With the news of the Auction House shutting down in March, and lots of previews about what to expect in Loot 2.0, there’s been a lot of debate about the future of the Diablo 3 economy. As often happens when economic news breaks, Azzure and I traded a bunch of IMs about the topic, and as usually happens, we found ourselves in disagreement about one of the core issues. Will gold retain value in Diablo 3’s future, and especially in the Reaper of Souls expansion pack?
This article covers the use and value of gold in the future of Diablo 3. I feel that gold will become much less valuable in the future of Diablo 3 than it is now, since without an Auction House and with self finding emphasized, the power/value of millions (or billions) of gold will be much less than it is today. Azzure disagrees and feels that gold will retain much of its use and value in the future, and continue to function as a currency and a commodity.
In any event, the whole system of existing gold might be gutted by a clean economy ladder system. (In fact I rather expect that’s what we’ll see.)
Click through to read our longer form arguments for these positions, weigh your opinion in a vote, and speak up in comments.
- Disclaimer: Both the pro and con arguments are extrapolations for the future state of the game based on current information mixed with speculation. The developers can (and probably will) make additional changes and tweaks to the game and the economy between now and then, which might invalidate some portions of these arguments.
Gold Will Retain Value in Reaper of Souls
Azzure: I think gold will probably retain its status as primary currency, despite the removal of the AH.
It is in Blizzard’s and every player’s interest to keep gold as a currency.
Why? Look no further than D2. Without a currency, you cannot effectively trade. So I hear you saying, “so what if it’s in our interest, doesn’t mean that it’s going to happen.” This is true, but the fact that it is in everyone’s best interest means that Blizzard will likely push hard to keep gold valuable. They will try to make players want it, need it and value it.
So now you are saying “Ok, so its in our best interest and they are going to try. But what can they do to achieve this?”.
Great question, they can do many things. Firstly, they can design the artisan system in a smarter way that makes it ALWAYS useful. In D3 vanilla, crafting was a failure, nobody really used it because the AH made it obsolete. Guess what, the AH is no longer there! So gold will have a greater use for crafting, and crafting will be somewhat desirable for a longer time (perhaps forever). This will ensure that there is a meaningful gold-sink for gold.
And don’t forget the Mystic! She will have some pretty valuable things she can do, and it all costs gold.
If inflation gets too high, and the physical quantity of gold gets out of control, Blizzard can easily implement a tier-based currency. Eg. 1 Platinum = 10k gold. Like in WoW.
Now let’s look at some case studies of places where gold worked as a currency, and places it did not.
World of Warcraft
Firstly, WoW has had a gold-based currency for many years, and it is still the primary currency. WoW is similar to D3 RoS in the sense that you can no longer get the best items in the game from an AH, so it’s a good comparison. Did this fact make gold useless in WoW? Nope.
The second case study is an example of where gold failed. Yep, you guessed it, Diablo 2.
Why did D2 gold fail? Well, several reasons:
- Gold had a very low cap.
- You dropped gold when you died, making it lack security.
- There was really nothing all that meaningful to spend it on.
The lack of an AH is not why D2 gold failed. The things above, are. And all of those things have been “fixed” in D3.
- Gold has a generous cap that most people will never reach.
- Gold is permanent, even in HC deaths!
- There are artisans that primarily need gold to use.
So, looking at the WoW and D2 example, it’s easy to conclude two things. 1) An AH that facilitates trading of gear is not required to keep gold valuable and as a currency, and 2) Gold failed in D2 because of other non-AH related reasons.
Coming to my final point, Gold is the best option for a currency for many other reasons. It is easily divisible, it is numerical, it is a commodity, and it has precedence as a currency. In other words, there are no reasons why gold wouldn’t continue to be a currency post-AH. It is the best option.
A lot of people will fall for the argument “Gold will suck because look at how much is already in the economy!! Everyone is rich, so no one really wants it, therefore it will fail without the AH.”
Why is this argument a fallacy? Because it fails to grasp what a currency is, and what a commodity is. A currency is a way of standardizing the value of goods in to a unit that is easily transferable. What does that mean? It means that it represents real things that people want to buy, and people want to sell. In D3’s case, items. So whether there is 20 trillion gold or just 1 million gold in the economy, it is irrelevant. Because gold only represents wealth. So if there is more gold, it simply will cost MORE gold to buy it. It doesn’t make it any less useful as a currency, unless those 3 things I wrote above come in to play.
In other words, Gold also doesn’t need to have a tangible value to be valuable. It is a representation of wealth. However, in D3, gold is ALSO a commodity. This means that it actually does have tangible value, it lets you repair your items, craft, use the Mystic etc. This makes it even stronger as a currency. But even if gold had virtually no use in D3, it should still be the primary currency (think WoW), and should be used as a means to facilitate trade.
