Filed under: News and developments by Digado

Just a quick post, as I haven’t been following the in-depth discussion on the big event this weekend as well as I should have: Linden Labs Banning banking in Second Life. This means banks will be closed, mass withdrawals from whatever bank didn’t flee the scene yet, and demonstrations at the banks and by the banks themselves. Its officially the first time Linden Labs steps in between Resident Disputes on this scale - which has brought about a diversity of opinions, summarized in this excellent article over on Rheta’s World.

Personally I think this was long overdue - Banking is Second Life is really as ridiculous as it sounds. You trust your money to an anonymous person, not a company, with promises such as “Double your money within a year”. Of course there where some legit banks out there - mostly those with official companies backing them - but the risks where just to high, and the percentage of scammers/fake banks amongst the few good ones overwhelming. Even the sincire bankers invest their money, investments go sour and it would take a very strong person not to just ‘vanish’ in the anonymity of the internet.

Officially the raeson for this drastic measure is Linden Labs taking a stance for the community - however, some speculate on 2 other reasons - one being LL seeks a monopoly on Linden Dollar trading - but the most reasonable one is: Linden Labs got pressured, or felt pressured from outside sources. Very much like the banning of gambling. This article describes the path banking has taken ever since it started on the ‘Main Grid’ of Second Life in great detail, and how the threat of lawsuits could have resulted in the actual banning.

Update: This article continues at: The Value of Virtual Money

Posted on: January 14, 2008 | Share on: