Neopets is reckoning with black market pet trading

After leaving Neopets for a year, Amanda logged into her account and noticed that something was off. A bubblegum-striped tiger was crying and upset that she had left it unattended for so long. Neopets always tries guilt-tripping lapsed players like this, and usually it’s effective, but there was one problem here. This wasn’t Amanda’s pet.

What was missing was Amanda’s Darigan Lupe — a dark purple canine with glowing red eyes and dragon’s wings. Amanda’s Lupe, who she nicknamed Klyko, is not a regular pet; it’s an “unconverted” Neopet that’s massively rare on Neopets.

Klyko is devilishly cute, but that’s not where its value lies. Back in 2007, Neopets got an overhaul that changed the majority of its artwork. But some creatures, like the Darigan Lupe, kept their original designs, in this case retaining the old, static poses. The majority of Neopets’ pets were automatically converted to the new art style, which added a feature that let players customize pets with clothes, props, and backgrounds. This change unintentionally made unconverted pets very rare, propping up a new value system based on scarcity driven by the Neopets community.

Image: Neopets

Now, Neopets has a supply shortage of these unconverted pets that’s created this quick-moving economy wracked with illicit pet trading. Sitting idle for a year, Klyko had somehow been stolen from Amanda’s account and shuffled into the Neopets black market, an economy driven by the user-generated value of rare, unconverted Neopets. Amanda told Polygon over Neomail that Klyko had been stolen from her account (perhaps due to Neopets’ notoriously bad security) and passed around in trades — both legitimate and otherwise — for about a month. Neopets retain their names in trades, so she could tell he was still out there somewhere.

Eventually, Amanda got Klyko back on her account, thanks to a process called “trade reversals.” That process requires the Neopets’ staff undo a whole chain of transactions until a pet is returned to its rightful owner. Over the past few months, users like Amanda have found themselves caught up in the game’s black market, and the Neopets team has been forced to respond in a way that’s been unheard of in the community. A few Neopets users have pointed to Klyko’s heist and return as the start of a chain that’s kicked off reversals that impacted hundreds of Neopets.

Neopets is the create-a-pet website that launched in 1999 and quickly became a generation’s favorite childhood hangout — centered around the care of said pets. Now perpetually broken, thanks to Adobe ending support of Flash at the end of 2020, Neopets lacks the features that made it a huge success. Neopets saw a resurgence in players during the pandemic, but the site’s problems keep a lot of players away. Still, there are a dedicated number of players trading on the site’s boards daily.

Image: Neopets

There is usually no scarcity when it comes to user-created Neopets — players are free to create pets at will, dump them in the pound when they’re through, and make another. Neopets are customizable using paint brushes that change their design; for example, there’s a grey paint brush that drains the color from Neopets and makes them look pitifully sad. There’s a paint brush to make your pet look like royalty, ones for most colors of the rainbow (including a full-on rainbow pattern), and a marble paint brush to turn them to stone. These brushes typically cost millions of Neopoints, the game’s currency, which leaves them at differing rarity levels. But anyone can buy a paint brush with enough Neopoints. Unconverted Neopets are different — there are only a small number of them left in the game’s digital world.

Back in 2007, players with these select pets were given the option to convert them or keep the original art. Folks who chose to convert, or had them automatically converted, were given the ability to customize their pet portraits in new ways. Converting gave Neopets players the ability to further interact with their pets, but it was important for another reason: It was also a new way for Neopets, then owned by Viacom, to make money off the site. Clothes and other customization items are largely bought using Neocash, an in-game currency purchased with real money. One hundred Neocash is equal to $1, and items range in price from around 30 Neocash into the hundreds.

The Neopets team intended for customization to be a boon for the community, something to be excited for after “frequently and adamantly” requesting it since the site launched, according to former Neopets staff member Snarkie.

“[Customization] added much more extravagance and uniqueness to your own Neopet than the static art of the old days,” Snarkie wrote in a Q&A on her website. “So we didn’t really see conversion as taking something away so much as giving something new and different … but still, some people did feel that way.”

The economy around unconverted pets has continued to grow and evolve over the years. In the earlier days, there was no “legal” way to trade Neopets — you had to coordinate a transfer with another player at the Neopets pound, where players drop off unwanted pets. The receiving party waited to pick it up the moment it was dropped, a move that often failed and was considered very risky; the Neopets pound was not designed for secure trading. Some players ended up converting their pets, too, unaware of the future value it might have. Over the years, as Neopets accounts were abandoned or players lost access, unconverted pet stock became increasingly limited.

“[Neopets staff] hoped that by limiting the pool of pets that didn’t automatically convert, people would naturally let them die out by repainting them or leaving Neopets,” longtime Neopets player Zelle told Polygon. “What instead happened was that they became the unobtainable commodity.”

Eventually, Neopets added a feature that let players “trade” pets between each other. Neopets can only be traded for other Neopets, and people are limited in the number of transfers they can make each month, depending on how old the account is. Soon after, Neopets players created a 10-tier value system to rank the creatures.

“In the spirit of this being totally user-generated, the value tier system is completely fake, in a way that no other economy on Neopets is fake,” Erin Valerio, a Neopets player and trader, told Polygon. “It is totally driven by the demands of the community. A couple times a year, maybe three times a year, a group of volunteers polls the entire trading community and people will vote on what they perceive the current value of these pets to be. It’s a collective effort.”

