China bans online 'gold farming'

China has unveiled the first official rule on the use of virtual currency in the trade of real goods and services to limit possible impact on the real financial system. The Chinese government also spelled out the definition of "virtual currency" for the first time, which includes prepaid cards of cybergames, according to a joint announcement from the Ministry of Culture and the Ministry of Commerce Friday. It said:

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.

The ban is primarily aimed at "gold farming," an Internet-age phenomenon in which players in less developed countries collect and sell virtual gold (common to games like World of Warcraft) to wealthier gamers in the developed world. This enables gamers who have the means to buy virtual gold to get ahead in the games without actually having to accomplish the grunt work.

The trading of virtual currency for real cash generates between $200 million and $1 billion annually, according to a 2008 survey conducted by Richard Heeks at the University of Manchester.

The average user will only partially care about this ban. They might be disappointed that they can't buy their way to higher status, but I assume that Tencent and other popular sites will figure out a way to do in-game trades and that eventually the farmers will figure out how to bypass the restrictions.

The ban may scare off smaller shops, but the sophisticated organizations will continue on the same path. It reminds me of Japanese pachinko parlors where you can only win tokens (wink, wink) that you take next door for actual cash.

While I'm not convinced that gold farming is good or bad, there is a very persuasive argument that it's driving economic development in China, and that anything that perpetuates economic stimulus is a good thing.

(Via InformationWeek.)

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[Michichael]

Gold farming is absolutely horrible and ruins the economy in any of these games. For once I'm entirely behind a Chinese government action. If you were in game and had to deal with these people you'd agree - their constant spamming, and illegal tactics at gold farming (hacking player accounts, stripping people of gear/guilds of their banks etc, keyloggers, and whatever else have you) lead to a lot of work for Blizzard and any other MMO companies out there. Gold farmers are a plague on the players of the game and on the entire system. <br /><br />Companies like Linden that host their own currency conversions and closely monitor it are fine, but when you've got an unregulated activity that in and of itself is a violation of the ToS of any of these games, and is the source of the majority of in-game hacking and fraud, there's a serious problem.<br /><br />I hope they crack down on this sort of thing ruthlessly. Serious repercussions on any of these script kiddies (mandatory castration anyone?)

As for the gold farmers, would their lives be any better or enriched if they didn't have a job like this? Could a 20-something in the Congo or China be supporting a family of 4 by farming gold? And if that were true, how does taking this opportunity away help them? In a larger, more philosophical sense, what you've uncovered is a glimpse into the world economy of the future. Could something like this be stopped even if we tried? (War on Virtual Gold Farming ..Ugh) <br /> <br />Those of you kneejerkers out there, get out of your little box and consider the bigger picture. &gt;;-)

[Michichael]

Yes, because everyone knows we have to consider the family of those that practice this through fraud, viruses, keyloggers, and other script kiddie ********. I don't buy it. Let em starve to death if they don't have any real skills - natural selection.

[eldris_]

Gold farming ruined one of my favourite MMORPGs for me because of the drastic measures they took to stop "real world trading", i.e. gold farming. One of the main reasons they took these measures is because people would use stolen credit cards to buy gold, but also because it had an effect on the game's economy (although their actions subsequently killed the game's economy, but it has recovered a little).<br /><br />It is well known amongst MMORPG players that China is where most gold farmers operate, so I'm very happy with this move by the Chinese authorities. Whether or not they can actually stop it is another matter, but at least they are trying.

[sythara]

Gold farming is annoying and I'm glad its being handled.... although I do not believe its any Government's job to regulate computer game economies.... I mean what if US Government did the same thing? <br /> <br />Now whether gold farming upsets the game economy, that is debatable. Does it really matter if its your character out there grinding mobs to make gold or someone else? Mobs still get ground, and instead of the grinder spending money at the AH, some other character does. The gold thats generated still gets spent. <br /> <br />Now gold farmers spoil the game for others at times by preventing you from grinding the mobs you want or farming that ore, but thats hardly something worth Government's intervention over. <br /> <br />Now of course, if you're that desperate to actually spend real money to get something thats not real.... well you have bigger problems, and in my opinion the people who buy this virtual gold are the real problem.

[WOWMOGSGOLD]

I do not see this happening... Seeing as how the chinese gold farming operations work, it is nearly impossible for China to pull this off. Sites such as www.MOGS.com are USA based and the games they sell are USA based, granted a majority of the supply there is from players in the USA some comes from China gold farms... if China is going to ban they are going to focus on domestic games to China, however the level of corruption in China at a local level is insane so for the State wide government to do this they have to get through the corrupt local government... All I can say is good luck!

[BenjaminLK]

Being intrigued by such a company set up, I went on a quest to speak to Gold Sellers, pretending to be a potential customer then befriending the salesperson.<br /><br />I was surprised by how many different types of people actually work for these companies. Many university leavers who wish to better their English and make a good living, find themselves 'chatting up' gamers for their virtual currency exchange services.<br /><br />If China systematically shut down all these websites I would be very intrigued to see what impact it would have across their economy.<br /><br />I personally think (since this will be a big part of our future) the companies who offer the gaming services, be it Blizzard, SOE, CCP or any other major one, need to work with these companies and help regulate it, assuming their game economy can be balanced, made fair and everyone enjoys the game.<br /><br />Remember, it's just a game - but a profitable almost limitless product.

[jcolier]

Who pays actual hard-earned money for virtual gold?? It's just a game! People should go outside and possibly even converse with their neighbors.

[Wenksz]

The news about China banning gold farming alerted many gamers specially for those who grind just for fun. Perhaps, people who is not a gamer won't be able to understand a real gamer's sentiments brought by this news. I found an article where I was somehow relieved that it clearly explained that my favorite MMO's were spared from this banning:<br /><br />http://www.wowgoldfacts.com/2009/07/06/the-story-behind-the-chinese-brouhaha-lost-in-translation-indeed/

[wiseoldman365]

I think the failure of the MMO industry as a whole to find a solution to thier own games economies which is now starting to result in legal problems, such as fraud, identity theaft and computer hacking are now getting the attention of governments in the world. And like all governments, the second they notice a problem, they feel they must regulate it and make laws on it. In this case the MMO companies by thier failure to act are now noticing laws being placed upon thier games, which would also be litterally laws on internet use. This downward slop could in effect start to branch off into other areas which could ultimatly regulate our use of the internet as a whole directily at our isp providers. So if anyone is to blame for gil sellers and regulations of our games and internet, it would be solely the developers of these games who failed to have a well thought out plan of dealing with the game currency farmer, seller and buyer. Just the fact that game currency exchanges take place, should be enough for a game industry to try to cash in on them, almost like EQ2, which has two servers solely dedicated for game currency and character selelrs and buyers, I think that is the best action to stop fraud any MMO has ever taken. People who want to make money will graviate to the servers that allow that activity because thier customers, (the buyers of game money and characteres) will gravitate to that server naturally, because of the more secure atomosphere they can enact thier transactions. You may not agree with the statment that it will be the MMO as the main reason that the internet will be regulated, but we will have to wait and find out which reason they choose to use to regulate it with.

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