Bad news, folks: China hasn't banned gold farming after all.
Reports were flying fast and furious earlier this week about a new Chinese law that banned the exchange of virtual currency for real-world goods and services, a restriction that on the surface appeared to spell the end of the country's gold farming industry. But such is not the case: Fake money can no longer be used to buy real stuff but real money, it seems, can still be used to buy fake stuff.
"[The new law] is a government restriction on the use of the quasi-Paypal-like currencies (mainly QQ coins) that are used extensively in China to pay for virtual game stuff," University of Manchester Professor Richard Heeks explained on the ICTs for Development blog. "As announced they can now only be used to pay for virtual stuff, and you can't buy real things with them as game companies were allowing to happen, nor can you gamble. This therefore is not about what gold farming clients do: Use real money to buy these virtual currencies; it's the mirror image."
"It's not about the major trade in gold farming such as World of Warcraft, which relates to other types of virtual currency," he continued. "And it's not about buying/selling in-game items. And it's not about the power-levelling of avatars. Bottom line: It's not about gold farming."
Heeks also noted that the new law appears similar to one imposed in Korea in 2006, when the government placed a ban on the virtual currency trade. That restriction, which was drafted as a result of the large amounts of gambling and "illicit political payoffs" using the virtual currency of Sea Story, appeared to have no impact on the Korean gold farming industry.
"If this regulation does come to fruition, it will relate to finance and defense of the RNB yuan," Heeks said. "Yes, it may affect some types of games in China but, no, it as yet appears unlikely to have much of an impact on gold farming."