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China Curbs Use of Virtual Money

In an effort to stave off a new form of money laundering, prohibited gambling and threats to the Chinese yuan (Chinese currency), Chinese Web sites have been ordered to limit the use of virtual money. Public prosecutor Yang Tao says “The QQ coin is challenging the status of the [yuan] as the only legitimate currency in China.”

Specifically, virtual money may only be used to buy virtual products and services the companies provide themselves, issuance will be limited, and users are “strictly forbidden” from trading it into legal tender for a profit.

QQ coins, issued by Tencent.com – China’s largest instant-messaging service provider – are the most popular form of online credits used by 220 million users. They are being used to pay for an increasing array of services including gambling, phone sex services and shopping online

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China to Police Online Games

China will police online games to ensure legality and suitability of content. Game distributors must first get approval to release new games. They will be responsible for detailed monthly reporting and to ensure operators do not add illegal or improper content.

The latest crackdown was prompted by “a rash of problems with imported online games, some of which contain sensitive religious material or refer to territorial disputes,” Xinhua said. It said some were criticized as pornographic or too violent.

Sources: Gamasutra | China View | ABC News | Fox News (AP)

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Group Prosecuted in China for ‘Arms Dealing’ in Legends of Mir

A former deputy manager of Shanghai-based Shanda Network Development, Wang Yihui, and two accomplices are being prosecuted in China for illegal virtual weapons trade. Mr. Yihui changed the underlying game database of the popular Legend of Mir video game to produce, and replicate, two high powered weapons and provide them to two registered gamer accomplices. They, in turn, sold multiple copies of these weapons for profit. The group was able to make around $250,000 between September 2004 to August 2005 by such sales. Users of these weapons have an unfair advantage that allows them to advance through the game at a much quicker pace. The group are being prosecuted for copyright infringement.

Sources: Bit-tech.net | ars technica | Live Science | Spong | Taipei Times | 7 Days | IEET | War Cry | China Post

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Chinese Man Looses Appeal to Reverse Conviction for Stealing Virtual Property

Last December, Yan Yifan was convicted of stealing virtual property and sentenced to a fine of 5,000 yuan (US$617) by the court of Guangzhou’s Tianhe District. He appealed on the grounds that virtual goods should not get legal protection. The court found that, because game players had put time and money into getting the virtual equipment and because Yifan had profited from selling the goods, they did deserve protection.

Sources: People’s Daily Online | The Register | CNet | ZDNet | CRI 1 | CRI 2 | Reuters | Top Tech News | P2PNet | Washington Post | Zinhau Net 1 | Zinhau Net 2

Dale’s Comment: I find it ironic that the law of virtual property seems to be developing in communist China where property rights are historically lower than in capitalist countries. Given the enormous amount of time people spend accumulating/earning/winning virtual property within MMORPGs, I see virtual property as equally deserving of property protection as, say, lottery winnings. Clearly there is an increasing real-world value to virtual property. To the extent virtual property can be monetized in the real world, I submit that it should be given legal recognition as a property interest deserving of protection just like any other property.

See, for instance, the new and wildly popular Second Life MMORPG where users frequently use real money to purchase virtual property. Second Life actually publishes how much money is spent in the game each month. Real currency is converted to the in-game $Lindex currency and, through the games ‘Marketplace’ users can convert $Lindex back to real currency. Clearly, this “virtual” property has real-world value that if stolen etc. may give rise to enforceable property rights in the real world. I doubt it will be long before this type of case makes its way to the courts.

See also, the many related gold-farming stories referenced in my March 16, 2006 post. See also the related June 8, 2005 story where a Shanghai man narrowly escaped a death sentence after killing another man that had stolen (and sold0 his virtual sword. The man committed the murder after first being rebuffed by the police when he approached them for help in the matter. The police turned him away because virtual property, at that time, was not recognized as property.

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In-Game Virtual Property ‘Theft’ Lead to Fatal Attack

Shanghai gamer Qiu Chengwei killed player Zhu Caoyuan when he discovered he had sold a “dragon sabre” he had been loaned, while playing the online game Legends of Mir 3. Before the attack Mr Chengwei told police about the theft who said the weapon was not real property and took no action.

Sources: BBC | MSNBC | ABC News | Guardian Unlimited | Sydney Morning Herald | RPGamer | The Register | Taipei Times