Games in China: virtual assets and localization

A recent divorce case in Beijing has provoked considerable public and academic debate across China, much of which has focused on cyber life and virtual assets in online games. According to an article published in the Beijing Morning Post, two online game enthusiasts instigated divorce proceedings after being married for two years. Both parties accused each other of laziness, including references to excessive game playing.

They became acquainted while playing online games and after they were married continued to play online games together under the ID registered by the husband. In the People’s Court of Shunyi district, in Beijing, the husband refused to give his wife her claimed share of the virtual property earned from playing games as part of the divorce settlement agreement. The couple’s fight over their virtual assets left the court with a major challenge, since this represents a new phenomenon in China. Although the divorce was granted, the court rejected the wife’s claim to the virtual assets on the ground that no laws currently exist in China dealing with the issue of virtual assets, as these have not even been valued with real world currencies. This is not the first case that concerns virtual assets in China. In the Shunyi district court alone, there were 12 relevant cases received by the court in 2010.

The importance of virtual assets to certain types of players, particularly the younger generation, is not widely understood outside of this very community. In China, the value of virtual assets has been largely ignored by many internet users and even frequent gamers. To a great many people, the aforementioned story may be regarded as some immature young adults fighting over toys in a virtual playground rather than a serious issue that concerns their own future rights. However, the virtual world has gradually permeated through the online community into the real world and established a close link between the Metaverse and physical reality, and there is always the possibility of localizing in-game virtual items.

Virtual assets is a new terminology inherent from the development of the Metaverse. In China, it is defined by the government as “a digital and immaterial form of property that exists in cyberspace, which includes the player ID of online games, virtual currencies in games, all kinds of equipments linked to the player ID and the informative products, such as accounts of e-mails and instant messaging services.”

Many people in China may or may not be aware that they have accumulated virtual assets through their everyday usage of services in cyberspace, such as e-mails, social networking websites and blogs. Nevertheless, virtual assets in online games have been widely used and traded for real money.

 The real money trade of virtual assets in games

Virtual assets, in most cases, are closely linked to avatars, or characters in the massively multiplayer online role playing games (MMORPGs), as well as other avatar-mediated cyber services, where the representation of the physical self is required.Increasingly, people have started to consider the representation of themselves in the virtual world as a second self or in the form of virtual proxies, which makes virtual assets increasingly important and closely linked to real life. In the late 1990s, as a result of the rapid development of MMORPGs, virtual assets in games started to be traded for real money, representing the point when the virtual world stepped into the world of physical reality.

Initially, the trading of virtual items in games started privately between players, which then gave birth to a secondary market and opened up a new business field. Players later put their game assets for sale on the online trading websites, such as eBay in the west and Taobao in China. Soon after realizing this emerging market, many specialized game asset trading websites were established, such as, the most popular one in China. The games operators have also ventured into this business by making items for real money and building this into the game design. Increasingly, games are free to play, but the players have to pay for the items required for game play to progress to higher levels without wasting a lot of time in passing the practice levels. 

The real money trade of the virtual assets in games has sparked controversy with scholars and experts from various fields, especially in sociology, law and economics, which have put forward different views on the potential influence and consequence of this phenomenon. However, the gamers themselves, who are directly involved or affected by this development, have focused their concerns mainly on two issues.

First, some game players consider the real money purchase of virtual assets in games as a kind of cheating and a violation of fair play. The gamers, who have spent the time and effort in developing their avatars into senior levels or obtaining virtual currencies, enjoy the recognition from other gamers. They believe that the ones who build their way up by money have broken this hierarchy in games and reduced their enjoyment in game play. Besides, in some games, gamers can also buy much more powerful equipment or obtain a certain kind of privilege, which allows them to set up hurdles for other gamers, such as freezing their screen for a certain time or blocking them from entering a certain gaming environment. This leaves the players who do not have the funds or do not intend to invest real money in games in a disadvantageous situation in the in-game competition.

Meanwhile, other gamers believe that obtaining virtual assets by real money does not affect the fairness of game play but instead provides players with the option of entering a game at their preferred level so that they can obtain their desired avatars or game characters without spending too much time playing. They believe that to achieve a certain goal in a game, the players have to spend either money or time. They also consider the privileges in games to be fair since the players paid extra for the services. It is a personal preference of each gamer to choose a game that fits individual expectations on fair play and within their financial abilities.

Second, the purchasing of virtual assets with real currency encourages the exploitation of bugs. Some gamers also believe that playing for money has polluted the purity of the virtual world, where they want to find freedom and escapism from the money-related competition in the real world. Some gamers find that the professional players who “work” instead of “play” in games have changed the original gaming experiences for other gamers, since their money-driven mindset has disturbed normal game play. Many players also complained about the non-stop exploitation of bugs and cheating programs.

