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