Jump to content

To RODVIK - Request meeting with Merchants on CommerceTeam concerns


Toysoldier Thor
 Share

You are about to reply to a thread that has been inactive for 4018 days.

Please take a moment to consider if this thread is worth bumping.

Recommended Posts

  • Replies 264
  • Created
  • Last Reply

Top Posters In This Topic

Oh, yes ... actually not disagreeing with you, heheh.

A sardine is after all, just a sardine with no value if it just sits there being a sardine. And this doesn't so much affect us at all (unless you trigger some new red flags for fraud or laundering), or say that L$ are not tokens. It just puts extra regulatory restrictions on LL for the purposes of fraud and friends.

On the other hand, I'd argue without proof that the Lindex is in fact not a user to user transaction at all. It is doctored by LL to maintain a steady exchange value. LL not only issues, but maintains a value, seeds it and also uses L$ for their own purposes (Linden realms and stipends for example). Thus the "user to user" trade bit is not entirely acurate. I suspect it's more like a gamified pool of real money technically engineered to behave as if it were an exchange.

And these regulations aren't brand new to LL, they've had reporting responsibilities for fraud and friends before this.

This one merely targets virtual currency in particular.

But that's the important part to me and to us as consumers.

Because now it's not such a stretch to say that virtual currency should also be regulated by consumer facing law as well.

And it's not such a stretch to say in court (regardless of the TOS) that there is no value in L$ (or virtual currency in general), and thus no liability for LL because you can point to regulation specifically targetting virtual currency.

This is just one step closer to being able to say:

"Hey, I was billed 8 times for an ad and not refunded for 8 ads" or

"Hey, LL is giving away my virtual goods without compensating me ... I never got paid and the customer got the product" or

"Hey I'm being billed in virtual currency for ads that I cannot cancel" or

"Hey I earned 50 million L$ this week and LL won't give me my money"

... and have it stick in court as if it were real money (or fake money with real value).

To me at least, consumer protection for merchants/customers (and we're all customers of LL) is the prize and this is the glue that comes a step closer to proving that regardless of the "virtual", it most definately is recongized as having real world worth, regardless of whether or not LL claims "no, they're just sardines".

This says legally "no, they're not JUST sardines" ... they were sardines issued for real money, as tokens with real value that can be cashed out again with real money.

That LL is not in this loop of transactions just isn't true, whether they claim to be "just" facilitating user to user sardine trades or not. They issue the sardines for real money. They control the value of the sardines. And they allow you to cash out the sardines.

Only viewing this as a step toward virtual currency not being so ... fishy?

Link to comment
Share on other sites


Innula Zenovka wrote:

How do you say the L$ earnings of people in the USA should be taxed?   Should they only be subject to tax if and when they're cashed out, or should people be required to declare all their in-world earnings and be taxed on them if appropriate?

Personally I don't see any reason for it to change. It should be taxed when you receive it as plain old income. Currently PayPal has to report it to the IRS when it exceeds a threshold. Income is income and doesn't need to be further convoluted.

I think that part of the system already works just fine.

 

 

Link to comment
Share on other sites


Dartagan Shepherd wrote:

Oh, yes ... actually not disagreeing with you, heheh.

A sardine is after all, just a sardine with no value if it just sits there being a sardine. And this doesn't so much affect us at all (unless you trigger some new red flags for fraud or laundering), or say that L$ are not tokens. It just puts extra regulatory restrictions on LL for the purposes of fraud and friends.

On the other hand, I'd argue without proof that the Lindex is in fact not a user to user transaction at all. It is doctored by LL to maintain a steady exchange value. LL not only issues, but maintains a value, seeds it and also uses L$ for their own purposes (Linden realms and stipends for example). Thus the "user to user" trade bit is not entirely acurate. I suspect it's more like a gamified pool of real money technically engineered to behave as if it were an exchange.

And these regulations aren't brand new to LL, they've had reporting responsibilities for fraud and friends before this.

This one merely targets virtual currency in particular.

But that's the important part to me and to us as consumers.

Because now it's not such a stretch to say that virtual currency should also be regulated by consumer facing law as well.

