Virtual Currency Extortion Leads to Three Years of Prison in China

QQ.com LogoInternationally, little has been done to establish laws around virtual currency. Just a week ago, however, a Chinese man in the Liaoning province was charged and sentenced for the extortion of virtual goods and currency within a local Internet café.

According to the Xinhua news agency, the man, along with three others, assaulted another man in the cafe, forcing him to give up various virtual goods and 100,000 yuan ($14,700) worth of the virtual currency known as QQ coins. The coins are the currency utilized by the major Chinese web portal, Tencent. It is used for the purchase of online goods and premium services for supported titles.

The sale of virtual currency within online games is a commonplace business within China. The QQ coins, like most other virtual currencies, cannot be converted back into real legal tender. Thus, the only way to turn a profit is through second-hand sale.

Based on reports from +8* | Plus Eight Star, more than 300 million people currently are playing online games in China today. The virtual goods market, as a whole, hovers around $2.8 billion, and Tencent alone accounts for approximately $1 billion of that total, with 90 percent of its revenue coming from virtual goods.

Despite the clear financial value, no law exists in China to protect virtual goods or currency. This case set a new precedent: The court ruled that the victim should be protected because he spent money on the extorted items. Under the ruling, the three men who assisted in the crime were fined. The primary defendant was sentenced to three years in prison.

This marks not only a significant precedent for Chinese law, but for the legal treatment of virtual goods worldwide.

Social Media 101

Mediabistro Course

Social Media 101

Get hands-on social media training for beginners! Starting November 10, hear from our expert speakers on the  best practices for getting set up on the major social media platforms, how to create meaningful content, and engage with your audience across sites. Register now!

 

Leave a Reply

8 Responses to “Virtual Currency Extortion Leads to Three Years of Prison in China”

  1. Jailed For Extorting Virtual Items From Fellow Gamer | Multiplay says:

    [...] InsideSocialGames.com via Boing Boing] – Thanks to our frontpage editor, Wern [...]

  2. Fraude en el Mundo Virtual | POWERPYMES says:

    [...] en el gigante mundo virtual Tencent. Un juez enterado del caso condenó al jefe de la pandilla a 3 años de cárcel por apropiarse de dinero virtual que no era de su propiedad y gastárselo y a los otros tres [...]

  3. La nouvelle couleur de l’argent « jAlias says:

    [...] Un homme arrêté pour extorsion de bien virtuels. [...]

  4. Links for 10th June 2009 | Velcro City Tourist Board says:

    [...] Virtual Currency Extortion Leads to Three Years of Prison in China [...]

  5. Virtual Goods Could be a Security Risk says:

    [...] currencies, some do look the other way when it comes to how the goods were acquired. The recent court case that came out of China earlier this month serves as an example. A man was sentenced to three years in prison for the [...]

  6. Chinese Government Bans Gold Farming says:

    [...] decision, possibly influenced by the recent case in which virtual currency extortion led to three years of prison, is expected to affect well over 300 million people in China who make part or all of their living [...]

  7. Social Gaming Roundup: Zynga Stock, Heyzap, Offerpal, PETA and More says:

    [...] Action Lawsuit Over Virtual Goods – In the past year there have been a growing number of court cases across the globe reinforcing the tangible value of virtual goods. The most recent however, is a class action lawsuit [...]

  8. Social Gaming Roundup: MyTown, China, GodFinger, & More says:

    [...] thefts as cyber-crimes and have already searched five homes in Finland. Similar in respect to the virtual currency extortain case in China a year ago, this is yet another demonstration on just how “real” the value of virtual [...]

Get the latest news in your inbox
interested in advertising with inside social games?

Social Media Jobs
of the Day

Account Executive- Healthcare PR and Social Media

Berry & Company Public Relations
New York, NY

Online Social Media Manager

WellPoint
Chicago, IL

Assistant Professor in Publishing

Emerson College
Boston, MA

Multimedia Specialist/Social Media Manager

Ohio Northern University
Ada, OH

Social Media Manager

The Culinary Institute of America
Poughkeepsie, NY

Featured Company

Join leading companies like this one and recruit from the nation's top media job seekers on the Mediabistro Job Board. Every job post comes with our satisfaction guarantee. Learn More
 

Our Sponsors

Mediabistro A division of Prometheus Global Media home | site map | advertising/sponsorships | careers | contact us | help courses | browse jobs | freelancers | content | member benefits | reprints & permissions terms of use | privacy policy Copyright © 2014 Mediabistro Inc. call (212) 389-2000 or email us