China Unveils New Gaming Regulations

Estimated read time 1 min read

Chinese regulators have announced rules aimed at curbing spending and rewards in video games, causing panic among investors. Online games are not allowed to provide rewards for daily logins, first-time and repeat in-game purchases, or the promotion of expensive transactions involving the speculative and auction sale of virtual goods. They also must alert users to sales techniques that promote unreasonable consumption patterns and must set recharging limits for consumers. Additionally, the regulations mandate that it will be necessary for game publishers to keep their servers in China.

Investors were alarmed by the measures, which caused China’s two largest gaming companies to lose around $80 billion in market value, with Tencent sliding 12.4% and NetEase losing 24.6% on this news. The new regulations prohibit providing probability-based lucky draw features to minors and place spending limits on players’ digital wallets for in-game purchases. Through January 22, 2024, the administration will be accepting public feedback on the regulations. The gaming industry in China experienced a growth in revenue of 13% in 2023.

DISCLOSURE: All our E.F team members come from an investment background. Apart from writing articles about companies, investments and financial instruments, we also invest in most of them. Please read our terms of use for more details.

E.F Team

Our team at Eastern Finance is made up of young and knowledgeable professionals who are here to provide you with business news from an eastern perspective.

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