Saturday, April 13, 2013

Bitcoin in Second Life



When it’s a question of money, everybody is of the same religion.

Voltaire

 
          I’m blogging about a topic in Second Life (SL) that I haven’t written about in a while and it’s money.  (Yep, figured that would get everyone’s attention.  After sex that’s always a good one!)  In particular, I’m writing about bitcoin.  The virtual currency that’s been in the press a lot lately. 
          Bitcoin is a recent Internet phenomena.  (Alright, maybe 2008 ain’t “recent” in Internet terms but you get the idea.)  Supposedly, it was engineered by a developer, Satoshi Nakamoto, which is supposedly a fictitious name.  The idea being to create a virtual currency independent of any governmental or regulatory authority.  Comes in handy if you’re a drug dealer, terrorist, or American Libertarian.  OK, that may be judgmental, there’re probably good reasons for this like you live in a dictatorship and need discrete funds for your revolution or afraid a government might confiscate your monies. 
          The recent financial crisis in Cyprus  seems to have revived interest in bitcoin as a hedge against confiscation of monies by governments or devaluation.  This is turn seems to generated a flurry of media articles about bitcoin.
          Naturally, when something happens in Real Life (RL), there’s a follow on effect in SL.  Wagner Au recently posted an interesting story on his blog in which he talked about the implications arising for virtual currencies like Linden Dollars because of increasing government scrutiny of currencies like bitcoin. 
          All this got me thinking about if I could find bitcoin in SL.  Seemed reasonable to me.  After all, SL is a virtual world.  Stands to reason that other virtual currencies could be found inworld.  Why another currency is needed in SL is another question but who knows?  (Would Linden Lab ever confiscate Linden Dollar balances?)  Seems the FBI has long considered SL to be a hotbed of money laundering. They also think it’s a great place for RL gangs to hang out.  Don’t believe me?  Check out their website. 
          So, using SL’s handy dandy search function, I go looking for bitcoin inworld.  Turns out there’s a fair bit (no pun intended) of bitcoin activity going on.  There’s a user group dedicated to the currency as well as a couple of currency exchanges.  There are a few references to bitcoin mining whatever that is.  (Don’t worry, I’ll try and find out.)  I find a link to a website where it’s possible to trade in Linden Dollars, bitcoin, Euro’s, and US Dollars in addition to a variety of other SL financial transactions.  (I need to spend more time looking over the financial services industry inworld.) 
          I drop in to visit The Rock Trading Currency Exchange.  It reminds me of any one of a number of faceless bank branches scattered across America’s suburbs.  All polished metal and marble with lots of glass.  Currency transactions are available.  A bank guard, a bot, stands stiffly in a corner.  (Must be something valuable around whenever there’s a guard.)
          Data boards flash prices for the different currencies.  I’m not sure what folks would do with bitcoin inworld.  I’ve only ever seen prices denominated in Linden Dollars.  Linden balances can be held with Linden Lab in SL.  I’m assuming that people keep their balances with the exchange.  An interesting concept.  Something else for me to check out in the future. 
          So, I find bitcoin in SL.  I’m not sure what people do with it or even what its future is.  Given the inferences on Wagner Au’s blog and those on Alex Kadochnikov‘s blog there may be some changes afoot for Linden Dollars and bitcoin.  Maybe depending on how the global financial crisis is resolved will determine their fates. 
          I’ve included a few pictures from my visits to the inworld financial institutions, The Rock Trading Company and GMG Financial Center, should anyone be curious about these locations. 
 As always, I’m grateful to all for their kindness and time in stopping to talk with a stranger who was passing through their lives.
I welcome feedback from readers, please either comment on my blog or e-mail me at webspelunker@gmail.com . 

     If you would like to read about my other adventures in Second Life
please click here.

Photo No. 1  The Rock Trading Currency Exchange



Photo No. 4  The Rock Trading – ATM

Photo No. 5  The Rock Trading Lobby




12 comments:

Tattoo Lane said...

I've often wondered what bitcoin was - now I have more of an idea - thank you!

kimba said...

Ha! Did I bring up this topic or is that a coincidence that you were going to write about it?

Mining has to do with transactions and keeping the ledger, which is done in a similar way to but not anything like how something like SETI or BitTorrent work where the ledging is done on a lot of different computers so the information is all over the world and not just in one place.

I'm looking for a currency to use that is not based on any current real life currency. That's what I can't tell about bitcoin ... do I need USD to purchase bitcoins, or does everyone start out with a pack of 100? That's what I'm not getting.

