Shutdown of virtual banks in Second Life; real money lost
Being a virtual world that allows in-game transactions using real life money, Second Life can have some devastating effects on people’s personal lives if they invest too much time – and money – in the game. Such was the case when Linden Labs pulled the plug on several banks in Second Life. Details in the full article.
While most MMORPGs have strict rules against using real money in in-game transactions, such is not the case with virtual worlds like Second Life. While real money does give a more realistic experience, it also has its real dangers.
Such was the case when Linden Labs decided to pull the plug on several banks in the game. A dozen of these digital financial institutions were shut down due to complains that some of these “banks” didn’t operate as they promised.
Some of these banks offered what real life banks would – an interest rate. While some banks did make good on the promise, others merely squandered the money for their personal gain. Some used it for gambling.
Some people were able to get their money out of the banks in time – some weren’t. A report from one virtual bank says that Second Life depositors may have lost as much as US$ 750,000 in real life money. Some of the banks that shut down are returning their depositors’ cash.
The shutdown of these banks were announced two weeks prior. The new rules state that only banks with “proof of an applicable government registration statement or financial institution charter” will be able to operate in the game.
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