Second life economic crisis, bank run on Ginko Financial

August 8th, 2007

Technology Review reports on Money Trouble in Second Life.

“There’s a long line of avatars waiting to use the automatic-teller machines for Ginko Financial, a virtual bank in the online game Second Life. For more than a week, account holders have been demanding their money back in what some folks are calling a bank run. Set off by high interest rates and a recent ban on in-game gambling, the bank run could ultimately have a major effect on the game’s economy. The theft of approximately $12,000 from the Second Life World Stock Exchange doesn’t help matters either.”

Unlike many MMOGs, Second Life has an active economy based on the Linden Dollar (L$) and encourages users to buy and sell game goods and real estate to one another. While the currency is fictional, TR reports

“But those dollars do have real-world value: players can buy or sell Linden dollars at a rate of about L$270 to $1 on the Lindex market. Second Life’s website even boasts that “thousands of residents are making part or all of their real life income from their Second Life businesses.”