China Proposes Ban on Converting Web3 Gaming Tokens to Fiat Currency: What You Need to Know
China is proposing a ban on converting Web3 gaming tokens to fiat currency, as part of a broader regulatory draft by the General Administration of Press and Publication (GAPP). Released on Dec. 22, the regulations aim to tighten control over the digital economy, particularly in the blockchain-based gaming sector. The ban, targeting financial risks and money laundering, prohibits the conversion of in-game virtual tokens to legal tender. The draft also imposes strict standards on token issuance, emphasizing transparency and reasonableness. While these measures may mitigate financial risks, experts anticipate potential impacts on the economic model and innovation within the gaming industry. The guidelines, open for public consultation until January 22, 2024, introduce 62 articles with stringent requirements for gaming companies, including mandatory licensing and a two-year data retention policy. The proposed changes could significantly reshape the landscape for developers and operators of Web3 games in China.
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