29 exchanges approved to sell Lindens
Second Life customers who have difficulty buying Linden Dollars from the official LindeX exchange — your voices have been heard. When Linden Lab shut down all third-party currency trading in early-May, there was a mass outcry that included two public petitions. Linden Lab reversed course ten days later, allowing approved outside exchanges to sell — but not buy — Linden Dollars.
Since then, the list of approved exchanges has grown from five exchanges to 29.
Not being allowed to buy Linden Dollars from their users will hurt the exchanges’ bottom lines, however.
“We will make significantly less profit than before, it is evident,” Cash Services director Boris Kotovtchikhine told Hypergrid Business. His exchange reopened on June 1, after being down since May 13.
“But if it beneficial for anti-fraud, we will not complain,” he added.
According to Kotovtchikhine, his company lost almost a month’s worth of revenues as a result of Linden Lab’s handling of the situation. He did not provide exact numbers, but said, “the loss is very high.”
And the situation was particularly confusing for his customers, many of whom did not speak English and who were not aware of what was going on.
“We will seek to diversify in the coming months, so do not rely solely on Second Life,” he said.
Some exchanges have already branched out beyond OpenSim.
Austria’s VirWoX, for example, began trading the OMC — Open Metaverse Currency — in early 2010 with two German grids. The company now reports that more than 40 OpenSim grids use its currency. In early 2011, VirWoX also began trading Avination’s C$ currency.
Podex also trades in Virtual Highway V$.
“We will have to work harder to make a profit by not being able to buy Linden Dollars from avatars,” Podex CEO Jacek Shuftan told Hypergrid Business. Podex had even considered applying for a license as a U.S. money services business. But, after investigating the legal situation, decided against it, for now. “Of course, we do not know what the future can bring, but in the present situation we do not need an MSB license to resell Linden Dollars,” he said.
The First Meta Exchange has gone even further afield. In addition to trading Linden Dollars, the exchange also trades IMVU Credits, Toribash’s Toricredits, Frenzoo Gold Coins, FriendsHangout Tokens and NuVera Notes.
Shopping around for the best price
These exchanges are not all created equal, however.
Freelance online brand management consultant Joanna Bogacz visited each exchange to buy 1,000 L$, and compiled a list of their final prices here, including all the associated costs.
“I went through the whole ordering process and checked how much they add on the top of official prices listed on their websites,” she told Hypergrid Business. “The price range is huge. The most well known companies turned out to be the most expensive.”
Since many of the users of these exchanges are Europeans, the prices are in Euros, and range from 3.33 Euros for 1,000 L$ to 4.79 Euros. By comparison, as of this past Thursday, the price on the LindeX was 3.42 Euros.
“I’m checking on all the companies every few hours for the last three days and I´m not going to stop,” she said. “It’s quite important to me. I’m one of many people whose income is going to be affected by the change in the [Second Life] Terms of Service.”