SINGAPORE - Loot boxes in video games, including mobile titles, are akin to virtual goodie bags that have random rewards.
These boxes can be bought with digital currencies earned in a game or purchased indirectly with real cash.
As a result, loot boxes are considered a type of video game micro transaction.
Loot boxes tend to be found in mobile games that are free to download but have also made their way into paid computer and console video games.
Depending on the game, these loot boxes can assume different names, such as card packs, summons and supply crates.
Games with loot boxes are sometimes also called "Gacha" games, a term that comes from the Japanese capsule toy-vending machines called Gashapon or Gachapon.
Opening a loot box is often a flashy event with lights and sound.
Some experts have argued that virtual loot boxes are more easily accessible than their physical counterparts like sticker packs because the barriers to get people to buy loot boxes are lower. This is due to their digital nature and how they are worked into a game.
Some players may also not think that they are even spending real money on them.
A loot box can be worth the equivalent of a few dollars in real cash, but they often cannot be traded for actual money.
Prized rewards from these boxes can have a low chance of less than 1 per cent of dropping, with some reportedly being as low as 0.00005 per cent.
These rare rewards can give players a big advantage in some games, such as a weapon that makes a player's character more powerful. In other instances, the rewards are cosmetic to dress up game characters.
Social workers and video game experts have raised concerns over the addictiveness of loot boxes, saying the thrill of not knowing what one might get stimulates the production of a biochemical known as dopamine which is linked to rewards and motivation. This can make loot boxes very addictive.
Such marketing tactics are seen in the real world to some degree as well, such as when online stores selling beauty products hold mystery box promotions.
Some experts have also likened the sensory triggers from the sound effects and animations of opening loot boxes to playing slot machines in casinos.
Some countries have taken action against loot boxes. Belgium banned them from games in 2018 and some companies had to pull their games from the country as a result.
The Belgian Gaming Commission began looking into the matter after harsh public criticism globally of the Star Wars Battlefront II game that publisher Electronic Arts released in November 2017.
The Star Wars game initially had loot boxes with random rewards but after the fallout from fans and gamers, they were removed.
In June this year, the United Kingdom's Department of Digital, Culture, Media and Sport launched a call for evidence in its ongoing investigation to determine whether to reclassify video games with loot boxes as gambling products.
If ministers in the UK opt to reclassify loot boxes, the decision would have a significant impact on game developers, who could be forced to withdraw some titles or redesign them so that they can be sold to people under 18 years of age.
Meanwhile, Apple and Google have required game developers to reveal the odds of getting loot box prizes in games on their app stores for iPhones and Android phones in 2017 and 2019 respectively.