The cursed demise of Habbo Hotel

Habbo / Sulake / WIRED

On November 27 2020, Alastair took a step back from the screen in his Singapore home and, as he puts it, refocused himself on the real world. The 27-year-old had finally recouped the heavy losses he’d incurred via trading on Habbo, the MMO-social network hybrid formerly known as Habbo Hotel, in the previous six weeks.
Like many Habbo players, Alastair frantically sold all of his in-game assets for real-world cash in the final months of 2020, after details of a hugely controversial update scheduled to be implemented on January 1, 2021 were leaked in mid-October.


The news sparked an unprecedented price plummet on the Habbo’s black market as players of all ilks, disgusted by the planned alterations, attempted to cash out. “Before the mass trade-off, I could’ve made $6,000,” says Alastair, who ended up salvaging just $1,500 profit thanks to a string of shrewd, last-minute deals.
These scenes may appear alien to those who last ventured through Habbo’s halls in the early 2000s. The premise of the site has remained constant: in different virtual hotels, players design rooms, play games and trade items. They can buy virtual credits (or coins) directly from Habbo and accrue them by trading items such as gold bars, which turn back into credits in their purses.
Some users visit the black market – a community of mutually consenting vendors exchanging credits for real-world currencies on Discord servers and digital marketplaces – in search of better deals. It’s frequented by a small fraction of the player base, but one that includes some of the platform’s most trusted traders.
Over the years, these veterans have witnessed their fair share of dark periods. A lack of moderation has put users in danger in the past, whereas scams, which the game’s terms of service dismiss as victim-induced ‘user errors’, are as common as you’d expect in a virtual environment purposefully designed to be hyper-consumerist.


In the face of adversity, Habbo’s loyal community typically trundles on – but accurate estimates of its size are increasingly elusive. An article in Finnish business paper Talouselämä published in October of last year claimed Habbo had 850,000 players, but judging by recent player statistics, it looks more likely to be in the tens of thousands, 70 per cent of whom are adults.
Before Habbo’s end-of-year chaos, the platform had experienced a player surge as lockdowns came into force during the early months of 2020. The platform’s population soared by 213 per cent between late February and late March, and the influx of nostalgic returnees revitalised the game’s comparatively stagnant economy.
“When a lot of older players came back into the game, it meant a lot of items that were missing for years came back into the game” recalls Alastair, who initially joined Habbo in 2004 and returned during the pandemic, likening the appreciation in value to bitcoin. “My in-game wealth essentially doubled,” says Malva, a player who co-founded The Coin Club, a 2,300-strong group created to re-energise the economy in periods of decline by setting members ‘wealth targets’. “My items skyrocketed in value due to a tonne of users coming back”.
For long-serving traders like Malva, the vibrant economy was cause to celebrate. Rosy forecasts were, however, tempered by an impending update and move away from the platform’s Flash client, scheduled to be discontinued and replaced with Unity by the end of 2020. The change had been a long time coming; Habbo’s Finnish developers Sulake first broke the news of such a plan in 2018. But few could have predicted what was to come.


