[Opensim-users] Virtual World Currency gets more complicated
Karen Palen
karen_palen at yahoo.com
Thu Jan 21 00:48:04 UTC 2010
Certainly the experiences of Second Life and World Of Warcraft show that most authorities (US, European, and Asian) treat "in world" money as real money. The only condition seems to be that you can somehow convert both to and from a real world currency to the virtual currency.
This is certainly not a "show stopper" which would prevent an in world currency, nor do intend to imply that it is.
However since there has not been any reasonable form of in world currency for the OpenSim based grids so far, all of these grids and sims have been operated without any need to consider these issues.
In various private email exchanges with different sim owners, I have been alarmed at the rush to simply "include a currency scheme" into their worlds without considering the implications of such a move.
Both Second Life and World of Warcraft had amply illustrated the problems involved and there is no need to repeat their mistakes!
I agree that "money laundering" as we normally conceive it is unlikely, but you only have to look at the history of PGP encryption for an example of what can happen:
"Shortly after its release, PGP encryption found its way outside the United States, and in February 1993 Zimmermann became the formal target of a criminal investigation by the US Government for "munitions export without a license"
http://en.wikipedia.org/wiki/Pretty_Good_Privacy
There are a great many such examples which are not as well known.
Most real world laws and taxes are based on the location of the transaction, this loctaion is very hard to define for a virtual world transaction.
How does one figure out depreciation on virtual goods or in world land?
I am sure anyone reading this can supply more such questions.
Karen
--- On Wed, 1/20/10, lamont cranston <l.cranston at gmail.com> wrote:
> From: lamont cranston <l.cranston at gmail.com>
> Subject: Re: [Opensim-users] Virtual World Currency gets more complicated
> To: opensim-users at lists.berlios.de
> Date: Wednesday, January 20, 2010, 1:30 PM
> For users, if the money is real, and if US
> law sees it that way, it becomes a just another normal
> business transaction to exchange virtual goods. And that
> includes sales taxes, and IRS income reporting.
>
> It really isn't that far fetched -
>
>
> The reason Bob paid 500 USD for a golf club is because of
> the increased enjoyment he gets from having it; it impresses
> other, knowledgeable players, and increases his enjoyment of
> the game.
>
> The reason Alice paid 1200 L$/Meta/WoWgold for a virtual
> item is because of the increased enjoyment she gets from
> having it; it
> impresses other, knowledgeable players, and increases her
> enjoyment of
> the game.
>
> Similar transactions, with similar reasons for making the
> transactions. Why, in the mind of a tax lawyer, should they
> be treated differently? Bob paid his state's sales tax,
> why shouldn't Mary? From a tax man's view, the
> virtual is an improvement on the physical, because every
> exchange must be documented, by a central authority.
>
>
> For the person/company running the world, they are
> literally playing "bank" since they are holding
> real assets for users - the whole idea of "fiduciary
> obligations", as others mentioned, kicks in. Since a
> server crash could deny someone the peaceable use of their
> property, that could be a potential hassle as well...
>
>
> "money laundering" is an interesting angle,
> although the virtual realm is not the most appealing way to
> actually bury a transaction (imagine trying to move
> 50,000USD into and out of a sim, in a reasonable amount of
> time, given that most transactions are way below 1USD. You
> can see that buying and selling a car would be more
> attractive)
>
> But common sense is not the usual attribute of a tax
> agency.
>
>
>
>
>
>
> On Wed, Jan 20, 2010 at 3:58 AM,
> Karen Palen <karen_palen at yahoo.com>
> wrote:
>
> My favourite quote from him is that
> the US Tax code is a high stakes game played with a 500,000
> page rulebook! He delights in finding sets of rules in one
> place that contradict others and using the result to save
> his clients tax money.
>
>
>
>
> Many of his clients pay ZERO income tax BTW.
