Well, this is disturbing.

AppleInsider today picked up on a post by the music industry site Outdustry.com which asserts that hacker in China have figured out a way to produce usable iTunes gift cards, and are now selling them on various Asian Web sites.

On Taobao.com, you can apparently buy a $200 iTunes gift card for the equivalent of $2.60. What you’re really buying, the post notes, is a gift voucher code that the seller provides through Taobao’s IM software; you then type the code into your iTunes account. Payment is through AliPay, a PayPal clone which like Taobao.com is controlled by the giant Alibaba Group, in which Yahoo (YHOO) is a large investor. The post said that according to one of the sellers the voucher codes are generated using “key generators.”

The story noted that the price for the fake cards has dropped to about 18 RMB from 320 RMB over the last six months as more sellers came into the market. Alas, it turns out the fake iTunes gift card business ain’t what it used to be.