FT notes that Chinese officials are especially concerned about QQ Coins, a form of virtual payment issued by Tencent, an online messaging and games service based in Hong Kong. According to the report:
Tencent's messaging system is used by an estimated two-thirds of Chinese internet users and its QQ Coins have been accepted as payment by other companies as well as sold for legal tender.
New Chinese regulations prohibit using virtual currency for profit and mandate that such funds be used only to buy virtual goods. The government concern is partly based on worries that virtual currency is being used to skirt China strict anti-gambling laws.
In other news, Reuters reports that the Chinese government has placed a moratorium on the opening of new Internet cafes for the remainder of 2007. In its report, Reuters quotes National People's Congress official Yu Wen:
It is common to see students from primary and middle schools lingering in Internet bars overnight, puffing on cigarettes and engrossed in online games.
Minors are barred by law from China's Internet cafes over concerns about youth crime and online addiction. A 2006 report issued by the China National Children's Centre claims that 13% of Chinese juveniles who use the Internet are addicted.