New Chinese regulations could spell trouble for gacha games

New draft regulations from China’s National Press and Publication Administration (PPA) may spell trouble for the countries gacha game industry. These new regulations have three goals: to prohibit encouraging daily logins and / or spending, to warn players of “irrational consumption behavior”, and to limit how much time and money players can spend in-game.

While these regulations don’t specify the games these are aimed at, they are clearly targeted at those that either drain a lot of time or allow for excess spending. MMO’s – notorious time vampires – are clear victims of the time limitations, whereas the country’s gacha environment (renowned thanks to worldwide hits like Genshin Impact and Honkai Star Rail) are infamous for extensive microtransactions.

The impact on gaming companies as a result of this announcement is best seeable in the stock market, with the value of Tencent and Netease all falling significantly as a result. While the effects will most prominently be felt among Chinese players, the impact on worldwide users remains unclear.