>
>
>
> Karen
>
>
>
> --- On Tue, 1/19/10, Jane Foxclaw <janefoxclaw at gmail.com>
> wrote:
>
>
>
> > From: Jane Foxclaw <janefoxclaw at gmail.com>
>
> > Subject: Re: [Opensim-users] Virtual World Currency
> gets more complicated
>
> > To: opensim-users at lists.berlios.de
>
> > Date: Tuesday, January 19, 2010, 8:36 PM
>
> > He and I would get
> along then. I'm the
>
> > same way. I speak my mind, even though some say I have
> a
>
> > HUGE ego, which i do for a reason.. but I do admit
> it..
>
> > lol
>
> > I would surely run my Grid as a Non-profit if it
>
> > came down to it. It really depends on the situation.
>
> >
>
> > John
>
> >
>
> > On Tue, Jan 19, 2010 at 9:27 PM,
>
> > Karen Palen <karen_palen at yahoo.com>
>
> > wrote:
>
> >
>
> > Actually that (and the other things I outlined in my
>
> > earlier email) is one reason I NEVER intend to run my
> grid
>
> > "for profit".
>
> >
>
> >
>
> >
>
> > If you ever plan to run a grid "for profit",
> do
>
> > look at the rest of John Hyre's website though. He
> has a
>
> > lot for good material and IMHO the right attitude
> about
>
> > taxes. His tax law business is oriented to real world
> real
>
> > estate, but many of the concepts carry over to the
>
> > "virtual real estate" which is the only
> actual
>
> > "product" sold by Second Life and most
> OpenSim
>
> > grids that I have seen.
>
> >
>
> >
>
> >
>
> >
>
> > BTW he would call you a wimp for "knuckling
>
> > under" and not beating the government (IRS in
> this
>
> > case) at their own game. He is nothing if not
> outspoken :-)
>
> >
>
> >
>
> >
>
> > Karen
>
> >
>
> > --- On Tue, 1/19/10, Jane Foxclaw <janefoxclaw at gmail.com>
>
> > wrote:
>
> >
>
> >
>
> >
>
> > > From: Jane Foxclaw <janefoxclaw at gmail.com>
>
> >
>
> > > Subject: Re: [Opensim-users] Virtual
>
> > World Currency gets more complicated
>
> >
>
> > > To: opensim-users at lists.berlios.de
>
> >
>
> > > Date: Tuesday, January 19, 2010, 6:18 PM
>
> >
>
> > > If it happens it
>
> > happens.. I'll just
>
> >
>
> > > stop messing with Virtual Sims at that point. No
> point
>
> > in
>
> >
>
> > > giving money away to government. Make them earn
> it
>
> > like they
>
> >
>
> > > never have in the past.
>
> >
>
> > >
>
> >
>
> > > On Tue, Jan 19, 2010 at 7:09 PM,
>
> >
>
> > > lamont cranston <l.cranston at gmail.com>
>
> >
>
> > > wrote:
>
> >
>
> > >
>
> >
>
> > > if the
>
> >
>
> > > currency is real, then you need to be cautious.
>
> >
>
> > > The tax man is watching.
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > On Tue, Jan 19, 2010 at 5:32 PM,
>
> >
>
> > > Jane Foxclaw <janefoxclaw at gmail.com>
>
> >
>
> > > wrote:
>
> >
>
> > >
>
> >
>
> > > Ok so your point here is that we
>
> >
>
> > > should NOT go live with currency ? because I am
> lost
>
> > as to
>
> >
>
> > > what the point it is your trying to make here.
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > Sonya
>
> >
>
> > >
>
> >
>
> > > On Tue, Jan 19, 2010 at 4:14 PM,
>
> >
>
> > > Karen Palen <karen_palen at yahoo.com>
>
> >
>
> > > wrote:
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > This is from today's slashdot.org
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > I know many OpenSim users are planning to set up
> soem
>
> > form
>
> >
>
> > > of currency exchange on their grids. THis si one
> of
>
> > the
>
> >
>
> > > aspects that needs to be considered before
>
> > "going
>
> >
>
> > > live".
