China's Game Studios Bet $200M+ on Literary IP Adaptation
CreateAI and NetEase are investing $200M+ in wuxia literary adaptations, signaling how Asian studios compete globally. Black Myth: Wukong's success sparked this AAA production arms race.
Two of China's biggest gaming studios are placing multi-hundred-million-dollar bets on classic literary IP, signaling a structural shift in how Asian studios compete for global entertainment market share.
China's Wuxia Arms Race Takes Shape
CreateAI is developing Heroes of Jin Yong, an open-world action RPG covering all 15 novels by legendary wuxia author Jin Yong. The studio describes its budget as "hundreds of millions of yuan," internally benchmarked against Western AAA titles including Elden Ring (US$200 million over five years) and Cyberpunk 2077 (US$320 million over seven years).
NetEase has separately committed 800 million RMB (~US$114 million) over four years to She Diao (Legend of the Condor Heroes), its own Jin Yong-inspired open-world title set in the Song Dynasty. The two projects confirm that competition for wuxia literary IP is now a multi-studio, multi-hundred-million-dollar race.
CreateAI CEO Lu Cheng described Heroes of Jin Yong as a "huge software engineering project," citing challenges across visuals, combat, and resource management.
Scale Designed to Signal Global Ambition
The game's 960 sq km open world is positioned as 10 times larger than both The Legend of Zelda: Breath of the Wild and GTA V. CreateAI has also built Asia's largest motion-capture studio, a 2 000 sq m Beijing facility equipped with 130 cameras, raising the barrier to entry for rival studios.
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To manage costs at this scale, CreateAI uses its proprietary Animon.AI toolset, which the company says reduces production costs by up to 70%. The 400-plus-person development team includes international contractors from Japan and Poland.
On February 1, 2026, CreateAI released its first public gameplay trailer, which earned praise from Castlevania producer Koji Igarashi for its "worldwide wuxia potential."
Black Myth's Breakout Drives the Investment Wave
The direct catalyst for this investment wave is Black Myth: Wukong's 2024 global commercial success. Its performance demonstrated that Chinese cultural IP, executed at AAA production quality, can achieve international crossover appeal on PC and PlayStation 5.
The institutional infrastructure supporting these bets has also matured. The Guangdong-Hong Kong-Macao Greater Bay Area's copyright marketplace recorded over RMB 25 billion in transactions in 2023. China's 2025 Intellectual Property Nation Building Promotion Plan and the "Sword Net 2025" anti-piracy initiative provide additional regulatory protection for studios committing large sums to literary IP rights.
Financial Risk Remains Significant
CreateAI's IP position is formidable. Co-founder Chen Mo spent four years negotiating the first full authorization of Jin Yong's complete literary catalog in 20 years, securing global adaptation rights that no competitor has replicated.
However, the financial risk is equally significant. CreateAI reported losses of US$354 million in 2024, the year it rebranded from autonomous vehicle company TuSimple to AI and gaming. The full Heroes of Jin Yong launch is not expected until 2028.
To offset development losses, CreateAI is monetizing its AI and IP assets through the Animon.AI anime generation platform, the Breath of You mobile game, and the ACG Fans community platform, targeting profitability by early 2026. Investor projections target US$800 million in revenue by FY2027, with Heroes of Jin Yong anchoring a broader pipeline that includes a Three-Body Problem adaptation planned for 2027.
Heroes of Jin Yong's planned 2028 release will serve as the primary test of whether billion-yuan literary IP adaptation can deliver returns at the scale these studios are projecting.
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