On the other hand, some gamers favor the idea that players can sell their achievement in games for real economic reward. It opens new business opportunities and creates more jobs for people who have long dreamed of earning a living by playing games. Even for non-professional players, selling achievement in games may be considered as a positive motivation to obtain some economic reward after spending a lot of time and effort in games, especially when they want to move on to a new game.

After ten years of development, the real-money trade of virtual assets in games has become a reality and has been recognized and accepted by most gamers. The games producers and operators have also progressively increased their profits. However, games designers should take some consideration of the abovementioned concerns and economic abilities of the target gaming groups when pricing the assets in games and deciding to what extent the priced assets could affect game play. If the games are also aimed at the global market, it might be useful to research the degree of acceptance and development of the real-money trade of game assets in the local markets and to make certain adjustments to cater for the expectations of the local games players. Otherwise, it is very easy to lose players to other games in the same genre.

The market potential

It is particularly complex to evaluate the overall present market scale of virtual assets traded in online games, given the complication of underground trading. However, with the fast development of gaming technology and the rapid growth of the gaming industry in general, the virtual assets market has a great deal of potential.

In China, the online gamers’ population has been increasing progressively every year. According to the 2009 Chinese Game Industry Report, there are 65,870,000 online gamers in China, which has soared by 33.46% from 2008. Among the overall online gamers, 37,150,000 have spent money in online games. Given that 90% of the online games are free to play, it is positive to see 56% of the online gamers preferring to spend extra money to purchase game assets. The latest 2010 figures have not yet been released, but it is predicted that by 2014 the number of online game players will reach 123 million and paying users will go up to 75,280,000.

At the same time, the price of single game items for sale in the secondary market has also been increasing. According to the latest data from, the most expensive game character to buy is San Jie Huan Qin Lian, a character from the game Perfect World, which costs RMB 28,000 (approximately US$4,246). Not only are the conventional virtual items, such as weapons, tools and virtual currencies, put up for sale, some other related assets, such as account numbers, are also popular in the Chinese market — for example, certain account numbers of Tencent QQ, China’s most popular online instant-messenger, which is also linked to many online games and other services. It is free to register for a QQ account; however, one has to pay extra if he or she wants to have certain lucky numbers, such as eight or a birth date noted in the account number. It is rumored that the number 99,999 was sold for RMB 300,000 (approximately US$45,424). There are also some websites that offer an online evaluation of QQ numbers, which assists users with making a quotation of their QQ numbers, especially if they want to put them on the market.

In China, the virtual currencies from online games are also widely and closely linked with other industries. For example, Tencent QQ issues a virtual currency called Q coin. Users can use Q coins to play various online games, personalize the users’ interface of their QQ messengers and pay for other online services, such as anti-virus software. The users can purchase Q coins with real money; however, Q coins can also be rewarded for free when users go to the appointed cinemas or participate in certain activities such as online surveys. Recently, Q coins were even offered by the police as rewards to encourage netizens to report clues in criminal cases.

Legal issues

With the booming development of the online gaming industry and virtual assets in games being attached with real value, the legal protection of virtual assets has become an important issue. It is crucial for games operators to pay close attention to the legal status of in-game goods, since the number of cases regarding disputes in the virtual assets trade has been increasing dramatically each year. Some countries have already legalized and regulated the possession and trade of virtual assets, such as South Korea, whereas in many other countries there are still no laws specifying the legal ownership and property characteristics of virtual assets, for example, in China.

At present, the cases regarding virtual assets in China, such as the theft of virtual items in games, are mainly resolved by The General Rule of Civil Law together with Contract Law and sometimes the Law of the People’s Republic of China on the Protection of Consumers’ Rights and Interests. The rights and responsibilities of the game players and operators largely depend on the agreements or contracts made between them when an account is registered for a game. In 2007, a gamer sued Shenda Interactive, a Chinese game producer and operator, for having removed his virtual assets from his account. The local court believed that it was the responsibility of the game operators to maintain accurate data of the gamer’s virtual items; therefore, Shenda Interactive was ordered to relocate the game items to the gamer’s account and pay RMB 5,000 by way of compensation for emotional damage. However, it is sometimes very difficult to define the real-money value when game assets are stolen.

Considering the need to legalize online games and virtual assets in recent years, the Chinese government has published a number of regulations, such as the “Circular on Strengthening the Administration of Virtual Currency for On-line Gaming,” issued by the Ministry of Culture and the Ministry of Commerce in 2009 and the Interim Procedures on the Administration of On-line Gaming issued by the Ministry of Culture in 2010.  However, the issues related to virtual assets are not specified and an official legalization of virtual assets in China is still anticipated.

In this uncertain legal environment before comprehensive legislation has been developed, it is crucial for both game players and games operators to pay close attention to the existing laws to protect their ownership rights with respect to virtual goods and other related issues. 

