Currency Degradation

Monetary policy as a major electoral issue feels like a weird thing in American history. William Jennings Bryan and the cross of gold speech, bimetallism, all that — reading about it in high school, I understood that it related to farmers’ debts, but currency reform as a primary presidential issue? What?

As a gamer, especially in MMOs, this should resonate with us all now.

Games start with a currency like gold pieces. That’s the in-game currency of the land, and you use it to buy skills, swords, whatever. Over levels and time, it inflates, so you now need 50,000gp for a sword, 100,000gp to buy a skill level, and so on, but you earn 20,000gp for killing a level 214 floozle, so the gold cost is essentially irrelevant. It gets used as a measure of epeen, a currency in the millions for the auction house, and someday a potential source of a huge gold sink for housing or something.

Meanwhile, a parallel currency will be introduced at higher levels and another with events, maybe several so each area or event has its own currency. Your millions of gold pieces are worthless to these merchants because they want gems, or floozle heart strings, or perhaps uranium pieces, diamond coins, just an increasingly unlikely array of currencies.

This will happen even if the game does not introduce them as official currencies. The original Asheron’s Call quickly saw pyreal motes and shadow shards become the Real Currency of high value trade, and I believe there were eventually NPC vendors that accepted reality and demanded them in payment.

In many games, it is part of the expansion reset. Add another three zeroes onto every number like your damage is being dealt in Venezuela, but let’s switch currency from gold to diamond because it is already 50,000,000 gold pieces to buy anything. That also gives you a cash reset so people who were currently rich cannot just buy past the new content. They need to go earn the new diamond coins like the newbie peasants.

(Nowadays, games will also have a cash shop currency, which is used for premium items, but that will undergo a parallel process, just converting cash shop currency to whatever the currency of the moment is.)

So over time, the original currency becomes a running joke. As a quest reward, the farmer gives you an apple and two copper pieces. He could give you two silver pieces, or gold, or any unit of the original currency, but that only matters to the newest new players. An expansion or two in, that currency is only relevant in the tens of millions, and the real currency is whatever we are using this expansion.

If you have ever raged about having your gold stockpile made worthless in the latest expansion or had a long debate about trades being conducted in one currency or another, welcome to American politics of the Wilsonian era. If you’re in high school right now, maybe you can get a nice essay about currency use in WoW and how it relates to the silver standard.

I’m just kidding. Do high schoolers read blogs these days?

: Zubon

2 thoughts on “Currency Degradation”

  1. It’s a fairly rare occasion for real world currencies to be replaced by alternates. Gold standard to US was one big one. When the world bank steps in to control massive inflation and sets a new currency standard is a last ditch effort.

    MMOs are a great example of how not to build an economy. EQ had a horrible economy, moved almost entirely by twinks. WoW went off the deep end with WotLK and the daily quest bonanza. D3’s RMAH is a textbook case if super inflation (or perhaps D2’s SoJ economy).

    I’d be surprised if these weren’t already part of some thesis in Uni.

  2. I just want to point out that this is not quite how it worked out in WoW — or at least not remotely on the same scale as you discuss in the post.

    It’s been what, 14 years? In Vanilla you had to pay ~1000 gold to get the fastest mount. True, that was a lot of money back then, but even now 1000 gold is a meaningful amount in the game — it is on the scale of 1-hour consumable cost.

    So yes, there may have been something like 100-1000x inflation over the years but (almost) nobody’s buying anything for literal millions and there’s been nothing like replacing gold with another ‘expansion currency’ (unless you count e.g. tokens that replaced (or work in conjunction with) actual non-tradeable loot drops — but that’s an entirely different kettle of fish in my opinion).

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