Second Life Bans Traditional Banking

Linden Labs recently announced a ban on all in-game banking institutions that "offer interest or any direct return on an investment" without the same government regulation that applies to banks in the real world.

SOURCE: Wired

This drastic step comes in reaction to the dissolution of the unregulated Ginko Financial, an in-game bank whose failure saw investors (read: players who had deposited money) lose the equivalent of $750,000.

The decision was widely seen as a necessary step by Linden Labs to avoid governmental intervention.Had the company not banned these unregulated banks, most presumed it was a matter of time before the state government of California (under whose laws Linden Labs operate) stepped in and forced regulations into every financial aspect of the title.

Linden Labs plans to remove all virtual ATMs and other such interest-granting banking institutions from the Second Life world by Jan. 22, 2008, and have politely asked "that between now and then, those who operate these 'banks' settle up on any promises they have made to other Residents."

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