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I know everyone loves to hate the Lindens but I think the TOS change that effects Third Party Exchanges has more to do with illegal currency activity than anyone here comprehends.

This is espceially true for Exchanges that offer options to move LInden Dollars to BitCoin currency.

As in most of the world, regulations are not created for those that use a system fairly but for those willing to exploit it.

While most SL participants simply want an easy way to participate in the SL economy, an element of evil is out there looking at new was to cheat one person or another out of something.

Google "Linden BitCoin Trading" and take a look at the not so obvious problems and why LL has to be proactive.

 

http://www.tandfonline.com/doi/abs/10.1080/1....

 

http://www.hypergridbusiness.com/2013/05/new-registration-requirements.. 

 

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1. Bitcoin is not even close to what you think it is. It's basically the same as cash or gold. It has a bad reputation because people always pay attention only to what's wrong. The news isn't always right. If it was, Second Life would be a sex sim and only a sex sim, Mass Effect would also be that, people would be proven guilty because of hearsay, and all computer experts would be criminals.

2. They get paid when you use LindeX. That's all. They only make it against the ToS because they knew they were missing out when people liked the lower fees on some other service.

3. What if you have no card or Paypal? I know someone (who will remain anonymous for obvious reasons) who plays this who legally cannot own a bank account of any kind. Cash only. Otherwise they revoke his rights under the government program he's in.

4. This won't stop laundering. People will just funnel it through LindeX instead, and LL will be paid for your loss.

5. Don't live in America? Then you can't withdraw L$ anymore. Have fun.

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Kamimatsu wrote:

1. Bitcoin is not even close to what you think it is. It's basically the same as cash or gold. It has a bad reputation because people always pay attention only to what's wrong. The news isn't always right. If it was, Second Life would be a sex sim and only a sex sim, Mass Effect would also be that, people would be proven guilty because of hearsay, and all computer experts would be criminals.

2. They get paid when you use LindeX. That's all. They only make it against the ToS because they knew they were missing out when people liked the lower fees on some other service.

3. What if you have no card or Paypal? I know someone (who will remain anonymous for obvious reasons) who plays this who legally cannot own a bank account of any kind. Cash only. Otherwise they revoke his rights under the government program he's in.

4. This won't stop laundering. People will just funnel it through LindeX instead, and LL will be paid for your loss.

5. Don't live in America? Then you can't withdraw L$ anymore. Have fun.

2. LL is working with some TPE so that they can remain in operation, which lends more credence to the notion of LL complying with US Federal law than the notion that they are being greedy.

5. That is simply not the case. I know people in England, Scotland, Spain, Italy, France, Greece, Mexico, and several Caribbean countries who have NO issues whatsoever with using Lindex and have never used TPEs.

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Kamimatsu wrote:

1. Bitcoin is not even close to what you think it is. It's basically the same as cash or gold. It has a bad reputation because people always pay attention only to what's wrong. The news isn't always right. If it was, Second Life would be a sex sim and only a sex sim, Mass Effect would also be that, people would be proven guilty because of hearsay, and all computer experts would be criminals.

2. They get paid when you use LindeX. That's all. They only make it against the ToS because they knew they were missing out when people liked the lower fees on some other service.

3. What if you have no card or Paypal? I know someone (who will remain anonymous for obvious reasons) who plays this who legally cannot own a bank account of any kind. Cash only. Otherwise they revoke his rights under the government program he's in.

4. This won't stop laundering. People will just funnel it through LindeX instead, and LL will be paid for your loss.

5. Don't live in America? Then you can't withdraw L$ anymore. Have fun.

 

I've seen this question asked a few times in all the flap about TPEs. The answer is quite simple. Your friend should not expect to be able to use Second Life. For the life of me I cannot understand how people who don't even have bank accounts, much less credit cards, seem to expect that the rest of the world should stop doing business the normal way and set up some sort of special program JUST FOR THEM.

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Dillon Levenque wrote:


Kamimatsu wrote:

1. Bitcoin is not even close to what you think it is. It's basically the same as cash or gold. It has a bad reputation because people always pay attention only to what's wrong. The news isn't always right. If it was, Second Life would be a sex sim and only a sex sim, Mass Effect would also be that, people would be proven guilty because of hearsay, and all computer experts would be criminals.

2. They get paid when you use LindeX. That's all. They only make it against the ToS because they knew they were missing out when people liked the lower fees on some other service.

3. What if you have no card or Paypal? I know someone (who will remain anonymous for obvious reasons) who plays this who legally cannot own a bank account of any kind. Cash only. Otherwise they revoke his rights under the government program he's in.