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > Karen
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > http://games.slashdot.org/story/10/01/19/1653240/Virtual-Currency-Becomes-Real-In-South-Korea
>
>
> >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > Virtual Currency Becomes Real In South Korea
> on
>
> > Tuesday
>
> >
>
> > > January 19, @01:29PM
>
> >
>
> > >
>
> >
>
> > > Posted by Soulskill on Tuesday January 19,
> @01:29PM
>
> >
>
> > >
>
> >
>
> > > from the license-to-print-money dept.
>
> >
>
> > >
>
> >
>
> > > money
>
> >
>
> > >
>
> >
>
> > > garylian writes "Massively is reporting that
> the
>
> > South
>
> >
>
> > > Korean Supreme Court has stated that virtual
> currency
>
> > is the
>
> >
>
> > > equivalent of real-world money. For those of you
> who
>
> > might
>
> >
>
> > > not be drawing the link, the core there is that
>
> > selling
>
> >
>
> > > in-game currency for real money is essentially
> just
>
> > an
>
> >
>
> > > exchange of currency and perfectly legal in
> South
>
> > Korea.
>
> >
>
> > > This could have sweeping implications for RMT
>
> > operations the
>
> >
>
> > > world over, not to mention free-to-play games
> and...
>
> > well,
>
> >
>
> > > online games in general. The official story is
>
> > available
>
> >
>
> > > online from JoongAng Daily."
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > _______________________________________________
>
> >
>
> > >
>
> >
>
> > > Opensim-users mailing list
>
> >
>
> > >
>
> >
>
> > > Opensim-users at lists.berlios.de
>
> >
>
> > >
>
> >
>
> > > https://lists.berlios.de/mailman/listinfo/opensim-users
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > _______________________________________________
>
> >
>
> > >
>
> >
>
> > > Opensim-users mailing list
>
> >
>
> > >
>
> >
>
> > > Opensim-users at lists.berlios.de
>
> >
>
> > >
>
> >
>
> > > https://lists.berlios.de/mailman/listinfo/opensim-users
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > --
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > _______________________________________________
>
> >
>
> > >
>
> >
>
> > > Opensim-users mailing list
>
> >
>
> > >
>
> >
>
> > > Opensim-users at lists.berlios.de
>
> >
>
> > >
>
> >
>
> > > https://lists.berlios.de/mailman/listinfo/opensim-users
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > >
>
> >
>
> > > -----Inline Attachment Follows-----
>
> >
>
> > >
>
> >
>
> > > _______________________________________________
>
> >
>
> > > Opensim-users mailing list
>
> >
>
> > > Opensim-users at lists.berlios.de
>
> >
>
> > > https://lists.berlios.de/mailman/listinfo/opensim-users
>
> >
>
> > >
>
> >
>
> >
>
> >
>
> >
>
> >
>
> >
>
> >
>
> > _______________________________________________
>
> >
>
> > Opensim-users mailing list
>
> >
>
> > Opensim-users at lists.berlios.de
>
> >
>
> > https://lists.berlios.de/mailman/listinfo/opensim-users
>
> >
>
> >
>
> >
>
> >
>
> > -----Inline Attachment Follows-----
>
> >
>
> > _______________________________________________
>
> > Opensim-users mailing list
>
> > Opensim-users at lists.berlios.de
>
> > https://lists.berlios.de/mailman/listinfo/opensim-users
>
> >
>
>
>
>
>
>
>
> _______________________________________________
>
> Opensim-users mailing list
>
> Opensim-users at lists.berlios.de
>
> https://lists.berlios.de/mailman/listinfo/opensim-users
>
>
>
>
> --
>
>
>
> -----Inline Attachment Follows-----
>
> _______________________________________________
> Opensim-users mailing list
> Opensim-users at lists.berlios.de
> https://lists.berlios.de/mailman/listinfo/opensim-users
>
More information about the Opensim-users
mailing list