I play with NFT digital collectibles—does that mean I'm involved in gambling?
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I play with NFT digital collectibles—does that mean I'm involved in gambling?
Most players will not be affected by NFT collectible platforms involved in gambling.
Navigating Web3 tides with focused insightsAuthor: Attorney Wei Fuhai, ManQin Law Firm
It's been a while since I last wrote an article. Compared to the high-output colleagues at our law firm, I haven't produced much lately. Fortunately, I'm currently handling a case involving an NFT digital collectibles platform, which gives me a good opportunity to share some thoughts on digital collectibles. These are my personal views—they may not be correct—but I hope they serve as a reference.
Recently, someone asked me: "I'm playing with a certain NFT collectible, but the platform got shut down due to gambling-related issues. As a user, am I exposed to any legal risks?"
To answer this question, we need to consider three aspects:
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First, we must define what constitutes gambling;
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Second, we must identify which features or mechanics on NFT collectible platforms may involve gambling;
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Finally, we can assess whether users like us face criminal liability for participating in such activities.
What Is Gambling?
Gambling refers to wagering money or other valuable items based on the outcome of a random event to determine wins or losses. In most jurisdictions, gambling is strictly regulated—some regions prohibit it entirely, while others permit it only under specific conditions and in designated venues.
As we can see, there are two key elements to gambling.
First, the stake must have value. For example, if during a joke you say, “If I lose, you can slap me,” that doesn’t qualify as a valid stake—unless slapping hard enough leads to medical bills, but that’s another matter altogether.
Second, the outcome must depend on chance. If the result isn't random but instead predetermined, then using your common sense, what would you call that? Fraud! Legally speaking, betting on uncertain outcomes is known as a "game of chance."
Now that we’ve clarified what gambling is, let’s move on to the next issue.
How Can Digital Collectibles Involve Gambling?
NFT digital collectible platforms offer various mechanisms, and given how creative Chinese users are, new gameplay models keep emerging. Common ones include airdrops, public mints, lotteries, whitelists, blind boxes, merging (synthesis), empowerment, and more. Among these, I believe blind boxes and synthesis-based mechanics are more likely to raise gambling concerns.
Let’s first look at blind boxes: users don’t know the exact content before purchase—the reveal happens afterward, increasing excitement and anticipation. From a legal perspective, purchasing a blind box qualifies as a game of chance. However, because this differs somewhat from traditional gambling, it typically does not lead to criminal prosecution. Whether paid in cryptocurrency or fiat currency, the payment still represents money or something of value.
Next is synthesis. Its nature is similar to blind boxes, except that instead of spending money directly, users combine previously purchased NFTs. The resulting NFT may be worth more or less than the original components. Thus, this also involves betting on an uncertain, random outcome—essentially another form of gambling.
Another popular mechanic recently—one that several attorneys at ManQin Law Firm have personally tested (played)—is the "battle royale" game mode. After trying it ourselves, we unanimously agreed it borders on gambling. In fact, we even published a dedicated article titled How Can Blockchain Games with 'Battle Royale' Mechanics Avoid Becoming Gambling Platforms? Think back to how it works—doesn’t it closely resemble the definition of gambling mentioned above?
What Should Collectible Users Do?
After discussing these mechanics that may involve gambling, some might ask: “So does that mean NFT collectible platforms easily become gambling platforms? Should I just avoid everything?”
As a criminal defense lawyer, I view all the aforementioned mechanics on NFT platforms as potentially carrying criminal risks. Therefore, whether you're an entrepreneur planning to launch an NFT platform or a regular user participating in one, my usual advice is: don’t do it. Of course, this is merely a reference—we cannot make decisions for others. Ultimately, individuals must weigh the risks based on their own judgment.
Many people might further ask: “If the NFT collectible platform I used turns out to be involved in gambling, will I get into trouble? Will the police come after me?”
Indeed, China’s Criminal Law includes a charge of “gambling crime.” Let’s examine how it’s defined—Article 303 of the Criminal Law states: “Whoever organizes gambling or makes gambling his occupation for profit shall be sentenced to fixed-term imprisonment of no more than three years, criminal detention, or public surveillance, and shall also be fined.”
First, as individual NFT users, we usually participate alone from home via computers or mobile devices—so we’re clearly not organizing group gambling. More importantly, the second element—"making gambling one’s occupation"—refers to treating gambling as your primary source of income, meaning you rely on gambling proceeds as your main or sole livelihood. In legal terms, this is known as a “habitual offender” or “professional gambler.”
In cases handled by ManQin Law Firm—whether representing users seeking redress from platforms or victims of NFT scams—most individuals aren’t depending on these activities to earn a living. They have legitimate jobs. Therefore, they do not meet the criteria of a “habitual offender” under criminal law, and thus most ordinary users won’t face criminal liability simply because the platform they used was linked to gambling. (However, administrative penalties such as short-term detention under public security regulations are still possible.)
ManQin Lawyer Summary
After all said and done, certain mechanics on NFT digital collectible platforms indeed carry criminal risks. As users, moderate participation for small gains is acceptable—think of it as earning enough for an extra chicken leg tonight. But moderation is key. Once you cross the line, the consequences may no longer be so pleasant.
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