Product Type: Market Research Report
Published by: Maverick China Research
Published: April 2007
Product Code: R765-4Description In China's online world, weak payment systems remain perhaps the greatest obstacle to overall sector growth. With a banking system slow to reform, heavy restrictions on PayPal-like online payment platforms, and little credit card usage among China's online population, virtual currencies have quickly found a niche. These currencies cover a wide range of uses, from Q Coins, the standard payment for countless virtual goods and services on Tencent's QQ.com, to the gold and credits in the virtual economies of China's popular online gaming sector.
Virtual Currencies in China is the first in-depth look at the virtual currency phenomenon in China. In it we provide a comprehensive overview of all key companies and currencies. We examine a number of recent reports - virtual currencies threatening China's official currency, "gold farms" producing and selling virtual gold for real cash, virtual money laundering, and rumors of major government restrictions in the near future - and separate fact from fiction. Looking ahead, we forecast the potential for growth in virtual currencies and which companies (and currencies) will come out on top.
Key Players Covered
Virtual Currencies in China covers the following key companies and interest groups in China:
- Instant messaging and portal-based virtual currency issuers: Tencent (Q Coins), Sina (U Coins), NetEase (POPO Gold Coins), and Baidu (Baidu Coins)
- Online game-based virtual currency issuers: Blizzard Entertainment/The9 (World of Warcraft), Netease (Fantasy Westward Journey), Shanda (Woool, Legend of Mir II), and others
- Virtual currency users: QQ users, online gamers, gold farmers, and virtual currency traders
- Virtual currency exchange sites: Taobao, 5173.com, IGE, eBay China, and others
- Virtual currency regulators: China Banking Regulatory Commission, Ministries of Culture and Commerce, others
In-depth Analysis and Key Questions Answered
Below are some of the key questions answered in this report:
- How strong is user demand for virtual currencies in China?
- How will virtual currencies influence China's economy?
- How well can virtual currencies compete with other online payment systems in China?
- How will today's virtual currencies in China fare in the long run?
- How will China's government regulate virtual currencies?
- To what extent will virtual currencies become conduits for illegal activities in China?
- What role will China's virtual currencies play globally?
Table of Contents
- 1 Introduction
- 1.1 Report scope
- 1.2 Definitions
- 1.3 Why virtual currencies matter
- 2 Virtual Currencies and Their Issuers in China
- 2.1 Virtual currency creation
- 2.2 Instant messaging and portal-based virtual currencies
- 2.2.1 Tencent's QQ phenomenon: avatars, Q Coins, and Q Pets
- 2.2.2 Sina U-Coins, NetEase POPO Coins, and Baidu Coins
- 2.3 Game-based virtual currencies
- 2.3.1 Online gaming currencies traded in China
- 2.3.2 Gold farming
- 3 Virtual Currency Users in China
- 3.1 Purchasing and spending virtual currencies
- 3.2 Selling and trading virtual currencies
- 3.3 Producing virtual currencies
- 3.4 Illegal uses of virtual currencies
- 4 Virtual Currency Trade in China
- 4.1 Real money trades
- 4.1.1 Q Coins and other portal-based virtual currencies
- 4.1.2 World of Warcraft Gold and other online gaming currencies
- 4.2 Virtual currency trade companies
- 4.2.1 China-based trade companies: Taobao and 5173.com
- 4.2.2 International trade companies: IGE and Ebay
- 4.3 Virtual currency exchange rates
- 4.4 Government regulations
- 4.4.1 Main interest groups
- 4.4.2 To ban or to regulate RMTs?
- 5 A Look Ahead: The Future of Virtual Currencies in China
- 5.1 How strong is user demand for virtual currencies in China?
- 5.2 How will virtual currencies influence China's economy?
- 5.3 How will virtual currencies fare relative to other online payment systems?
- 5.4 How will today's virtual currencies in China fare in the long run?
- 5.5 How will China's government regulate virtual currencies?
- 5.6 To what extent will virtual currencies become conduits for illegal activities in China?
- 5.7 What role will China's virtual currencies play globally?
- 6 Glossary of Terms
- 7 List of Relevant Companies and Organizations
- List of Figures
- Figure 1: Tencent Milestones
- Figure 2: China’s main virtual currencies
- Figure 3: Main services offered on QQ’s platform
- Figure 4: Major tradable MMORPGs in China
- Figure 5: Gold farming and real-world salary comparison
- Figure 6: Top virtual currencies & exchange companies in China, 2007
- Figure 7: Virtual currency market prices in China (RMB per currency unit)
- Figure 8: Virtual currency exchange rates, March 2007
- Figure 9: China government interest groups for virtual currency regulation
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