Janey Bracken said...

How strange web, it seems we both investigated Bitcoin in SL at the same time. I too visited an exchange in SL and made enquiries about swapping Lindens for Bitcoin. I had a job getting my head around Bitcoin and think I will give it a miss for a while, finding it difficult to put real pounds into it without using a bank to transfer money, which would cost around £22 for each transaction; Bitcoin prices fluctuated too much and also I didn’t like the security aspect of the whole thing, but then I’m not a software genius. But I pose a question! This is just a thought! What if this has all been planned by the people in charge who want a global bank as economies collapse? It’s rumoured they want a world bank with just digital money for everyone worldwide and the ability to control what we have, or have not. So they make out a person (a fictional member of the public?) has invented Bitcoin and then they do the Cyprus thing by raiding the bank accounts, making people desperate to find another source for their money. The Bitcoin system sits there waiting whilst just a couple of days ago the gold and silver market did a nosedive, thus making people insecure about buying metals, at the same time the banks have advised people to sell what gold they have as the precious metals market may fall again. Get my drift? So if people put all their savings into this digital money and give up on Fiat money and gold and silver, then they are trapped if this turns out to be a set up. Just a thought. Although I like the idea of BitCoin in itself, I think it’s too soon to tell if this is indeed, very dodgy!

webspelunker said...

Tattoo,

My pleasure! TYVM for reading!

TC

web

webspelunker said...

Kimba,

Yes, when I found that even the "Cranky Buddhist" was writing about bitcoin on her blog, I figured I'd better do something quick!

Bitcoins can be purchased with USD but, like any financial transaction, be careful who you deal with. Would you be able to retrieve your monies in the future? What fees are involved?

I'll try to address in future stories.

Thanks for reading and commenting!

TC

web

webspelunker said...

Janey,

Great minds think alike! (Yours is at least, I'm still playing catch-up!)

You raise a good point. (In fact, you've got the makings of a good thriller, just add some violence, sex, and a protaganist who can be played by Tom Cruise.)

What are bitcoins? I'm not comfortable myself yet. The idea is a good one but more thought is needed here. Stretching my too few university courses in economics makes me think we're replacing a commodity standard such as gold with a digital one. We have a long way to go here before anything happens.

Thanks for adding to the discussion!

TC

web

kimba said...

Janey: I've also wondered about this. We know the current real world economies are going to collapse (just not exactly when) and I think there's a 50/50 chance that this is a setup. If it is, it is very elaborate as it's also been written up in US media that our government "doesn't like it one bit."

I never liked Lindens because one needs "real" money (USD in my case) to buy them.

As far as the FBI thinking SL is a place for gangsters - it seems they are getting Second Life confused with Snow Crash.

Myrylyn Shin said...

Interestingly enough, I'm a store owner in Second Life and I just took some of my profits to invest in a bitcoin mining rig. Buying bitcoin is fine for people with lots of money, but if you have very little and a half-decent video card, you can mine it for yourself. In my first try, I was able to mine at a rate of 1GH/s. This gave me the confidence to purchase a full-time mining ASIC from Butterfly Labs. I'll be mining at a rate of 60GH/s by the end of July if everything goes right. Not bad for a fashion school drop-out, hm? :)

Janey Bracken said...

Hi web and kimba, Yes web, it would make a good thriller! not sure about Tom Cruise though! I'd like to think it's too incredible to be true, but you never know! Kimba I can't see any other way than the economies in the West crashing, the whole Ponzi scheme has spiralled out of control, but everyone knows how it works now. So I really do hope Bitcoin is genuine. I could see it being handy for just transaction purposes, but not for savings, so we need another sort of coin for that, something tangible that we can touch and feel, but without the fractional banking ability. Dream on! Still Iceland got out of trouble by cancelling their debts and sacking the bankers, so there is hope! Good for you Myrylyn, it's nice to hear someone using Bitcoin successfully and the more stories we hear like this, the more people will trust it eventually, you are part of the true pioneers for this type of digital currency, so I will watch how it all goes with interest. :))

webspelunker said...

Myrlyn,

Thank you for commenting and I admire your spirit of entreperneurship!

Would you be open to an interview on bitcoin mining in SL?

TC

web

Myrylyn Shin said...

I would be happy to be interviewed regarding my understanding of bitcoin mining. Please don't expect much, though-- as I said, I'm a fashion-school drop out still trying to wrap my head around being independent and out on my own! I am on most days, from about 5pm-6pm and then from 10pm on until... whenever I fall asleep!

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