The Virtual Reality Economy of Second Life

Second Life logoI heard on the radio this evening that Reuters is opening a “bureau” to cover news in the virtual world—an online role-playing game—called Second Life.

This world is so immense and detailed, it allows the “players” to participate in any activity they could in the real world. You can open businesses, participate in communities, buy land, and hire people to build homes in 3-D through the Internet. This virtual world uses its own currency, called Linden dollars. Each day, the exchange rate between US dollars and Linden dollars is calculated based on supply and demand. Your membership fee is charged in US dollars, but to own land or to make other purchases, you pay in virtual Linden dollars.

However, Lindex dollars aren’t exactly virtual. Thanks to the many people who play the game, there is a demand for the fake money. The fact that people are willing to buy Linden dollars to participate in the game legitimizes the currency. One prominent virtual real estate broker makes $100,000 a year. In real money. This income isn’t even taxed! Have no fear, Congress—the real, not virtual Congress—is looking into that.

Adam Reuters, the Virtual Life citizen representing the Reuters organization, interviewed the CEO of the biggest (possibly the only) bank in Second Life. To me, it seems like this economy is not quite ready to be legitimate. Nevertheless, you can currently trade L$275.5 for US$1.

Want more Second Life news? Visit the Second Life Reuters News Center, headed by Adam Reuters (also known in the real world as Adam Pasick). Here is his interview with Marketplace, a real-life radio program.

Scroll down to read 3 comments on “The Virtual Reality Economy of Second Life.”

Related Entries on Consumerism Commentary

3 Comments on “The Virtual Reality Economy of Second Life.” To add your own comment, scroll down.

  1. Comment #1 by GaryP (reply)
    October 23rd, 2006 at 6:12 pm

    If he earned $100,000 in the real world – then it is taxable – now, he may be hiding it from the IRS but that is another story.

  2. Comment #2 by mbhunter (reply)
    October 29th, 2006 at 12:23 am

    A friend from work is a land-owner—he’s just in the black this month. Crazy black hole for time, though.

  3. Trackback #3 by » H&R Block Opens Virtual Tax Office on Consumerism Commentary: A Personal Finance Blog (reply)
    March 19th, 2007 at 12:13 am

Leave a Comment

Enter your comments below. Please note: Use of a non-personal web site or blog in the field below and/or comments that are off-topic, personal attacks, or support requests will likely be removed at my discretion.

Copyright of comments belongs to the comment author, but I reserve the right to edit comments for formatting or content.

Add a photo or icon to your comment by creating an account on Gravatar.

Welcome to Consumerism Commentary

Consumerism Commentary is a blog for men and women who wish to make the most of their financial lives. Read more about Consumerism Commentary.

Cash Loans
CSA 120x120 Animated

Advertise here (more info).
Earn money as an affiliate. Join here.

Contributors

Subscribe via E-mail

Credit Card Offers

Recent Comments

Best of Consumerism Commentary

Recent Articles

Popular on pfblogs.org

Disclaimer

The authors of Consumerism Commentary are not professional financial advisers and no text within this website should be considered financial advice. Any individual who makes financial decisions based solely on the information contained within does so at his or her own risk. Always consult a financial professional.

About Advertising

This website contains advertisements, usually listed as “sponsors.” Some links are for products or services for which Consumerism Commentary is an "affiliate." No articles within the blog are advertisements disguised as blog entries. Consumerism Commentary is not compensated for any content, except for advertising sold. This site contains no Pay-Per-Post (or similar) articles.

Privacy Policy

Carnival of Personal Finance