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I recently stumbled upon a website where people gamble for Counter Strike: Global Offensive skins called CS: GO Jackpot. Is it legal for those running CS: GO Jackpot to do this? Arguments that they are digital game items with no "real world value" is a very bad argument to be tried to use here.

That same argument could easily be used for Bit Coin, gold, or silver, and yet, those are all considered to have value.

If you tried to make a casino that ONLY took one (or a combination of those) as payment, they'd still under the jurisdiction of the local gaming laws.

I'll add the site is a raffle site and almost every state in the USA considers raffles "gambling".

There are very specific requirements which can allow them to be operated but that site definitely doesn't follow any of them.

It doesn't matter who assigns the cash value to it, just that enough people assign cash value.

That is all that matters and given how many users sites like have (over one million users), I'd definitely have to say that these game items have enough people that consider them to have value.

Also, just because you use something that doesn't have value to an outside observer, doesn't mean it's not illegal.

They could be using blades of grass for all that matters, it would still be under the jurisdiction of gaming laws if there is a major cash exchange for blades of grass.

In reality is just means they're using a fiat currency and that makes sites like money launderers.

The only reason the question wasn't raised earlier was because the only gambling site prior to was which is located in eastern Europe.

On top of that, it has no house cut and therefore it allows betting there to be classified as "a game of skill" since you can obtain an edge and consistently win.