Gold farming

Not to be confused withgold mining.

Gold farmingis the practice of playing amassively multiplayer online game(MMO) to acquirein-game currency,later selling it for real-worldmoney.

Gold farming is distinct from other practices in online multiplayer games, such aspower leveling,as gold farming refers specifically to harvesting in-game currency, not rank or experience points. The actual labor mechanics of these practices may be similar, and those who hold employment as gold farmers may also work as power levelers.

While most game operators ban the practice of selling in-game currency for real-world cash,gold farming is lucrative because it takes advantage ofeconomic inequalityand the fact much time is needed to earn in-game currency.Rich players fromdeveloped countries,wishing to save many hours of playing time, are willing to pay substantial sums to gold farmers fromdeveloping countries.Gold farming has also been linked tocredit card fraud,with game accounts used for gold farming being paid for with stolen credit cards.

The term has also been used to describe the wait times and chore-like activities players may perform in somefreemiummobile phone games, allowing them to play without paying fees.

History

What began as acottage industryin the late 1990s became increasingly more commercialized in the 2000s with the growing popularity ofmassively multiplayer online games.

While in the past players usedeBayandPayPalto sell each otheritemsand gold from games likeUltima OnlineandLineage,contemporary, commercialized gold farming may have its origins in South Korea. 2001 reports describe Koreancybercafesbeing converted into gold farming operations to serve domestic demand.This model, with full-time gold farmers working long hours in cybercafes, wasoutsourcedto China and initially served demand from Korean players.Gold farming in China was experiencing swift growthc.2004.Cheap labor from inland provinces had washed into more cosmopolitan cities, and these real-life farmers were promptly pressed into service farming gold.In 2011,The Guardianreported that prisoners in some Chinese re-education camps were forced to engage in gold farming for the benefit of prison authorities.

Gold farming has also been linked tocredit card fraud.According to the developers ofWorld of WarcraftandRunescape,most gold-farming andbottingaccounts in those games were paid for using stolen credit card numbers. Dealing with these fraudulent accounts incurs costs for the game companies not only in terms of employee time, but also monetarily in the form ofchargebackfees from credit card companies.In addition, this large-scale fraud can risk a developer's transactions being refused by credit card companies and banks, posing an existential risk to game studios.

Academic studies of gold farming have revealed that the social networks of gold farmers are similar to those of drug dealers.

Similar to gold farming, people may be hired tolevel upin-game avatars by harvestingexperience points.The termelo boostingmay refer to a similar activity in games that featuresElo rating systemor some other competitive ladder system.

Figures

While reliable figures for gold farming are hard to come by,there are some estimates of the market for in-game currency.

In 2005,The New York Timesestimated that there were over 100,000 full-time gold farmers inChinaalone, and by 2009 the number had increased to one million.And in 2006–2007, the market for suchvirtual goodswas thought to amount to somewhere between US$300 millionand US$900 million.

Another estimate, drawn from 2005/2006 data, valued the market at not less than US$200 million per yearand suggested that over 150,000 people were employed as gold farmers with average monthly earnings of US$145.This same report estimated that 80-85% of all gold farmers were from China,a fact which has led to prejudice towards Chinese players.2008 figures from China valued the Chinese trade in virtual currency at over several billionyuan,nearly US$300 million.

Rules and enforcement

Many game developers expressly ban gold farming in their game'sEULAorterms of service.In order to combat this, game developers such as Blizzard and ArenaNet are attempting to discourage third-party gold farming by implementing official real-money transaction systems within their games.For example, in 2015, Blizzard implemented in-game items and tokens that cost players real money to purchase. These can then be auctioned off to other players for in-game currencies.

Secondary effects on in-game economy

Gold farming andpower levelingcan affect a game's economy by causing inflation.They may degrade the game experience for users as was noted in a legal case againstIGE.It is often a source of annoyance for players who can find themselves being "spammed"by sellers via the game's messaging system.

These ill effects can occur whether or not such practices are sanctioned by the game operator. Citing such concerns, Activision Blizzard shut down their real-money transaction system for Diablo III in 2014.

During thecrisis in Venezuela,Venezuelans became gold-farmers and could be seen playing online video games such asRuneScapeto sell in-game currency or characters for real currency. In many cases, these gamers made more money than salaried workers in Venezuela even though they were earning just a few dollars per day. So many Venezuelans began this practice that it increased inflation with multiple game currencies.

Law, regulation and taxation

Some governments, perhaps recognizing that current regulatory systems may be ill-suited to address activities such as gold farming, have made statements concerning the sale of virtual goods.

Australia

In 2006, a spokesperson for theAustralianGovernment stated normal earned income rules also apply to income from the sale of virtual goods.