And it's not such a stretch to say in court (regardless of the TOS) that there is no value in L$ (or virtual currency in general), and thus no liability for LL because you can point to regulation specifically targetting virtual currency.

This is just one step closer to being able to say:

"Hey, I was billed 8 times for an ad and not refunded for 8 ads" or

"Hey, LL is giving away my virtual goods without compensating me ... I never got paid and the customer got the product" or

"Hey I'm being billed in virtual currency for ads that I cannot cancel" or

"Hey I earned 50 million L$ this week and LL won't give me my money"

... and have it stick in court as if it were real money (or fake money with real value).

To me at least, consumer protection for merchants/customers (and we're all customers of LL) is the prize and this is the glue that comes a step closer to proving that regardless of the "virtual", it most definately is recongized as having real world worth, regardless of whether or not LL claims "no, they're just sardines".

This says legally "no, they're not JUST sardines" ... they were sardines
issued
for real money, as tokens with real value that can be cashed out again with real money.

That LL is not in this loop of transactions just isn't true, whether they claim to be "just" facilitating user to user sardine trades or not. They issue the sardines for real money. They control the value of the sardines. And they allow you to cash out the sardines.

Only viewing this as a step toward virtual currency not being so ... fishy?

The question here would be from a legal point of view who actually "owns" the exchange.

Linden Lab is both an Administrator and possibly a user of the Lindex.

They do operate it as a separate entity from the rest of the Services that they provide.

Whether or not their letters of incorporation as an LLC are publicly available I don't know.  We'd have to look at all those to find out the exact legal structure of Linden Lab.

 

ETA, I agree with you that Linden Dollars have Value.  The question would be how a Court would view that Value and if a User was entitled to compensation for failed or botched transactions.  Until it gets to a Court, we simply don't know.  My personal opinionhas always been a Court would find in favor of the Users.

Link to comment
Share on other sites


Dartagan Shepherd wrote:


Innula Zenovka wrote:

How do you say the L$ earnings of people in the USA should be taxed?   Should they only be subject to tax if and when they're cashed out, or should people be required to declare all their in-world earnings and be taxed on them if appropriate?

Personally I don't see any reason for it to change. It should be taxed when you receive it as plain old income. Currently PayPal has to report it to the IRS when it exceeds a threshold. Income is income and doesn't need to be further convoluted.

I think that part of the system already works just fine.

 

 

Right,  and I am inclined to agree with you.   However, isn't that treating L$ as something other than currency?   I mean, if someone converted them to US$ and left them in their LL US$  account rather than transferring them to PayPal or their bank, they should declare them, I think.   So why does moving them from the L$ to the US$ account make a difference for tax purposes?

Link to comment
Share on other sites


Perrie Juran wrote:



The question here would be from a legal point of view who actually "owns" the exchange.

Linden Lab is both an Administrator and
possibly
a user of the Lindex.

They do operate it as a separate entity from the rest of the Services that they provide.

Whether or not their letters of incorporation as an LLC are publicly available I don't know.  We'd have to look at all those to find out the exact legal structure of Linden Lab.

 

ETA, I agree with you that Linden Dollars have Value.  The question would be how a Court would view that Value and if a User was entitled to compensation for failed or botched transactions.  Until it gets to a Court, we simply don't know.  My personal opinionhas always been a Court would find in favor of the Users.

Ugg, I thought I heard a rumor that the Lindex wasn't actually owned by LL. It can probably be researched. I haven't personally because I'm not interested in taking them to court myself, I'm more interested in the overall picture and consumer protection in general.

Although the wiki says: "LindeX™ is the currency exchange service offert by Linden Lab." and http://secondlife.com/currency/ says nothing to deny that. Also when LL first attempted to acquire the exchange from Gaming Open Network it was LL that negotiated it. It is trademarked by LL, though.

If they don't own it directly then they certainly need to be transparent about it.

Problem with the court scenario is that we've "agreed" to not go to court for anything less than $10,000 USD by way of mandatory 3rd party arbitration. That too needs to go away.