4. This won't stop laundering. People will just funnel it through LindeX instead, and LL will be paid for your loss.

5. Don't live in America? Then you can't withdraw L$ anymore. Have fun.


I've seen this question asked a few times in all the flap about TPEs. The answer is quite simple. Your friend should not expect to be able to use Second Life. For the life of me I cannot understand how people who don't even have bank accounts, much less credit cards, seem to expect that the rest of the world should stop doing business the normal way and set up some sort of special program JUST FOR THEM.

Bank accounts are necessary, but Lindex requires either CC or a Paypal verified with CC. So it's credit cards and Paypal that are the problem. America isn't the world. Actually, in the rest of the world, neither CCs, nor Paypal are a "normal way of doing bussiness" and a large portion of people don't have them. And that world is changing fast. With the advent of virtual currencies and Bitcoin, PayPal is becoming obsolete, especially for young people in Europe.

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Dillon Levenque wrote:


Kamimatsu wrote:

1. Bitcoin is not even close to what you think it is. It's basically the same as cash or gold. It has a bad reputation because people always pay attention only to what's wrong. The news isn't always right. If it was, Second Life would be a sex sim and only a sex sim, Mass Effect would also be that, people would be proven guilty because of hearsay, and all computer experts would be criminals.

2. They get paid when you use LindeX. That's all. They only make it against the ToS because they knew they were missing out when people liked the lower fees on some other service.

3. What if you have no card or Paypal? I know someone (who will remain anonymous for obvious reasons) who plays this who legally cannot own a bank account of any kind. Cash only. Otherwise they revoke his rights under the government program he's in.

4. This won't stop laundering. People will just funnel it through LindeX instead, and LL will be paid for your loss.

5. Don't live in America? Then you can't withdraw L$ anymore. Have fun.

 

I've seen this question asked a few times in all the flap about TPEs. The answer is quite simple. Your friend should not expect to be able to use Second Life. For the life of me I cannot understand how people who don't even have bank accounts, much less credit cards, seem to expect that the rest of the world should stop doing business the normal way and set up some sort of special program JUST FOR THEM.

On top of this, people can still use SL without having to spend one single penny of RL money.

I don't play WOW so someone who does can correct or add to this.  A few weeks ago when some people were complaining that SL cost too much I was trying to look up exactly how much it costs to play WOW.  They seem to  keep that info buried. 

Today I tried to find what payment methods they accept and found this:

 

"So my mom is hesitant to put her credit card online and I was wondering what other options I can walk to rite aid and I can put money on paypal or I think I may be able to buy a visa gift card. I really can't get a WoW game time card because they dont sell them near me and my mom won't take me. I can put money on paypal via moneypak but I checked the checkout just to see what it was like and it said I had to attach a credit card and I dont have one. I dont know much about these payment methods and I really want to play WoW so if you could help that would be awesome. Thanks everyone!"  (my bolding)

http://us.battle.net/wow/en/forum/topic/2795123067

 

Tracking this a little further I found this in WOW's FAQ:

"You’ll be redirected to PayPal’s login page. You may log in to an existing PayPal account or create a new PayPal account. You must have a credit card associated with your PayPal account in order to make payments or receive funds."    (my bolding again)

 

https://us.battle.net/support/en/article/syncing-paypal-with-battlenet

 

 

eta:shpelling

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kevin350 wrote:

I know everyone loves to hate the Lindens but I think the TOS change that effects Third Party Exchanges has more to do with illegal currency activity than anyone here comprehends.

This is espceially true for Exchanges that offer options to move LInden Dollars to BitCoin currency.

As in most of the world, regulations are not created for those that use a system fairly but for those willing to exploit it.

While most SL participants simply want an easy way to participate in the SL economy, an element of evil is out there looking at new was to cheat one person or another out of something.

Google "Linden BitCoin Trading" and take a look at the not so obvious problems and why LL has to be proactive.

 

...

 

 

I never understood the fraud argument. The most I've been defrauded on the Internet is 30 bucks on Ebay. I say let that crook keep those 30 dollars and let us keep the free market. You should never keep more money on PayPal, Second Life, Bitcoin or whatever more than you would be prepared to lose. Internet fraud isn't that big of a deal, it's mostly scaremongering to enact more of such regulations. And I do not understand why we should all be wasting our time and going through paperwork because some dude somewhere got swindled out of 50 bucks.

