to score points, "Griffiths said.

He has spent years researching addictive behavior and has worked as a consultant to companies such as Entain, a UK-based gaming company that BetMGM jointly owns with MGM Resorts. Entain launches a comprehensive initiative to address problematic video games and sports.

Entain and other casinos like MGM and Caesars are recognized in the industry as leaders in problem gambling. Gambling regulators, however, require companies to take varying degrees of responsibility for anti-problem gambling initiatives.

"The gambling industry has recognized that problem gamblers are not good for your long-term business because they have a short shelf life," Griffiths said.

The betting providers see that this increases the bottom line in the long term, but can also prevent costly regulations.

In the UK, regulators are now requiring gambling companies to use the data they collect on their players to identify indicators of damage, such as significant changes in betting behavior. Informed user consent technology gives specific feedback to help players make decisions that are more beneficial to them.

"What you see from investing to gambling to gaming are those industries that are really trying to learn from each other," Adair said. "One of the biggest ways to do this is by improving accessibility and making engagement easier." in their products and simply spending money. "

Education is crucial for Adair, who travels the world to speak to students and parents about the dangers of addictive behavior. "I think we need to pay a lot more attention to that."

Disclosure: CNBC's parent company Comcast and NBC Sports are investors in FanDuel.