Japan’s Financial Services Agency (FSA) has been investigating whether PokeCoins, the in-game currency being circulated within the smartphone app Pokémon Go, should be regulated under the same laws that apply to prepaid cards.
As it stands, Japanese law overseeing prepaid payment instruments requires issuers to record balances exceeding ¥10 million ($96,240) and inform the authorities.
Finance Magnates learned today that the FSA is close to reaching a landmark decision on the status and securitisation of PokeCoins, according to a report in the Financial Times.
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The FSA has not yet revealed when it will make its ruling but the outcome could mean that domestic Japanese and overseas companies whose games are available in Japan are obliged to secure the virtual money they have sold to local gamers with substantial deposits of real-world yen.
So far, the FSA is the only regulator in the world known to be considering regulation, but its decision is reported to loom over Japan-based pools of cash worth tens of millions of dollars. Yen-denominated sales of virtual currencies are particularly high in Japan as it is the world’s most valuable mobile games market.
If it is decided that PokeCoins and other virtual currencies that can be purchased in-game with actual cash should be legally classified as a prepayment system, the company selling the currency would be required to disclose the balance of unused currency held by gamers in March and September each year.
Games developers have been closely monitoring the FSA’s actions on the matter, as many of the world’s top-grossing smartphone games obtain their revenues from in-game currency sales.
While such a move may represent a bureaucratic inconvenience for games developers, the regulator is expected to strike a fair balance on the financial demands.