As for Bitcoin. Yes, it's the fastest and most anonymous way of transfering money right now which probably makes it very attractive to frauds. However, it's not where the most of the fraud happens. PayPal remains the most frequent target for frauds and hackers, and despite it's size, it's the payment processor that is significantly easier to hack into than most virtual currency processors. And if Lindex wouldn't be using PayPal and CCs and accepting bank deposits and virtual currency only, there would be no credit card fraud on Second Life at all, which seems to be the issue Linden Lab is mostly concerned about. So in my eyes it's really PayPal's fault, not Bitcoin's.

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Rommanno wrote:

 

Bank accounts are necessary, but Lindex requires either CC or a Paypal verified with CC. So it's credit cards and Paypal that are the problem. America isn't the world. Actually, in the rest of the world, neither CCs, nor Paypal are a "normal way of doing bussiness" and a large portion of people don't have them. And that world is changing fast. With the advent of virtual currencies and Bitcoin, PayPal is becoming obsolete, especially for young people in Europe.

Oh really? The whole "rest of the world"?

And "becoming obsolete"? The number of global credit card transactions per second surpasses the number of bitcoin transactions for goods and services since the beginning of time.

Let's get a grip.

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Kamimatsu wrote:

1. Bitcoin is not even close to what you think it is. It's basically the same as cash or gold. It has a bad reputation because people always pay attention only to what's wrong. The news isn't always right. If it was, Second Life would be a sex sim and only a sex sim, Mass Effect would also be that, people would be proven guilty because of hearsay, and all computer experts would be criminals.

Bitcoin is a virtual currency and not cash or gold.  I've read article after article that discusses bitcoins money laundering problems.  While I agree that not everyone that uses it is a criminal, apparently they have a real problem.

2. They get paid when you use LindeX. That's all. They only make it against the ToS because they knew they were missing out when people liked the lower fees on some other service.

Untrue.  See
and follow the links.  This is an independent virtual currency legal analyst giving the information who has no connection to LL or any reason to lie.

Virwox has reported on their website today that they are now in negotiation with LL, who approached them, to resume business once they are in compliance.  Doesn't sound like the actions of a company just trying to monopolize an exchange.

3. What if you have no card or Paypal? I know someone (who will remain anonymous for obvious reasons) who plays this who legally cannot own a bank account of any kind. Cash only. Otherwise they revoke his rights under the government program he's in.

Sounds like he has a personal problem with the law due to some illegal activity he was engaged in and that he is on parole.  That is no one's fault but his own and gets no sympathy from me.  Next...

4. This won't stop laundering. People will just funnel it through LindeX instead, and LL will be paid for your loss.

It may not stop it completely but will stop some and make it easier to trace.  Nothing will stop all criminal activity.  So should we just dispense with all laws?

5. Don't live in America? Then you can't withdraw L$ anymore. Have fun.

Absolutely untrue.  Paypal is available in all countries except a few rogue states.  I personally know many Euro's who have an account and use it on the exchange.  Wire transfers may also be done if you are unable to get a verified Paypal Account.

If you have been personally effected, I understand your anger.  However, you really should check your facts before posting 'less than truthful' information like this.  

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Rommanno wrote:

 Bank accounts are necessary, but Lindex requires either CC or a Paypal verified with CC. So it's credit cards and Paypal that are the problem. America isn't the world. Actually, in the rest of the world, neither CCs, nor Paypal are a "normal way of doing bussiness" and a large portion of people don't have them. And that world is changing fast. With the advent of virtual currencies and Bitcoin, PayPal is becoming obsolete, especially for young people in Europe.

 

I am quite well aware that America (I assume you meant the USA which is only a portion of 'America') is not the world. Neither is Europe, although Europe does lead the world in Electronics Fund Transfer technology—because they use it so much. We in the US lag behind developments there.

My point was and is that getting by on cash alone without a bank account is certainly feasible, but a great many online transactions will be impossible. Anyone who doesn't expect that is ignoring reality.

 

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That still doesn't change the fact, that creditcards are not as common in western europe as some think they are.
I don't have one either. It is time, american companies get used to the fact, that the USA and its usual way of doing business is not the standard in the rest of the world.

Oh, and PayPal is NOT an alternative, PayPal keeps freezing accounts randomly, as they are doing for years.
PayPal was again a hot topic in today's BBC Watchdog programme. The first victim was a provider for mobile toilets,
when the event season started and thus the money flow started as well, PayPal froze the account with 34000 pound in it(about US$40000,--).
Second one had used his PayPal-account only once, to sell a pair of old shoes. Value: 99pence. Result: Account frozen.
It was the only transaction ever on that account.
Third one was a supplier of medical equipment, PayPal froze that account with no reason given. PayPal insisted on getting
a long laundry list of documents, which covered practically all merchandise coming in and going out. Note: A good merchant
never discloses his sources and conditions to anyone. But exactly that was, what PayPal wanted to know.
All three victims were given the runaround, until the TV-guys started asking questions.
There were cases in Germany, where pressing charges at the police against PayPal got things going, others had success by contacting the Luxembourg banking authorities.

