The term "gold farmer" has become almost synonymous with the preceding adjective "Chinese" over the past few years, but that may be about to change. A new regulation by China's Ministry of Culture and Ministry of Commerce declared an end to trade of virtual currency for real-world items.
"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," said the Ministries according to InformationWeek.
According to James Lee and Jiawen Zhou of Sterne Agee, this means that virtual currency cannot be given away by game operators to new players and eliminates gambling-like options such as coupons and treasure boxes. The analysts see this as a huge negative for Tencent and their QQ coins, since they no longer can be given away to new players, used on third-party platforms or be sold, and will also be a slightly lower scale negative for Shanda.
The Chinese gold trade has been growing precipitously over the past few years and is estimated to be worth several hundreds of millions of dollars annually. 300 million Internet users in China will likely be affected by this decision directly, with millions oversees affected indirectly.
We're pretty sure most U.S. MMORPG players will be very happy over this announcement, though we're fairly certain the Chinese government did not make this move on their behalf. We think as long as there's demand for this real-money trading in MMORPGs, no matter how illegal or against a TOS agreement it might be, there will always be people like gold farmers.
