Shares of several Chinese tech giants tanked in Hong Kong, after Beijing unveiled a new set of regulations to restrict online spending in the gaming industry as part of its wider crackdown.
Tencent, one of the biggest gaming companies in the world, plummeted 12.8% in Hong Kong by early Friday afternoon. The stock is on track to record its worst day since October 2008, during the depths of the global financial crisis.
Tencent could lose 380.4 billion Hong Kong dollars ($49 billion) in its value due to that drop, according to CNN calculation based on the stock market statistics. NetEase, another gaming giant, dived 20% in Hong Kong afternoon trade, poised for its biggest daily loss since first listed there in June 2020.
That fall could wipe out 106 billion Hong Kong dollars ($13.6 billion) from NetEase’s market value.
Online games will be required to set spending limits, while in-game measures that could induce high spending — such as daily login rewards — will be banned, according to the draft rules issued by the National Press and Publication Administration on Friday.
The proposed draft also stipulated that in-game measures that could lead to trading of virtual goods at a high price — such as auctions — will be prohibited, adding that large tips to players who livestream their games will also be banned.
Games should only offer real name registration to players, and game publishers should store data locally, according to the draft rule. In-game purchases have become ubiquitous and highly lucrative within the gaming sector, particularly for mobile games which are often released to consumers for free.
The move comes as China intensifies its crackdown on its massive online gaming industry, as Beijing seeks to reverse what it sees as a growing trend of gaming addiction among young people.
— CutC by bbc.com
