Tencent and other major Chinese gaming companies’ shares fell on Tuesday after a state-run media story referred to online games as “spiritual opium.”
The criticism raised investor concerns that online gaming will be the next target for China’s communist overlords, who have been cracking down on Big Tech and other powerful sectors deemed out of control.
The Economic Information Daily, a division of the government’s Xinhua news agency, expressed concern about “widespread” internet gaming addiction among minors.
“The harmfulness of games has been widely recognized by society, and they are frequently referred to as’spiritual opium’ and ‘electronic opiates,'” the report stated.
According to the essay, “no industry or sport should expand in such a way that it destroys a generation.”
Tencent, one of China’s largest tech corporations and the creator of “Honor of Kings” and other global blockbuster games, had its stock drop more than 10% in Hong Kong shortly after the piece was published.
Rivals NetEase and XD Inc also fell, dropping more than 11% in Hong Kong.
The repercussions were felt in Japanese gaming equities, with shares of online game company Nexon falling more than 9% in Tokyo.
China has startled investors worldwide with a series of crackdowns on digital firms, claiming national security, data privacy, and monopolistic concerns, as well as the effects on society in general.
E-commerce, education, music streaming, and ride-hailing are just a few of the industries that have seen their share prices plummet by billions of dollars.
Tencent’s super app WeChat, which is used for everything from chat to bill payment, said last month that it would block new user registrations until early August for a security upgrade, fueling concerns about its future.