Tue. Oct 19th, 2021

Tensed stocks are falling for fear of cracking down on games in China

On Tuesday, shares of several gaming companies, including Tencent, fell as much as 12% in Hong Kong markets. It happened after the Communist Party of China’s Propaganda Department published at the ChinaJoy expo that all video games had to be safe, transparent and reasonable. Shares of several companies, including NetEase, Tencent and XD, began to fall in response. Even shares of CMGE (China Mobile Games and Entertainment Group) began to decline by almost 22%.

A couple of video game companies in Asia, including Japanese giants like Nintendo, Capcom and Konami, also experienced success, but not as much. Shares of Tencent have recently rebounded to -6%, as the company lost a total of $ 112 billion since early last week.

Xinhua’s publications represent the official position of the Chinese government, but later, for some reason, the article has been deleted.

While the Chinese government is interested in growing its video game industry after ending the ban on console games, experts report that Xi Jinping does not look like a fan of games.

Regulations and measures

In 2018, regulators felt the potential damage of monetization within the game and suspended monetization licenses.

Tencent uses measures such as facial recognition to prevent children from playing all night. It creates 12 rules for streamers to promote healthier environments and respond directly to government regulations to keep games appropriate for children.

Companies fear they could anger regulators in China, as crackdowns could mean the destruction of entire industries.

Since then, Tencent has issued a statement promising to limit the playing time of accounts registered as children to one hour on weekdays and two hours on national holidays and weekends.

In addition to the recently announced age-based rating system for games in China, Tencent is also considering banning its games for children under 12.

The post Tencent shares fall for fears of gambling crackdown in China appeared first on FinanceBrokerage.

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