China

Gold farming in China is more pervasive than in any other country, as 80% of all gold farmers are inmainland Chinaas of 2011,with a total of 100,000 full-time gold farmers in the country as of 2005.Gold farming in China is done inInternet cafes,abandonedwarehouses,small offices, private homes and even "re-education through labor"camps.When organized as an actual informal business, they are known as "gaming workshops" (Simplified Chinese:Du híCông tác thất;Pinyin:Yóuxì gōngzuòshì)or "play-money workshops" ( đả tiền công tác thất Dǎqián gōngzuò shì). The abbreviation is đả G, where the G stands for "gold".Prisoners inLaogaicamps have been forced to engage in gold farming for the financial benefit of prison authorities.A popularmassively multiplayer online role-playing gamesubject to gold farming in China isWorld of Warcraft. The Chinese government banned usingvirtual currencyto buy real-world items in 2009 but not the reverse.

Japan

In response to increases in gold farming, in 2006 the Japanese Government urged the computer game industry to self-regulate as well as vowing to investigate this species of fraud.

South Korea

A Korean high court's 2010 ruling meant that exchangingvirtual currencyfor real money was legal in this country although subject to taxation.However, in 2012 this practice was set to be banned alongside a raft of other means to cheat in games, and gold farmers could face stiff penalties—up to $45,000 in fines and five years in jail.

United States

A United States Congressional committee investigated taxation of virtual assets and incomes derived from them in 2006,and theIRShas, in its National Taxpayer Advocate's 2008 Annual Report to Congress, expressed concern that virtual worlds are a growing source oftax noncompliance.

Venezuela

Due tohyperinflation in Venezuelaand the devaluedVenezuelan currency,popular MMOs likeRunescapeandTibiahave been subject to mass gold mining. InReddit,a user published a racially abusive guide on how to kill Venezuelans in the “player-v-player”places where the gold farming takes place; the guide was followed by intemperate comments. The moderators removed the post and the comments afterwards.Considering many gold farmers utilizeBitcoinas an intermediate currency,regulation or taxation isn't feasible at the moment.During the2019 Venezuelan blackouts,RuneScape's trading market suffered a "economic crisis" due to the reduced number of goods, as Venezuelans could not access the game.

Lawsuits by game companies

Zynga,the makers ofFarmVille,filed a lawsuit to stop online sales of its in-game currency. The lawsuit never went to trial.

Jagex,the makers ofRuneScape,have engaged in legal actions against several gold farmers andbotprogrammers.

On February 1, 2008,Blizzard Entertainment,the makers ofWorld of Warcraft,won a lawsuit against In Game Dollar, trading under the name Peons4Hire. The court ordered an injunction that immediately halted all business operations within said game.

Game sweatshop

A business producingavatarsand in-game currency inMMORPGsis sometimes labelled a game sweatshop.Workers employed by these companies either collect in-game currency (known as gold farming) or generate high-levelavatars (known aspower leveling).Such organizations are referred to as sweatshops because the gold farmers are usually paid very low wages.

Development potential

Gold farming has been discussed as a tool for socioeconomic development by the United Kingdom's Department for International Developmentand University of Manchester professor Richard Heeks.The money involved is small enough to flow easily from many first-world players but large enough to make a difference to the people doing the work. Gold farmers receive a higher percentage of sale revenue from their work than do farmers offair trade coffee.

In the media

Neal Stephenson's 2011 novelReamdehas a plot centered on an online game that encourages gold farming.

Cory Doctorow's 2004 short story "Anda's Game",2010 novelFor The Win,and 2014graphic novelIn Real Life(based on his short story, "Anda's Game", and illustrated by Jen Wang) include references to gold farming.

Alan Harris's radio playThe Gold Farmerwas broadcast onBBC Radio 3as part of The Wire series on February 6, 2010.It features a man who plays an online role-playing game and whose next door neighbour is a gold farmer.

A 2006 art project byUBERMORGEN.COM,Chinese Gold,used found video andmachinimato document and explore the Chinese gold farming phenomenon.

Julian Dibbell's 2006 bookPlay Money: Or, How I Quit My Day Job and Made Millions Trading Virtual Lootchronicles the author's efforts to earn so much virtual money playing online games that he could quit his day job.

Discourse

In the gameWorld of Warcraft,friction resulted from U.S. players of the 2004 release finding themselves competing with Chinese-based players who were employed to generate in-game resources to be sold on trading sites.In addition to these differences in play style, the game had no translation features for in-game chat and therefore there was little communication between English-speaking and non-English speaking players.In her analysis analysis of gold farming, media scholarLisa Nakamurawrote that although "players cannot see each other's body while playing, specific forms of game labor, such as gold farming and selling, as well as specific styles of play, have become racialized as Chinese, producing new forms of networked racism that are particularly easy for players to disavow."

See also

• Digital currency
• Blockchain game
• Powerleveling
• Virtual economy
• Virtual goods
• Cheating in videogames

References

General

• Heeks, Richard (2008)."Current Analysis and Future Research Agenda on" Gold Farming ": Real-World Production in Developing Countries for the Virtual Economies of Online Games"(PDF).Development Informatics--Working Paper Series.28.United Kingdom: University of Manchester.