The whole system is complex, and trading happens slowly as players incrementally increase the rarity of a pet they have until they reach their goal. It takes a long time, and it’s hard to crack into if you don’t already have an unconverted pet.

And so, a black market for pet trading has existed for as long as unconverted pets have been desirable. On the black market, people can pay real money (or, sometimes, other currency) to purchase an unconverted pet — one that may have been obtained through illicit means. The Neopets website has notoriously bad security, and it has a huge number of inactive accounts that never get purged, like they might at more active websites. In 2016, Neopets, now owned by JumpStart, was hacked and tens of millions of accounts were breached. Information was posted on the internet.

One Neopets user Polygon spoke to said she was able to download the information and has used it to help people get into their old accounts. But other people have used this information to steal unconverted pets and sell them on the black market. Unconverted pets can go for hundreds of dollars, depending on their rarity ranking.

Image: World of Neopia

“There’s always been a black market,” Valerio said. “There’s always been places where you can go and purchase a UC pet and have it discreetly transferred to your account. What you do with it, that’s up to you. Everybody knows that this exists. There’s a joke on the Pound Chat that anything can be compromised.”

Occasionally, when the Neopets team discovers that a compromised pet has been circulating in the trading community, it will do something called a “trade reversal,” moving the pet back to its original owner. If only a single trade has happened since then, it reverses that last trade. But the problem is that trading happens quickly on Neopets. A trade reversal that happens 10 trades down the line will impact a number of players and their trades. In late 2020, a major reversal shook the Neopets trading community in a way that Neopets staff could no longer stay quiet on.

This is where Amanda and her stolen Darigan Lupe, Klyko, come in. A few Neopets users pointed to Amanda’s experience as the start of the current disaster. Amanda told Polygon she asked around the trading community about Klyko when she returned from a Neopets hiatus. She asked the user who currently had him not to trade him while she tried to contact the Neopets team.

“I surmised that a longer chain of reversal would’ve been more difficult should he be traded again, and it had already been a month since he was stolen,” Amanda said.

The Neopets team started reversing trades to get Klyko back to Amanda, and eventually, he was safely returned to her care.

Image: Neopets

Regardless of whether or not this was the reversal that started it all, it’s events like these that plague the trading community, and have for a while. To return a Neopet to its owner, the Neopets team sets off the chain of reversals, which some players estimate have affected hundreds of pets. In the shuffle, which players report is done by hand by the Neopets staff, some pets get lost. Some players ended up with no pet at all. Others have had months worth of progression wiped out as trades are rolled back.

The community is now angry with the Neopets staff over the response to this crisis. Typically, Neopets deals with reversals behind the scenes, in emails and chats with individual players, who then report updates to the Neopets forums or on pet websites. (One user published emails between themselves and support staff regarding a reversal which eventually ended with the Neopets staff creating a new unconverted pet, which players said staff claimed was previously impossible.)

Due to major pushback from players on the Neopets forum and social media, the Neopets team was forced to respond publicly. In a post to the forum, the staff said it’s looking at its reversal process to ensure fairness and safety. It wrote:

We’d like to address the topic of pet trade reversals, something that has recently been affecting some of our users. The safety and security of all Neopians’ pets are top priorities for us: that includes making sure no pets are illegally stolen or traded away from their original and rightful owners without their consent.

That said, we were recently made aware of a situation in which many users were unknowingly involved with the trading of an illegally obtained Neopet, stolen from their original owner without their knowledge and traded away multiple times to different users. We recognize that this is not the fault of the larger number of users involved in that trade chain, particularly those who assumed the pet was never originally stolen.

It is our goal to make Neopia a safe place for everyone, and that includes being able to play with and trade pets safely. In light of this situation, our team will be taking another look at the issue of pet trade reversals and taking steps to ensure all users are fairly treated if they are unknowingly involved with an illegally obtained pet.

Polygon has also reached out to Neopets for more information.

Players told Polygon that the Neopets team often handles things like this poorly — communication is opaque and players are often left in the dark. One Neopets user told Polygon that she was an innocent party caught up in a compromised trade and had her account frozen, despite providing staff with proof of her legitimate trades. And she’s hardly alone.

“We’ve put years of our lives, and a lot of serious negotiation and effort into working our way up this weird ladder that doesn’t really exist,” Valerio said.

Update (March 9): A Neopets representative provided Polygon with the following statement.

First and foremost, the safety of our users and their accounts and pets is our top priority. If we find a situation where a pet is removed from an account without the owner’s permission, we take that very seriously. We are looking into creating additional tools to help solve these situations faster as well as alternate solutions that will minimize impact on the majority of users involved. Additionally, we’re actively making sure that those who are affected will receive fair trade-offs.

We have a support team that works on Neopets as well as other projects and when needed, can shift them to deal with high priority situations like this. A “Pet Trading” category has also been added to our support system for users to better flag these issues and get them resolved quickly.

As for UC pets, they are desirable for many reasons with their rarity being the primary reason. For some, they’re seen as a status symbol. For others, it’s the unique artwork they love.

We are always looking at improving the site and our customer support on it. As everyone is aware, Neopets is a 20 year old site that comes with 20 year old tech issues, economy changes, etc. that will always have its challenges. Preserving the site and moving away from Flash have been a huge undertaking for our team, but it’s one we’ve prioritized above all else to ensure Neopets continues. We are very grateful for our passionate and loyal userbase that has stuck by us throughout the years and will continually look at how we can improve and grow the site.