Virtual warfare on an unprecedented scale broke out yesterday as two huge trade cartel armadas met in the space above EVE Online’s B-R5RB system to vie for its disputed mining rights.

The damage to players’ virtual property is estimated to have cost between USD $200,000 and USD $500,000.

EVE Online is a hardcore space simulation in which players trade, build alliances and compete for resources. Just as in the real world, disputes between players and alliances are sometimes settled by force. The stakes are often higher in EVE than in other video games as a player’s in-game property holds real world value, and just as in the real world, once it’s destroyed or lost, it’s gone forever.

The dollar value of players’ property is based on a conversion of EVE’s monthly subscription, which can be paid in real-world currency or in EVE’s in-game currency, ISK.

The largest ships in the game, Titans, take weeks to build and are often valued between USD $3000 and USD $5000. Much of the more than USD $200,000 in damage caused by the battle above B-R5RB is estimated to have come from the destruction of more than 75 Titans. Before then, the most costly engagement had resulted in the destruction of just 12 Titans.

Yesterday’s action was the culmination of a conflict that had been simmering since October between two of EVE’s largest factions, Nulli Secunda and allies, and CFC and allies.

When Nulli Secunda forgot to make a rental payment on a space station in the B-R5RB system, its rivals swooped in to claim it for themselves. A cold war developed over the system as both factions and their allies amassed forces, and neither appeared to show any willingness to back down.

Reports vary as to who fired first, but within moments, ships of all sizes were caught in a conflagration of missile and laser fire.

Nulli Secunda initially edged the upper hand in the battle, but as more of CFC’s American playerbase came online in the North American morning, it was able to turn the tide in its favour.

The economic fallout from the battle is already being felt as the price of the in-game resource tritanium has begun to rise.

EVE developer CCP said it is still “digesting” the numbers, but it estimates more than 4000 players took part in the battle.

CCP spokesman Ned Coker told Eurogamer the battle "dwarfs any other online player-versus-player fight in terms of scale and sheer destruction."

"This sort of conflict is what science fiction warned us about."