 

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That was an interesting comment since it indicates kind of the opposite of what I'd been led to believe (that CC use in Europe was very common). I just did a little googling. It took a bit of effort because if I google ''credit card use by country" I don't get much of anything, and most of the results want to tell me about what countries will accept my US credit cards—damn google knows where I LIVE!—but I did get some relevant data.

The advanced technology I alluded to in my earlier post here had to do with Chip & Pin. The US is just now adopting this; it has been the European standard for quite some time. Here is a link to a fairly non-technical article on the subject.

A quote from the article leads me to believe that CC use in Europe is quite high: " According to a report from digital consulting firm Capgemini Consulting, by 2011, 75.9 percent of terminals and 42.4 percent of credit cards globally were EMV compliant." (EMV compliant = chip & pin). Virtually NONE of that 42.4 percent would be US cards, especially in 2011. There are very few even now, although the change is coming.

I don't know what percentage of the world's credit card transactions are in the US, but in 2011 it's pretty apparent at least 40% were NOT. In fact in 2011 only a few countries outside of Europe had forced EMV compliance (New Zealand, for instance). Just saw that in a wikipedia article.

It appears to me that while CC use in Europe may not be nearly as common as it is in the US (where it is almost universal) it certainly can't be called UNcommon.

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Dillon Levenque wrote:

 

It appears to me that while CC use in Europe may not be nearly as common as it is in the US (where it is almost universal) it certainly can't be called UNcommon.

While it definatly is posible for someone with a good credit rating to get a CC more and more people that have one are giving it up because of 2 reasons.

first even unused they cost a lot of money because nobody wants a CC without some form of insurance against fraud and seccond they hurt your credit rating, the limit on the creditcard counts as a loan even when not used meaning that if you need a loan for something the CC limit is deducted from the loan limit.

Normaly it would not be a big problem but with the poor rl economy it is becoming a big one, especialy as the banks are limiting loans more and more when people actualy need them.

(a saying here is a bank gives you an umbrella when the sun shines and takes it away when it rains)

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Interesting. I haven't looked very much (as in almost not at all) about how credit cards are managed outside of the US but I did know the rules regarding them varied from how they work here.

You don't need a good credit rating to get a credit card in the US. You don't need any credit rating. People have gotten credit cards for their pets, for fictional characters, for all kinds of silly things. Of course that has probably changed just a bit since the recession put the skids under everything, but even now it's pretty easy to get one.

Fraud protection is included, and it is actually pretty good protection. There is in most cases no extra charge. Most cards don't have annual fees, either. I don't know this for a fact, but based on my last conversation with a banker the line-of-credit thing (how much you already have influencing how much you can borrow) is not anywhere near as important as  how much revolving debt you actually have.

How can this be possible, you ask? Simple. The CC companies get all that back and much much more with the massive interest they charge on unpaid debt and the humungous fees they tack on for missed payments. The unfortunate fact is that many (I am quite sure way more than 75%) of the people who have and use credit cards in this country have no business being within arm's reach of one. They rack up huge debts, miss payments, make only the minimum payment when they do pay. As a result the CC company rakes in a ton of extra money.

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I live in the UK.  I have not used a credit card in getting on for 20 years.   I use PayPal, connected to my bank account via my debit card, without difficulty.   For a while you couldn't used PayPal at all for SL as a new payment method  if you were outside the US (this is three or four years ago, I think).  My account was grandfathered in but I just gave SL my visa debit card number to put my alt's payment info on file (back when we had age verification).

My only complaint about cashing out from the Lindex is takes so damn long.

However, there is encouraging news on the Virwox site:


Good News: Linden Lab has approached us with a potential solution that would allow us to serve our customers within the bounds of the updated Second Life Terms of Service. We are in discussions with them and look forward to being able to share more information very soon;

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Rommanno wrote:

 Bank accounts are necessary, but Lindex requires either CC or a Paypal verified with CC. So it's credit cards and Paypal that are the problem. America isn't the world. Actually, in the rest of the world, neither CCs, nor Paypal are a "normal way of doing bussiness" and a large portion of people don't have them. And that world is changing fast. With the advent of virtual currencies and Bitcoin, PayPal is becoming obsolete, especially for young people in Europe.

