Intermediate currency
1
Purpose
The purpose of intermediate currency is to increase spending. When users are distanced from real-world currency, they are more likely to spend more money than they would otherwise.
2
Psychological principles
Intermediate currency exploits the psychological principle of mental accounting.
3
Prevention
Users can protect themselves by setting spending limits and being cautious of enticing currency promotions.
Intermediate currency is predatory and encourages confusion
Once fiat currency is transferred into the game, it can be hard to recall the exact conversion, especially if the numbers are inflated (e.g., $1 = 2500 gems). This can lead users to not fully understand how much they are spending.Companies may combine this pattern with other deceptive practices to secure even more money from users:Only allowing bundled currency. Users can only purchase the intermediate currency in set amounts (e.g. 500, 1200) which encourages further spending.Forcing leftover currency. Altering the bundled currency and prices of in-game purchases to ensure users always have some currency left over.
Behind the pattern
Intermediate currency exploits the psychological principle of mental accounting.
Mental accounting. This principle states that we are likely to treat money differently based on where it is and how we acquire it. For example, someone might be careful about how they spend their paycheck but spend a gift card freely. This is because we associate our paycheck with the work we did, while a gift card requires no work on our part.
Despite the source of the money for the in-app purchases, having an intermediate currency erodes the attachment to the currency’s source. We no longer think of the 1000 tokens as being sourced from a hard-won workday because it’s no longer in dollars.
How to protect yourself
Set spending limits. Only add as much as you plan on spending for a specific purchase to prevent binge spending.
Be wary of currency promotions. Even if they might sound enticing, promotions touting a higher yield of currency are designed to get you to spend.