 

Link to comment
Share on other sites


Innula Zenovka wrote:


Dartagan Shepherd wrote:


Innula Zenovka wrote:

How do you say the L$ earnings of people in the USA should be taxed?   Should they only be subject to tax if and when they're cashed out, or should people be required to declare all their in-world earnings and be taxed on them if appropriate?

Personally I don't see any reason for it to change. It should be taxed when you receive it as plain old income. Currently PayPal has to report it to the IRS when it exceeds a threshold. Income is income and doesn't need to be further convoluted.

I think that part of the system already works just fine.

 

 

Right,  and I am inclined to agree with you.   However, isn't that treating L$ as something other than currency?   I mean, if someone converted them to US$ and left them in their LL US$  account rather than transferring them to PayPal or their bank, they should declare them, I think.   So why does moving them from the L$ to the US$ account make a difference for tax purposes?

Ugg again, heheh. If you're operating your merchant business as a sole proprietor or DBA you don't need to report it until it's actually in your hands.

If your business is a corporation, you may have to report it as future income. In your USD LL balance it's still technically not yet in your hands. LL isn't a bank and the money is still in LL's bank waiting to be paid out.

Maybe we should start adding disclaimers about not being legal or financial advice while discussing this ;)

 

 

Link to comment
Share on other sites


Dartagan Shepherd wrote:


Perrie Juran wrote:



The question here would be from a legal point of view who actually "owns" the exchange.

Linden Lab is both an Administrator and
possibly
a user of the Lindex.

They do operate it as a separate entity from the rest of the Services that they provide.

Whether or not their letters of incorporation as an LLC are publicly available I don't know.  We'd have to look at all those to find out the exact legal structure of Linden Lab.

 

ETA, I agree with you that Linden Dollars have Value.  The question would be how a Court would view that Value and if a User was entitled to compensation for failed or botched transactions.  Until it gets to a Court, we simply don't know.  My personal opinionhas always been a Court would find in favor of the Users.

Ugg, I thought I heard a rumor that the Lindex wasn't actually owned by LL. It can probably be researched. I haven't personally because I'm not interested in taking them to court myself, I'm more interested in the overall picture and consumer protection in general.

Although the wiki says: "LindeX™ is the currency exchange service offert by
." and
says nothing to deny that. Also when LL first attempted to acquire the exchange from Gaming Open Network it was LL that negotiated it. It is trademarked by LL, though.

If they don't own it directly then they certainly need to be transparent about it.

Problem with the court scenario is that we've "agreed" to not go to court for anything less than $10,000 USD by way of mandatory 3rd party arbitration. That too needs to go away.

 

Unless the arbitration is Court Ordered, you are not bound to the findings of an arbitrator.  And  even then the arbitrators findings are not final till the Court says so.

Once a principle is established by a Court, an arbitrator has to take into account those principles.

If a Court has said that Linden Dollars have value, a future arbitrator can not say that they don't.

Link to comment
Share on other sites

Awesome, thankfully post-arbitration is a battle I've never had to fight. Also hoping that these battles are not fought specifically with LL to get some change for the good but rather with other companies dabbling in virtual currency which then filters down to LL.

I just think content creators and customers using virtual currency need to be afforded the same protections as everyone else in the real world, without all these liability dodges companies are getting away with.

Entertaining and rewarding as it might be, it's still real business.

Link to comment
Share on other sites


Dartagan Shepherd wrote:

Awesome, thankfully post-arbitration is a battle I've never had to fight. Also hoping that these battles are not fought specifically with LL to get some change for the good but rather with other companies dabbling in virtual currency which then filters down to LL.

I just think content creators and customers using virtual currency need to be afforded the same protections as everyone else in the real world, without all these liability dodges companies are getting away with.

Entertaining and rewarding as it might be, it's still real business.

I think it would take someone with lots of money to burn before we'd ever see this go to Court.

One thing for certain when you look at all this, Linden Lab's attorneys are a lot more on the ball than some people give them credit for.  All you have to do is look and see how in line the TOS is with this 'clarification' from FinCen is to see this, because that is what it really is, a clarification of how they think the actual law applies in these circumstances.

