L$ No value?

[Curtiss Spad]

If, as Linden Labs states in terms of service L$ have no real world value... WHY do they charge a commission of L$ sales in XStreetSL??

[Jessika Rang]

oki first let me explain that i am not a rl lawyer - I am guessing that this line in the TOS exists to absolve them of any responsibility should Lindens suddenly become worthless, untrade-able or should they decide to close the grid leaving many people with huge balances of Lindens they can no longer trade back for dollars. Of course they have rl value on any given day per the lindex and they charge a commission because they can - as any other bank does when you convert currency - but in truth Lindens are not a rl currency so I would not keep a large balance of Lindens.  If you are making money in world then convert them back to dollars monthly.  If you are buying lindens to cover your sl spending then only buy as you need to.

[Lissa Fimicoloud]

The simplified explanation - Linden Lab does not want to come under the rules most countries have for banking institutions. If they give Linden dollars a real value, they come under those rules. So Lindens are not money.

[Alec Windlow]

↑ What Lissa said.

They've gone about as far as they can without having to deal with the hassles of a real currency and the associated currency market (not a place that a relatively small company wants to go).

[Knowl Paine]

Productive people and natural resources, are, will be, and have always been the true sources of wealth. Every nation on the planet uses debt notes. Completely fake money backed by nothing more than our agreed belief in its value. This system does work so long as it is not diluted and only if each party to this agreed collective believes that their effort and labor is being properly compensated. I recognize the L$ as having value and I will continue trading Lindens in exchange for time and energy provided from or by, talented individuals.

Your question has an answer but that answer would be best debated in RL forums. I would recommend subjects like the fractional reserve banking system, hypothecation, captialization, use of three capitis diminutio, tacit acceptance.

Mr. is a fictional character.

[Faubio Alter]

Like coupons used at the store they "are" but they "aren't" worth money. They are tokens, officially they are not currency like US Dollars..

[Vick Forcella]

Lissa.Fimicoloud wrote:

The simplified explanation - Linden Lab does not want to come under the rules most countries have for banking institutions. If they give Linden dollars a real value, they come under those rules. So Lindens are not money.

I wonder what lawyers of different countries would say. A challange of this would be very interesting specially since the TOS is not applicable no matter what it tells.

[Alec Windlow]

Vick.Forcella wrote:

I wonder what lawyers of different countries would say. A challange of this would be very interesting specially since the TOS is not applicable no matter what it tells.

I'm not sure where lawyers would fit into the picture. L$ is no more listed on the worldwide currencies market than is a coupon for a free car wash. What would the lawyers be challenging? TOS is even more irrelevant.

[Vick Forcella]

Alec.Windlow wrote:

Vick.Forcella wrote:

I wonder what lawyers of different countries would say. A challange of this would be very interesting specially since the TOS is not applicable no matter what it tells.

I'm not sure where lawyers would fit into the picture. L$ is no more listed on the worldwide currencies market than is a coupon for a free car wash. What would the lawyers be challenging? TOS is even more irrelevant.

ok, replace lawyers with judges to make it more interesting. Perception is very important since the common user doesn't read or understand the TOS, one reason is easy, it isn't written is the correct language.

Simple questions. How much US$ goes into 260 L$? If I give you one US$, how many L$ will you give me? How much L$ is available in-world at a given time? What is the equivalent value in US$?

With those simple questions it's plausible a judge (in France) will rule L$ *is* a currency. With the amount of L$ available in-world that same judge could rule that LL is in fact a bank.

It becomes specially interesting when someone claims that "If LL goes bankrupt it will influence the economy". What would be the critical amount of L$ to make that last a valid statement? Since it *is* possible. And since it *is* possible the TOS is not applicable anymore and politicians (we all trust) could take over.

Interesting speculations.

[Alec Windlow]

Vick.Forcella wrote:

ok, replace lawyers with judges to make it more interesting. Perception is very important since the common user doesn't read or understand the TOS, one reason is easy, it isn't written is the correct language.

Ok now I'm beginning to see where you're coming from. You're talking about an aggrieved user bringing LL (USA) before a court in a foreign land, right?

With those simple questions it's plausible a judge (in France) will rule L$ *is* a currency. With the amount of L$ available in-world that same judge could rule that LL is in fact a bank.

I guess this is quite possible if somebody has the cash and motivation to take their favourite online hobby to the highest courts in the land.

It becomes specially interesting when someone claims that "If LL goes bankrupt it will influence the economy". What would be the critical amount of L$ to make that last a valid statement? Since it *is* possible. And since it *is* possible the TOS is not applicable anymore and politicians (we all trust) could take over.

I'm not sure which economy you could be referring to. A tiny litigious African nation with an overwhelming number of SL users? In any western country where this sort of action might originate, I'm guessing the SL turnover of cash is far less than that of the major supermarket chains and their 'frequent shopper' type of monetary rewards. As far as influencing national economies goes, I suspect SL is a long way from appearing on anybodys radar.

At the end of the day, it would require somebody kooky enough and sufficiently funded to test their case throughout the major courts of the realm. Since SL users are not generally known for their high degree of disposable income, I'll assume this is not going to happen in our lifetime.

[Curtiss Spad]

I would also add accounting oversight organizations.  I am not a CPA, but I do have my degree in accounting.  In US generally accepted accounting principles (GAAP)  an "asset" is anything which may be converted to cash or cash equivalents.  Such assets, unless found in insignificant quantities only, are required to be included in financial statements for companies requiring audited financial reports.

L$ are very easily converted to USD, whether or not Linden Labs sets the Market. Whether or not LL wants to admit it, L$ already fits the requirements of GAAP, One can argue that they can stop the trading any time they want.  Not really.  If they ceased allowing export of L$ to RL currencies, they would lose the majority of their paying land-owners.  The vast majority of those are fully dependent on converting L$ to USD to pay for their tier fees.

LL can play semantics to try to keep the regulatory and tax wolves at bay, but it will, ultimately, be a losing battle.

Why else would such a big deal have been made about gambling or banking?   If L$ has no value, in-world gaming is not gambling, but playing with worthless virtual chips.

[DR Dahlgren]

Inworld gambling was deemed unlawful specifically because lindens could be converted to USD. The US Government, in ruling against LL, declared Linden currency to have actual value.

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[DR Dahlgren]

Not really true. If you read the fine print on a cupon, they always specify the actual cash value, usually something like 1/10th or 1/100th of a US Cent. Otherwise they are deemed to have to have the same cash value as the face amount.

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