Europe isn't the world either.  Instead of trying to tell another country what laws you find acceptable or not, why not ask your own country why in this day and age you can't get a debit card for electronic access to your own money?  Restricting access to your own money seems more ominous to me than some reasonable regulations to prevent money laundering and fraud.

I don't have a credit card as I believe in only buying what you have the money for.  I use a debit card that is connected to a checking account I opened specifically to use for holding money for paying or receiving money in SL and other internet sites.  That way if it is hacked they don't have access to my main accounts, just this one which I tx money to or from as needed to maintain a zero or minimum balance.    I've used this card both directly on the Lindex and also to verify my PayPal account.  Since I set this up in 1995 I've had zero problems with  it on any internet site including SL.

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Jadeclaw Denfu wrote:

That still doesn't change the fact, that creditcards are not as common in western europe as some think they are.

I don't have one either. It is time, american companies get used to the fact, that the USA and its usual way of doing business is not the standard in the rest of the world.

It's almost certainly true that credit cards are used much more commonly in North America than in Europe and elsewhere, and the practices are evidently quite different. For example, the market for credit card fraud insurance here is practically non-existent because the credit card issuers assume all risk of fraudulent charges. (There are card theft protection services that will cancel all registered cards at once on command, but I don't know how many cardholders actually pay for those.) And here, having a record of paying off card charges is one way of establishing a credit rating; it's not easy to get a mortgage, for example, without having some such history visible to Fair Isaac and its ilk. (That's not to say any of this is smart; the US has absurdly lax usury laws, and its lending practices triggered a global recession.)

I didn't mean to downplay the difficulties that some will face with this change -- and the relief that may be in store for them in light of Innula's report that TPEs are being shown a way to resume operations with changes.

Nonetheless, in deciding how to respond to the FinCEN finding, the Lab would have to weigh what new lines of business it wants to enter, and it's just not realistic to expect it to branch into financial services tailored for each market in which it operates. It needs partners to do that, such as TPEs and PayPal. I suspect we'd agree that those partners will do a better job of it; whatever horror stories may be told of PayPal, they'd pale in comparison to what would go wrong if the Lab tried to do it all themselves.

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Some general comments, not specifically to Qie...

1. Europe comprises many countries, some richer and some not so well off, so the idea of credit card use in Europe doesn't make any sense.

2. Judging by my supermarket checkout experience here in the UK, I doubt that credit cards are any less used here than in the U.S. In fact, it's quite rare to see someone pay with cash. I recently started paying everything I can with cash, but that's because I saw my annual credit card statement, and the interest I paid in the year for not clearing the account each month. Not because I couldn't, but because I'm very bad at doing that sort of thing. I've become something of a rarity at supermarket checkouts :)

3. As Qie said, the use of a credit card actually builds a person's credit rating. That's the only reason I started to use one - after a relatively bleak period in my life when my credit rating tanked.

4. Also, as Qie said, insurance against losses through stolen cards is automatic here, so having a credit card doesn't cost anything.

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It's a bit different here in Germany, offline(e.g. supermarket checkout) it is either cash or bank issued debit card,
called EC-Card(formerly known as Eurocheque card), it is either chip & pin or magnet strip & pin.
Online, payments are made using bank transfer, direct debit, cash cards like Paysafecard or a system called
'Sofortueberweisung', you enter a few details about your bank account during checkout and the Sofortueberweisung'-Service
does the rest. Easy, quick and much safer than PayPal or a creditcard.

This as an example, how diverse Europe really is. According to some posts, Greece is a Paysafecard-Economy.
In countries like Greece and Cyprus, the trust in the banking sector took quite a nosedive, so I expect,
that alternative forms to pay online need to be found.
And I expect an internationally operating online business like Linden Lab to cater for this diverse clientele.
The minimum I expect here is bank transfer (SEPA), being fully compatible to ALL prepaid creditcards and accepting
the major cash cards. The TPEs were that flexible, and if these relatively small operations can do it, why not a big company like LL?
User retention is a sore point dogging SL for years, making payments easy, quick and comfortable is
one major part in improving user retention. Another big part of it would be a different communication culture at the Lab,
this TPE-clusterf... is a prime example of how NOT to do it.

And Phil, another thing, that doesn't exist here in Germany is Payday loans.
Agreed overdraft on bank accounts is the standard here, so these fraudsters are unnecessary over here. :matte-motes-grin:

 

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Which confirms that the comments in this thread, about credit card usage in Europe, are meaningless :)

The first time I ever heard of 'payday loans' was when I got a U.S. client (for seo) who was in that business. At that time, such loans didn't seem to exist here in the UK, but now they are all over the TV ads, so I assume that it has spread from the U.S. to here. Imo, they are a nasty part of life.

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