“Hell broke loose when in October, it was leaked that the bartering [trading] system was going to be removed,” says Kriegberg, a former player with over a decade of experience in the game, who despaired at the decision to remove one-to-one trading, an economic cornerstone that had been in place for over 17 years. The decision to centralise trading in the official marketplace was akin to a real-world government shutting down shops and telling business owners they could only sell their goods in one, enormous state-run supermarket.
Players were angered further when this change was combined with tax hikes of up to 59 per cent on the game’s most expensive items (Sulake has now u-turned on these), an 80 per cent wealth tax on withdrawals from the new ‘Vault’ feature, and the removal of marketplace sales statistics. Agencies and corporations within Habbo, some of which have hundreds of workers, now only have a ‘donation’ function to pay their staff with, which tops out at nine credits and costs one to use. “It’s a mess,” says a spokesperson for the United States Defence Force agency (the game’s largest military simulation), which lost up to fifty users after the update yet continue to soldier on. But as disquiet amongst the platform’s old faithful simmered, the markets remained stable.
Harry, who accumulated a pre-update credit stockpile that would cost over £20,000 to purchase from Habbo directly today, says the news had little effect on an in-game economy that retained its “bullish” summer character. “Rare prices continued to rise in the months before the update because of the heightened demand from new players,” he says. Elsewhere though, the exodus had begun.
“There was a different story in the black market,” Harry says. “Around mid-October there was a complete crash and the price of a gold bar [50 credits] fell from £2.50 to as low as £0.90, driven by people desperate to get out while they still had the chance. On some sites, the supply of credits listed for sale surged into the millions.”
Jackson, who amassed 300,000 credits after rejoining Habbo around 18 months ago, takes some blame for the gold bar crash that injected urgency into proceedings. “I will admit part of this drop was my own doing. I was already in the process of selling some currency when the trading changes were announced, so I tried to be quick about dumping any leftovers I had,” he says, adding that the rapid drop forced him into selling his $15,000 worth of in-game assets for two-thirds of their value.
Fears were confirmed on October 26 with the closed beta release of the new Habbo. Sulake claimed the changes would de-incentivise black market trading and make it harder to steal items from hacked accounts, whilst centralising the economy around the marketplace would help develop selling and trading as a game mechanic.
Hundreds took to Twitter to disagree, arguing that the changes provide even more incentive to trade externally. Users believe the changes were financially motivated, and that they represent a misjudged focus on new players that has led to mass disenfranchisement.
Sulake’s auto-generated replies and inclination to redirect players to an FAQ page didn’t improve matters, a practise which persisted even as #SaveHabbo began trending on Twitter. Sulake did not respond to a request for comment for this story.
“What fuels the outrage the most is the lack of understanding and transparency from Sulake and Azerion,” says Malva, referring to Sulake’s sole shareholder, which hid critical tweets and blocked several respected players over the festive period. “What benefit could this possibly have if it was functional?” says Chaz, who’s been playing the game since 2006. “It’s all about greed and their desire to maximise profits.”
Further mutterings compounded community bewilderment. “A current Sulake employee told me they started the development of Habbo 2020 way too late,” says one player, who was a recipient of several player awards and returned to the game last year at the request of the developers. “They made a huge miscalculation because there is 20 years worth of stuff to be implemented and Unity coding is difficult.”
As the outrage intensified, players continued to head for the black market. “After Habbo announced their update, I changed my mind,” says Anz, a Malaysian player who sold, for the first time, just over $120 worth of credits. “I’ve spent too much on Habbo, it’s a waste without selling them back.”
But who’s stocking up now? Gamblers, who’ve run Habbo’s underground casinos like prohibition-era speakeasies since a 2014 ban, need capital to continue. Collectors, on the other hand, might be looking to build legacy rooms. “I sold almost half of a $15,000 chunk to collectors that came back to the game and all of a sudden wanted to buy these elite items,” says one player who was unable to shift the other $30,000 of other items and credits they had left.
With large sums changing hands and numerous ‘new’ returners, scams proliferated. “I had two separate people try to scam me by claiming I never delivered their gold bars which I’ve never had happen before in the hundreds of sales that I’ve done,” says Aaron, a 15-year veteran who managed to get a refund by recording his trade, cashing out £1,000.
But perhaps most disturbing were people actually leveraging their reputations as trusted players, forged over years, to make more on their way out.
“Users that had previously been regarded as ‘trusted’ would turn evil, no longer caring about their good reputation and scamming once given even a mediocre opportunity,” says Malva. She made $7,000 from her 200,000 credits, but says several members of her friendship group fell for scammers’ impersonations of trusted middlemen – losses total more than $3,000. Jackson also saw an increase in exit scams, “mainly from people who were given trusted roles in the trade servers because of their activity in the virtual casinos.”
Trading continued into late December as Sulake finally released the open beta for several hotels just four days before Christmas. It was bug-ridden and poorly received. The discontinuation of Flash was then postponed twice until the full switchover on January 12. The following week, player numbers decreased almost 56 per cent.
Some loyal players are setting off in search of new lands. Tomi, co-founder of one of Habbo’s official fansites, is already developing a new game: Fissio. “When we realised it wasn’t going to get any better for Habbo, I started prototyping a rendering engine for an isometric pixel art game,” he says.His plans to “focus on the most important parts of the experience” – chatting, exploring and socialising – are a reminder that the update not only destroyed Habbo’s economy, but also much of the community that made it thrive. The two are inextricably linked, and Habbo’s twenty-year story has been defined, in many instances, by how they influence one another.
Until this point, Sulake managed to retain a community of passionate players that ensured the lights were still on when the old players returned. But with feedback ignored, stocks dumped and changes implemented, Habbo’s hotel rooms may soon be as empty as their Covid-stricken, real-world equivalents.
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