In closing, the death of the AH doesn’t change anything for gold. If people still wish to trade, they should and will, still use Gold as the primary currency.
Gold Will *Not* Retain Much Value in Reaper of Souls
Flux: Based on the current information, I think gold will lose most of its value in the future of Diablo, and especially in Reaper of Souls. I’m not claiming gold will become useless, D2 style, where players don’t even bother to pick it up… though that would probably be the case already for some players, if Pickup Radius didn’t do that automatically. But I think the current state of the game, where most players instantly value every item based on a gold value, will be a thing of the distant past come Reaper of Souls.
I predict this based on the likely impact of new/changing game features, how I think Blizzard wants the economy to evolve, and especially on the (hypothetical) rules of the future ladder system.
Gold’s Value Stems from the Auction House
The most basic argument is applicable now, not just in the future. Gold isn’t really gold any more, in terms of being a currency you require for in-game activities like repairs or crafting. The newly-added crafting recipes are fairly pricey, but the bottleneck for most players is finding enough Demonic Essences, not finding the gold or materials. (Especially since the materials can be bought in the AH.)
I strongly suspect the same will be true of future in-game expenses, like Mystic upgrades. They’ll cost gold, but also materials that can not be purchased or traded, thus limiting their uses, even for the very rich.
Gold is a wonderful thing to have now, but that’s because it’s spent for gear in the Auction House. If you could find your own gear and all the crafting recipes were limited by finding materials that couldn’t be purchased… what would you need gold for? Players on the console now don’t put much importance on building up gold since there’s nothing to spend it on. There’s no Auction House, most players are self found, and when they do trade it’s item-for-item, via the barter system.
Loot 2.0 = Find Items, not Buy Them
One of the oft-stated goals of the future of Diablo 3 via Loot 2.0, is that items should be found, not purchased. The devs are trying to bring this about via numerous tools, some of which can be seen previewed in the “Loot 1.5” console version. I don’t think the PC version will be quite the “upgrade every run” loot deluge that the console is, but there’s clearly a big priority in Loot 2.0 on players finding gear rather than buying it.
If there’s no Auction House and we’re finding most of the gear our characters are wearing… what would you need gold for?
Limits to Trading
The devs have said that most of the top end gear in Reaper of Souls will be bound to the character or account using it. Details aren’t finalized yet, but all of the legendary items players found in the Gamescom demo were Bind on Account (BoA), and it seems that all Mystic enchants will render the item BoA. We already see that with all of the Archon level crafting recipes in D3C.
If those “more binding” designs hold through further development, what would players sell in RoS? All the high end newly-found Legendaries would be BoA, or soon become it via an Enchant. All the best crafting recipes will probably still be BoA and/or require materials that are BoA, like Demonic Essences are now. So what does that leave? Trading for mid-level gear, starter gear, and probably for some materials and gems. Gold might retain value for that, but it’s hard to see the shiny yellow metal retaining anything like its current value.
Ladder Seasons = Tabula Rasa
RoS won’t be a total blank slate, but it’s going to be close to one. Current characters and experience will carry over to the Paragon 2.0 system, but it seems unlikely that any current gear will still be top end gear once items from level 64-70 are dropping.
Blizzard has confirmed that we’ll see ladder seasons in the future of Diablo 3 and I expect we’ll get a lot more details about that come Blizzcon 2013. How will those ladder seasons work? No one knows yet, but much of the benefit of ladders in Diablo 2 is that they give the economy a fresh start.
A fresh start to the economy in Diablo 2 means not bringing over old items. I’d expect the same thing in Diablo 3, but what about the item stash, gold account, and Artisan upgrades that are shared account-wide? Wouldn’t those have to be blocked from sharing to new ladder characters, to keep the entire concept of a ladder and a clean economy from being tainted?
I can’t see how ladders would work any other way, and if ladder characters can’t bring over gold or gear… then it’s a pro and a con to my argument. Gold would be valuable to new ladder characters, who would be equivalent to D3 console characters now, but only for in-game upgrades and repairs. All current gold though, the millions or billions on player accounts… would be nearly worthless, since it could not go into the ladder economy where most players would be focusing their attention.
It seems like Blizzard wants to reboot much of the economy, post-Auction House, and while I don’t think they will go so far as to simply delete player gold, or put limits on how much players can carry over into RoS, or put all prices with a sliding scale that increased costs for richer players… they don’t need to. Not when the lure of ladder seasons can render even the largest mountains of D3C gold almost irrelevant.
I realize the vote options aren’t perfect, since you could vote 1-4 and also think 5 is true. But I couldn’t figure a way to integrate all the options in a neat sliding scale, and there’s no way to allow votes for 1-4 and/or 5, so let’s just see how this one goes.
There you have the pro and con arguments for the future of gold value in Diablo 3. What do you think is likely to happen? What do you want to happen?