Localization of virtual assets

The globalization of the gaming industry has made games localization one of the most dynamic business enterprises. In the Chinese market, imported games such as World of Warcraft and Dungeon Fighter Online have been favored by Chinese gamers for many years. Although the number of domestic online games has been developing rapidly, foreign games still take up a large portion of the Chinese market. Meanwhile, Chinese online games have also been progressively exported to the world market. The localization of games in China has been conducted both into and out of Chinese. The virtual assets in games have brought substantial profits to the gaming industry in China, which deserve more attention in the localization process in both directions.

One of the biggest challenges in localizing virtual items in games is cultural differences in different markets. Although games assets are commonly viewed as function-oriented and straightforward, they are actually very culture-bound in many cases. If games players do not like the design or cultural references in the items for sale in games, they may feel that they are forced to buy something ugly or weird just for the sake of continuing the games. Whereas, if they are truly in favor of the culture in the games assets design, they will be more willing or even passionate in buying games items, even those that are not totally necessary for the games play. There are some cultural reference points that require more awareness in the localization process of virtual assets into and out of the Chinese market.

Nowadays, virtual currencies are very common in nearly all types of online games. The naming of the currencies in games is surely worth some consideration. For real life-based games, the currency normally has to be compatible with the country or region in the background story. Players may find it odd if they are defaulted to use dollars to play Mahjong online, although the dollar does not necessarily refer to US dollars. For history-related games, the currency should match the historical period. Although history-related games cannot be equated to history books, it is strongly recommended for the game designers or localizers to do some background research of the currencies used in the particular historical periods in games, since there will be history-absorbed players who would notice every detail in games. It is always a good opportunity for them to boast their knowledge on games forums by giving examples of mistakes found in games. Some obvious mistakes, among others, include the euro currency appearing in background stories that happened before 2002. For fantasy-based games, the currency should be unconnected or vaguely related to the reality, to add more mystery. 

Weapons and tools, in most cases, are crucially functional in games. It is essential to have them well designed, properly named and reasonably priced so that players would enjoy the experience of possessing and using them in games and not find them problematic. However, the naming and types of weapons and tools can be very different in different game genres and between the east and the west. For example, the weapons in most fantasy-based Chinese online games are named in accordance with Chinese stories, while the tools, such as recovery potions, are named after Chinese medicines. It is easy for Chinese gamers to remember the names and figure out the usage of the weapons and tools, which may, however, sound and look alien to Western gamers. Meanwhile, many weapons and tools in Western games are names with concepts from magic that may not be familiar to Chinese gamers. Usually, the players do not have the time and patience to check the stories behind each weapon or tool. All they want is to remember their functions and usage and to apply them to the game play more easily and quickly. In some cases, it might be necessary for the localizers to modify the translation of certain names to make them universally acceptable.

Clothing has increasingly been drawn to the attention of players in role playing games, where the avatar presents a second self of a gamer. In China, costume games, such as the QQ show, are gaining massive popularity, especially among female players. Although each piece of clothing costs only 5 to 20 RMB, a gamer can easily spend hundreds each month on updating a wardrobe to keep abreast with the fashion. Overall, it can bring substantial income to games operators, as many gamers consider it fundamental to dress their “virtual self” in such games. Therefore, it is essential for localizers to provide “trendy” translations of the names of costumes and accessories. For example, in the virtual communities, a handbag is widely called 包包 (Bao bao — literal translation: bag bag) instead of the conventional translation 拎包 (Ling bao — handbag). However, the localization of clothing is eventually determined by the games’ genre and the marketing strategies of games operators. 

Numbers might not be something noticeable or essential for Western gamers, but they do have a powerful effect on Chinese players. They would spend extra money to get game assets with luck numbers, such as eight, in them. Meanwhile, number four, which phonetically sounds like the word death, has always been hated, especially in certain types of games, such as first-person shooting or war games.

In many games, players can have an option of having one or more pets. Some of the pets can actually help players in their game play, while some of them are just companions. Most of the pets in online games take the image of certain animals; however, animals can have different implications in different cultures. For example, bats symbolize happiness in China, which is not the case in other cultures. It is important for localizers to be aware of these cultural references and to make any necessary changes, since some animals might be seen inappropriate or bizarre in certain cultures to be considered as pets.

The real money trade of virtual assets in games has established a link crossing over from the Metaverse to the real world. The trade of virtual items in games has opened up new business opportunities and brought substantial profits to the industry. More attention, however, is needed in the designing and localization of the virtual assets in games and the virtual world.  M


Lehdonvirta, Vili. “Real-Money Trade of Virtual Assets: New Strategies for Virtual World Operators.” In: Virtual Worlds, Mary Ipe, ed. Hyderabad: Icfai University Press. 113-137.

Manninen, Tony. “The Value of Virtual Assets – The Role of Game Characters In MMOGs.” International Journal of Business Science and Applied Management, 2. 1 (2007): 21-33.