Link to comment
Share on other sites


Dartagan Shepherd wrote:

 

On the other hand, I'd argue without proof that the Lindex is in fact not a user to user transaction at all. It is doctored by LL to maintain a steady exchange value. LL not only issues, but maintains a value, seeds it and also uses L$ for their own purposes (Linden realms and stipends for example). Thus the "user to user" trade bit is not entirely acurate. I suspect it's more like a gamified pool of real money technically engineered to behave as if it were an exchange.

 

 

Thanks Dart. 

Link to comment
Share on other sites


Trinity Yazimoto wrote:


Dartagan Shepherd wrote:

 

On the other hand, I'd argue without proof that the Lindex is in fact not a user to user transaction at all. It is doctored by LL to maintain a steady exchange value. LL not only issues, but maintains a value, seeds it and also uses L$ for their own purposes (Linden realms and stipends for example). Thus the "user to user" trade bit is not entirely acurate. I suspect it's more like a gamified pool of real money technically engineered to behave as if it were an exchange.

 

 

Thanks Dart. 

One thing we don't know is how many Linden Dollars LL "earns" in upload fees and marketplace commissions, etc. and what they do with them.

The weekly stipends LL pays out have to come from some where.  If they simply kept 'creating' Linden Dollars to pay the stipends it would quickly bloat the economy with too many Linden Dollars destroying their value.  The value of the Linden Dollar against the Real Dollar has increased over the past couple of years. 

Link to comment
Share on other sites

As of the last published quarterly report, before they stopped at http://community.secondlife.com/t5/Featured-News/The-Second-Life-Economy-in-Q3-2011/ba-p/1166705

Although the charts containing the data have mysteriously vanished from the page (go figure), I did jot down some numbers at the time...

Quarterly gross Marketplace sales: L$1,183,000,000

5% quarterly commission: L$59,150,000

Link to comment
Share on other sites


Dartagan Shepherd wrote:

As of the last published quarterly report, before they stopped at 

Although the charts containing the data have mysteriously vanished from the page (go figure), I did jot down some numbers at the time...

Quarterly gross Marketplace sales: L$1,183,000,000

5% quarterly commission: L$59,150,000

Someone who is really god at math and economics could probaly extroplate a lot of data.  The big unknown is how many Premium Members there are.

http://www.gridsurvey.com/lindex.php

Link to comment
Share on other sites


Perrie Juran wrote:


Trinity Yazimoto wrote:


Dartagan Shepherd wrote:

 

On the other hand, I'd argue without proof that the Lindex is in fact not a user to user transaction at all. It is doctored by LL to maintain a steady exchange value. LL not only issues, but maintains a value, seeds it and also uses L$ for their own purposes (Linden realms and stipends for example). Thus the "user to user" trade bit is not entirely acurate. I suspect it's more like a gamified pool of real money technically engineered to behave as if it were an exchange.

 

 

Thanks Dart. 

One thing we don't know is how many Linden Dollars LL "earns" in upload fees and marketplace commissions, etc. and what they do with them.

The weekly stipends LL pays out have to come from some where.  If they simply kept 'creating' Linden Dollars to pay the stipends it would quickly bloat the economy with too many Linden Dollars destroying their value.  The value of the Linden Dollar against the Real Dollar has increased over the past couple of years. 

we dont have to forget also, Perrie, that LL takes a commission on every sale of L$ on Lindex. This is why i dont agree for saying they are only intermediaries... a broker is more than a intermediary, his purpose is to do business anyway and he takes money from this.

They are also the ones, and the only ones, who can create l$. i cant believe there are so much l$ cashed out than bought everyday... so, i firmly believe they also are ones of the salers of l$ from Lindex... and if they can maintain a stability about the rate, its bec of the non rl money thing and also, bec there are a lot of dormants accounts with money at every time.. ones become non dormants while other are put to sleep... so this is a part of how they can maintain a stability. an artificial one btw.. bec again, i dont think the ammount of l$ running is stable, but as i said, its virtual money, so i guess its really easier to maintain a stability than for a real one.

Link to comment
Share on other sites

You are about to reply to a thread that has been inactive for 4018 days.

Please take a moment to consider if this thread is worth bumping.

Please sign in to comment

You will be able to leave a comment after signing in



Sign In Now
 Share


×
×
  • Create New...