India’s online gaming industry has been hit hard by the Promotion and Regulation of Online Gaming Act, 2025, which bans real-money gaming across the country. Bengaluru-based Gameskraft has now become one of the most high-profile companies to shut down operations in the wake of this law.
The company announced that it is suspending its business entirely and beginning a major restructuring process. As part of this exercise, about 120 employees across various teams have been laid off.
New Law Brings Impact
The ban on real-money gaming has been defended by policymakers as a measure to prevent addiction and financial losses. However, industry leaders argue that such strict rules could drive users toward unregulated offshore platforms, creating even greater risks.
Gameskraft, which was once one of India’s largest gaming startups, said that despite every effort, it could not sustain operations under the new regulatory climate. The company pointed to compliance obligations, taxation pressures, and policy hurdles as reasons for its closure.
Difficult Decision Taken
In a note to employees, Gameskraft explained that the decision to shut down was not linked to employee performance but to unavoidable external circumstances. Founder and CEO Prithvi Singh called it one of the most painful moments in the company’s journey.
The layoffs affect multiple teams, and the company has hinted that more structural changes may follow if it pivots to a new business direction in the future.
Internal Crisis Adds Pressure
The shutdown news comes at a time when Gameskraft is already struggling with internal controversies. Earlier this month, the company filed a police case against its former CFO, Ramesh Prabhu, accusing him of siphoning off Rs 270.43 crore over nearly five years through personal trading in futures and options.
This internal turmoil, combined with the regulatory crackdown, has placed the company in a particularly vulnerable position, leaving little room to recover.
Employee Support
Despite the grim announcement, Gameskraft has promised a comprehensive support package for affected staff. This includes medical insurance coverage until March 2026, extended wellness and health benefits through May 2026, and the option to convert group insurance policies into individual plans.
The company has also committed to providing leave encashment at full salary, outplacement assistance, referrals, and recommendation letters. Employees will also receive priority consideration if Gameskraft launches new projects in the future.
Real Money Gaming Ban
The ban on real-money gaming is reshaping India’s entire gaming sector. Supporters believe it is a necessary move to protect vulnerable players from exploitation and addiction. Critics, however, argue that the ban will stifle innovation and drive revenue away from regulated Indian firms, pushing users to unsafe offshore alternatives.
For companies like Gameskraft, which thrived on card games, casual formats, and real-money titles, the ban has proven devastating. The incident highlights how sudden regulatory changes can disrupt even well-established startups, leaving employees, investors, and customers uncertain about the future.
Industry Future in Doubt
With Gameskraft shutting down, the future of online real-money gaming in India looks uncertain. Many startups are reconsidering their business models, while investors are growing cautious about funding in the space.
As debates continue around balancing regulation with innovation, Gameskraft’s story stands as a reminder of how quickly policy shifts can reshape an industry. For now, the company’s exit marks one of the biggest setbacks in India’s gaming history.
