The People’s Republic of China bans real money trading.
“The virtual currency, which is converted into real money at a certain exchange rate, will only be allowed to trade in virtual goods and services provided by its issuer, not real goods and services.” it said.
China has the world’s largest population of Internet users, with 298 million people online as of the end of last year.
According to media reports, the virtual money trade topped several billion yuan last year after rising around 20 percent annually.
China being the largest MMO market in the world, and many Chinese MMOs being dependent on RMT for their income — this will have some ripples.
{ 27 comments… read them below or add one }
This shouldn’t affect game distributors from selling items and services for money, it only targets 3rd parties from selling fake money for real money.
I think. I’m bad at reading translated legalese.
How I translated this announcement: Tencent wrote this new law for us and then paid the proper… “lobbying fee” to get it passed. I bet Tencent just made Activision’s Christmas card list.
Any nationally-inspired outrage I have over socialist interference of free market ideals is drowned out by my quasi-religious desire for purity in gaming for which RMT operates only as a portal of perpetual taint.
While I’m uncertain if this meets the definition of ironic, it certainly is poetic.
I fistpumped.
But really, I think it’s fine to waste thousands of dollars in real life currency for make-believe currency, just not in my make-believe land.
I love that they’re called “QQ coins”. Brilliant.
I very much doubt that this will be interpreted or enforced against mainland chinese farming gold to be sold exclusively to gweilo.
All this means is that the chinese MARKET for gold will be more informal.
That’s how I read it as well. Looks like item shops are just fine.
There’s going to be some consequences, that’s for sure. But I wonder about the exact wording of the law, and whether or not some companies currently in violation of it will actually find some way around it.
RMT became more than what people called it, whether it was a plague, a disease, or a necessity. It became a viable business model. I can’t help but wonder what the next model of virtual-to-real currency might became, or if the banning of third party RMT means that in-game or official RMT will become more prevalent. Time will tell.
Great, now the Chinese government is getting into protecting business models. All this does, demonstrably, is to drive the trade underground and lead to more users being ripped off, as well as preventing such things as the fully dev-authorised trading of timecodes in Eve.
Also; “minors may not buy virtual money”.
Mann – “Fake” money? Legally MMO currencys are are no different to “company scrip” (look it up).
well India is happy
@Andrew Crystall
The primary difference I see is intent. Developers don’t actually intend to pay their players anything other than the nebulous and transient concept of fun, whereas company scrip was actually intended to act as currency as payment for services rendered.
Games that feel like a job… well, that’s a design issue, but not usually the intent.
I guess that with globalization around, you cant really promote an industry that its illegal in other countries. That and people in China want to leave behind the stigma of “sweatshops”. Too bad that all the gold trading industry its going underground and its going to requiere a lot of police force for stopping it. If such thing its possible.
This is actually reasonable.
Given how easily corruptible the mainland China Police (and the courts) are. I highly doubt that there will be any serious enforcement let alone prosecution of any of the big money Chinese RMT operators. ESPECIALLY against the ones catering to Western games like WoW being played in the West (non-China). There won’t be any lessening any of the RMT happening in the foreseeable future.
In fact, I would think the Chinese Police and the politicians would be happy to have another revenue stream to collect bribes and protection money from.
In related news, NetEase, WoW’s new publisher in China, is reportedly/rumoredly stalled out for beginning business, pending review of former publisher The9′s lawsuits.
http://www.jlmpacificepoch.com/newsstories?id=151327_0_5_0_M
Hmm, I’m not sure that this is exactly RMT they’re outlawing. As a non-lawyer outsider, I think this is more to prevent competing currencies. Tencent’s QQ coins were being used widely outside the game as a form of exchange. It’s like if the local 7-11 accepted Puzzle Pirate Doubloons to purchase cell phone minutes. The only western game company that will have to worry is Mindark and their Entropia Universe since they explicitly allow you to change game currency to real currency.
We’ll see if this rule stops gold farming businesses. I suspect it may not, since it’s slightly different than stopping an alternate currency as the QQ coins were becoming.
There is a big difference between enacting a law and enforcing a law. Especially in a country like China.
I expect the only change this law will cause is some bribes being paid from time to time. Nothing else.
I agree. Though, the policy geek and economist in me occasionally wonder about alternate currencies anyway. The statism inherent in protecting a currency tends to ignore what actually happens in the “real” economy, where people are trying to get by and make a buck, rather than protect political power. It’s a dangerous road, and you can never really stop barter anyway. People will just find new ways to do business, and new ways to keep the State from taking a bite out if it.
(For example, “macks” have supplanted cigarettes in prison “economies”. People always find a way to make trade happen.)
Heh, interesting… http://online.wsj.com/article/SB122290720439096481.html
@Mann – That’s why I said /legal/ difference. Private barter systems involving tokens are only illegal in specific situations, for instance involving gambling in much of America and in payment for work in the UK.
Brian – I disagree. Watch Eve China, where timecode trading has previously stamped on most other RMT, go back to goldseller spam after this.
As i understand it, it doesn’t change anything in games, you can still buy virtual goods and services.
@Brian ‘Psychochild’ Green
Yeah, I agree. I’m not sure this is actually aimed at the WoW gold farming peeps.
No, it’s Tencent acting to protect their interests. That it bans a lot of business models, including all pre-loaded cards (given they’re also company scrip in the same way) for, say, trains… well, no, Tencent /don’t/ care.
I believe this law is designed to prevent virtual currencies (such as TenCent’s QQ Coins) from competing with China’s official currency, the Yuan. China’s government controls the Yuan’s exchange rate, resulting in Chinese goods being cheap in other countries, while other countries goods are relatively expensive in China. The Chinese government fears that a commonly used virtual currency might threaten that.
Also remember that Chinese law enforcement is ALWAYS selective. National laws are regularly ignored by regional governments if it goes against their local interest. As long as gold farmers are selling virtual gold for real world dollars to foreigners, I expect the Chinese will look the other way and let the local industry flourish. What the Chinese are trying to prevent is a future where people use QQ Coins to buy lunch, get a taxi ride or have their hair styled – because QQ Coins are worth more dollars than the Yuan is!
It is worth noting that gambling with virtual currency is also illegal. No more outings to the slime race track in Lineage.
To repost what I already told Scott anyway:
1) The fact that it is a joint announcement from the Ministries of Culture (very important) and Commerice (pretty important), signals that this is a Big Deal.
2) The fact that TenCent is specifically mentioned means that the reporter writing the story was likely (not 100% obviously, but very likely) fed their name specifically, which means it is a shot across their bow from Culture.
3) Since this is only about output transactions and not input ones (i.e., buying things ingame is still OK, but taking virtual cash out of the system for real world money), it is likely more about money laundering and currency control than anything else, hence the involvement of Commerce. Culture has enough clout in the online-game sphere to have taken care of it alone if need be; this ruling has wider implications.
4) In short, if you are planning a Chinese-language game with RMT in it, just don’t plan on letting players ‘cash out’ in some way and you should be fine. This is about bigger fish than yours.
Technically, if it’s about prohibiting cashing virtual items out for cash, doesn’t that effect real money traders directly? Their bread and butter is accruing the virtual to sell for the real.