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Gambling, EVE Online, and the influence of RMT

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Anyone who wasn’t around EVE Online in 2016 might not remember this, but there was a major kerfuffle in the game’s community over a popular gambling website that used the in-game currency, ISK, and it eventually got way out of control. The problem eventually got so impossible to ignore within the community, that the assumed RMT mechanisms run by player groups became memes unto themselves.

So why is this an important footnote in the history of the best sci-fi MMO on the market? Because the mentality of an EVE player is something that’s much more unique compared to the mentality of say a player in other MMOs like World of Warcraft. I mean really, how many MMOs can you have these kinds of stories about?

So the question remains as to what influence IWISK and gambling in EVE Online had on the game. The answer is obvious, and is a mixture of both positive and negative aspects.

After all, the IWISK banking cartel helped fund a war against the ClusterFuckCoalition (CFC) after a member alliance (SpaceMonkey’s Alliance) was allegedly involved in a scheme to steal ISK from the gambling site. And all of this happened while IWantISK was subject to increasingly damning allegations that bankers for the service were involved in RMT. Allegations that CCP had investigated previously. That war became infamous in EVE’s history for it was the first major defeat suffered by the CFC in many years.

We’ll write more about that war soon, but for now back to RMT.

The issue generated so much pressure, that CCP issued a permanent ban against both the IWantISK site operators and against all forms of gambling in EVE Online.

CCP continues to crack down on all forms of RMT, banning thousand of accounts each month for selling ISK and assets. The security teams has also began major pushback against all manner of bots in the game, driving up the average price of black market ISK by more than 30% on average. This banwaves are having a major impact on the bottom line of RMT operations, driving up the price of ISK for the end-user, and that’s a good thing. In short, as the “hazard discount” goes down and the price of black market ISK is less appealing, more people will be pushed toward buying PLEX directly from CCP instead.

And while it’s true that no online casino has ever started a war in a video game, there’s a lot to digest about what RMT caused the course of history that’s played out in EVE.

EVE players are a bloodthirsty bunch, and the general mantra that’s common among many players is a thirst for “content”, or more accurately the chance to blow up lots of spaceships. On the surface, this might make it seem like IWISK and RMT in EVE are a good thing, because the positive cashflow helps players stay in the game longer and spend more ISK. But that doesn’t outweigh the negative reality of such practices.

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RMT is poisonous to any game it touches. It causes massive inflation in the in-game economy, and can even turn away new players as botters and currency peddlers poison the in-game communications and external community with ads and other garbage. So why was it allowed for so long? That’s hard to say, CCP has never really explained, beyond the obvious RMT, what caused the IWISK shutdown. We don’t know whether it was just general player disenfranchisement, regulatory pressure or their own insights into what RMT was doing to the game. But all in all, it turned out for the best.

Now you might be wondering why this conclusion of RMT being bad for the in-game economy is valid, or why it matters. There have been mlitple academic attempts at explaining the RMT phenomenon and examining it’s influence on games. Dr. Edward Castronova of Indiana University penned a paper that came to the conclusion that RMT is bad for games. And this is just one example. And the underlying argumentation about RMT granting an advantage translates to more than just video games. As Dr. Castronova explains:

There is, however, a failure in the RMT market, because some welfare effects of the trade fall on others. To see this clearly, imagine playing a game like Monopoly where two of the other players engage in a side deal using their real dollars. Player A is losing to Player C, but owns Park Place. Player B is also losing but owns Boardwalk. A pays B $US50 for Boardwalk; with this monopoly, A wins the game. Doubtless, A and B are better off – A now wins the game, and B, who was losing anyway, has $US50. Yet players C and D, who were not party to the transaction, are worse off. First, Player C would have won had the trade not happened. Second, and both C and D experienced a degradation in the nature of the game itself; it became less fun. This loss of fun, more broadly, can be seen as an externally-imposed disturbance of the game, a perturbation away from the gameplay as intended by the designers. The costs are borne both by users, who get less utility from the product, and by the designers, who realize fewer revenues from the sales of games. In this, RMT is like a pollution of a service that the designers are attempting to provide to their customers. Such uncompensated interdependencies can be clearly recognized as market failures potentially worthy of some sort of policy response.”

So even if all the RMT and other illicit activities like gambling in games were to disappear, like what happened with gambling in EVE Online, the operators would just shift to a new market or racket. And the forever war against their influence in MMORPGs would continue further down the line.

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