The Chinese government released the “Internet Game Management Measures” for public opinion, some of which may not be friendly to the development of NFT or blockchain games.
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China’s Internet game regulations may be unfavorable to blockchain game economy
Internet games cannot hype virtual assets or involve high-value consumption
Players must undergo KYC and register with real names
Internet game currency can only be used within the game
Digital RMB used to purchase game currency also requires real-name registration
Virtual asset issuers cannot exchange virtual assets for legal tender
Overseas blockchain games are regulated by other countries
Illegal operations will be fined 10 times the revenue
Is the media hyping the openness of China’s Web3 and NFT?
Article 18 of the “Internet Game Management Measures” stipulates restrictions on high-value consumption in games. Internet game publishers and operators are not allowed to provide or tolerate virtual item trading at high prices through hype or auctions. All internet games must set user recharge limits and publicly display them in their service rules. Popup warnings should be issued for users’ irrational consumption behavior.
Article 22 of the “Internet Game Management Measures” requires internet game publishers and operators to request users to provide authentic identity information when signing agreements or providing services. If a user fails to provide authentic identity information, the internet game publisher or operator shall not provide relevant services. Strict implementation of user real-name registration and login rules should be ensured to guarantee the authenticity and validity of user identity information.
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Article 23 stipulates that the use of internet game currency is limited to exchanging for the internet game products and services provided by the game itself, and it cannot be used for payment, purchasing physical goods, or exchanging for products and services from other entities. Services that exchange internet game currency for legal tender are prohibited.
Article 24 states that internet game currency transactions should be conducted through real-name digital RMB wallets, and anonymous digital RMB wallet transaction services should not be provided to users.
Article 23 also prohibits internet game publishers and operators from exchanging users’ acquired virtual items for legal tender. If they provide the exchange of internet game virtual items for small amounts of physical goods, the content and value of the goods should comply with relevant national laws and regulations.
The “Internet Game Management Measures” state that if a website or internet game server is located overseas, it will be governed by the jurisdiction of the place where illegal activities occur.
The “Internet Game Management Measures” also impose requirements on the qualifications of game companies, consumer protection, protection of minors, dispute resolution, etc. As units responsible for promoting internet games, they also have the joint responsibility of verification. Game companies need to submit annual reports to the registered government authorities.
If operating without approval, fines can be imposed up to 10 times the revenue, along with related criminal and civil liabilities.
Earlier, the media believed that the Chinese government was actively opening up the Web3 and NFT industries based on the content of the Web3 industry development proposal at the National People’s Congress, but the response from the Chinese Ministry of Science and Technology still emphasized the need to comply with the “Chinese national conditions.” All blockchain applications must comply with existing legal requirements, such as KYC, not involving legal tender, and not promoting speculation.
If China has compliant blockchain games, they should also comply with the requirements of the “Internet Game Management Measures,” which may not meet the expectations of industry insiders.
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NFT
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Further reading
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