'World Of Warcraft' Tokens Lose Quarter Of Their Value In A Day, Prompt Blizzard To Exercise Damage Control

In PHOTO: A visitor walks past a placard of 'World of Warcraft' at their exhibition stand at the Gamescom 2010 fair in Cologne August 18, 2010. The Gamescom convention, Europe's largest video games trade fair, runs from August 18 to August 22. Reuters/Ina Fassbender

"World of Warcraft" tokens have lost a quarter of their total value barely a day after they went live on April 8. The tokens were priced at $20 at launch and were worth 30,000 gold. As of this writing, the token value has fallen down to 22,405 gold. That's approximately a quarter of the original value lost in little more than a day since the tokens were launched.

The new in-game items were announced by Blizzard in the beginning of March 2015 and are available for purchase by either spending real world money or by trading them for gold through the Auction House. The ability to exchange the tokens for 30 days of play time to the subscription-based MMORPG makes them an extremely sought-after item.

According to an earlier International Business Times Australia report, the tokens were introduced as a means for gamers with a lot of surplus gold to trade the same for added subscription time. Alternatively, Blizzard's take on microtranscation allows easy access to gold for gamers who have more money than time to spend farming gold the hard way. This move was the company's way to thwart the burgeoning numbers of third-party gold merchants who have been making a tidy profit catering to the aforementioned category of gamers with deep pockets.

Furthermore, Blizzard has prevented "World of Warcraft" players from trading or bartering the tokens among themselves. This has been ensured by making them soul bound to the player's character. In other words, players cannot receive or use tokens purchased by someone else. The company officially justifies this restriction as a means to prevent experienced players from cheating inexperienced ones with deceptive trades.

However, the real intention behind this move is to allow Blizzard to exercise a tighter control on the value conversion of the tokens into gold and subscription time. PC Gamer notes that the "World Of Warcraft" maker set the initial value of the $20 token at 30,000 in-game gold and then let the market forces decide the subsequent value. Unfortunately for Blizzard, the need to exercise a greater control on the token economy has resulted in a sharp decline in its value.

Since the tokens can't be traded between players, they can only be converted into gold or used to buy a month's subscription. However, spending $20 on a token to buy 30 days of subscription is absurd because directly purchasing a month's worth of subscription is significantly cheaper at $15. That means selling the tokens for gold is the only viable option. Not surprisingly, the ensuing rush of gamers trying to do just that created a massive demand-supply disparity. This resulted in a rapid decline in the market value of the tokens.

Cinema Blend points out that Blizzard is taking some measures to curb the devaluation of its newly introduced trading item. The company has decided to curb the supply by limiting the number of tokens an individual can purchase per month through the Auction House. The main factor in the massive reduction of token value is attributed to gamers rushing to purchase and exchange them for gold. Blizzard seeks to address this by restricting gamers from buying more than 10 tokens using real world money.

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