Virtual World Currency Exchange Launches

Thanks to Terra Nova for the news that a MMO currency exchange website now allows cross-trading of virtual world currency, meaning you can trade your Ultima Online gold directly for simoleans from The Sims Online. Terra Nova notes that the site, the Gaming Open Market, "plans to cover [currency for] Ultima, Sims Online, There, EverQuest, Camelot, Star Wars Galaxies... and of course the US dollar." The FAQ page on GOM's site explains that "...in-game commodity transactions are handled by meeting a GOM representative (called an "associate") in your game", and explains the service's alleged advantages: "the GOM Currency Exchange (GCX) gives you the speed of a real-life discount stock brokerage, and provides the security of an escrow service, while bringing together buyers and sellers of common goods."

Comments

Embezzlement.

[jfisherwa]

This time next year, we should be reading about a nice big embezzlement scam and possible charges filed against employees or associates of one of those MMORPG developers.

Hmm. I wonder if they're hiring? ;)

As a former MMORPG player

[Kethinov]

As a former MMORPG player, I always found the concept of real life value to in game objects to be disgusting. I only played (Ultima Online) for the PVP and that's all I enjoyed about it. A few expansions ago I got fed up with the growing emphasis on player wealth. It got to the point where only the wealthy players could PVP successfully.

So I stopped playing. But like all good opportunists, I took advantage of what disgusts me the most: the value of my in-game possessions. I sold my in-game house on Ebay for $300 and all my in-game gold for a similar figure and reclaimed most of what I'd pumped into the game over the years. I could have sold my account for an equally large sum because it had a veteran status, but I'm only willing to sacrafice so much of my dignity. I don't think I could live with myself if someone was running around in-game with my name. :)

After I stopped playing it really started to dawn on my how much of a shady business MMORPGs really are. They're not about keeping you entertained, they're about keeping your subscription. Although, to be honest, the early years of UO were a lot of fun. I'm just glad I had the good sence to bail out when I realized it was more frustrating than fun.

Re:As a former MMORPG player

[jjhlk]

They're not about keeping you entertained, they're about keeping your subscription.

I would think most people keep their subscription because they stay entertained. That's how my friend played Anarchy Online; he played until he was bored of it, and cancelled. FunCom will keep your player data, so if you choose to play again you don't have to start a new character. My friend has played on and off again, usually when they introduce new content.

So why else would people play? There is addiction, but I doubt that is used as business model.

Psst! Hey you, over here.

[orthogonal]

Psst!

Psst! Yeah, you!

Hey, ah, you wanna buy some, ah, Slashdot mod-points?

Yeah, they're real! Honest to Taco mod points.

I gots some "Interesting"s, some "Troll"s, a "Flamebait", couple "Informative"s, and a bunch of "Funny"s. Well, because the "Funny"s don't increase Karma, so there's an over-supply.

You can have 'em all for 200 simoleons or 75 gold pieces, or a light-sabre, or....

So what stops me from...?

[MarvinMouse]

Setting up some bullshit bot to make as much money as possible in one game, and then just trading it for US dollars?

Like, if there are no prevention on that, then that's what I am going to do, but some stupid Sims Online bot that just makes sure my character stays alive and leave the program running in the background. If I can earn more money than I pay in subscription fees in a month, it's basically free income.

Obviously there has to be some serious restrictions.

Re:So what stops me from...?

[nifboy]

People have been running bots and selling the rewards on eBay for years now. A currency exchange isn't gonna change that.

Re:So what stops me from...?

[Elwood P Dowd]

Uh, the trading company doesn't care how you get the money. So long as you deliver. The company running the MMORPG might care, but...

I highly doubt you'll be able to recoup more money than you spend. If you can, then everyone will do it, and prices will go down for that type of currency.

Of course, that's the whole point of a market. You'll find the correct value sooner than later.

Re:So what stops me from...?

[m0rph3us0]

You being too lazy to do that...

Re:So what stops me from...?

[Hythlodaeus]

Nothing stops you. Many of the richest players in UO got that way from scripting their characters to mine ores 24/7 without player intervention. They then ebay the gold gained from selling the metal. Getting caught running an unattended script means being banned, but these people usually have several accounts and make more than enough to offset an occasional account creation fee.

Re:So what stops me from...?

[Chester K]

So what stops me from Setting up some bullshit bot to make as much money as possible in one game, and then just trading it for US dollars?

Currency devaluation. Basically the same reason that Bill Gates can't just print off new Microsoft stock certificates indefinately and expect them to keep selling at today's price.

One would assume that the people at GOM have done their homework and have a fluid pricing system that reacts to the changing market desires. If they don't, they'll be broke within the week.

Re:So what stops me from...?

[Suppafly]

I highly doubt you'll be able to recoup more money than you spend. If you can, then everyone will do it, and prices will go down for that type of currency.

It's relatively easy to make more money than you spending subscription fees for a MMORPG, the problem is the time involved. If you paid yourself a reasonable wage for playing the game, you couldn't come close to making more money than you invested.

I hope they hire an accountant

[automandc]

From their "Fees" Page:

GOM charges 1% of the total amount deposited as an in-game deposit fee. The fee is payable in the currency being deposited and will be automatically deducted from your deposit upon delivery. For example, if you deposit 101,000 UO gold with a GOM in-game associate, you will be charged 1% (1,000 UO gold) and your GOM account will be credited 100,000 UO gold.

I may be a lawyer because I failed math, but even I know that 1% of 101,000 is 1010, not 1000. So, if you deposit 101,000 you should be credited with 99,990. A better (more accurate) example would be: deposit 100,000 and we will credit you 99,000 (100,000 less 1%).

Incidentally, this is exactly the same incorrect application of percentages that is used in Candadian rest stops along Route 401 in Ontario.

I hope they clear that up before any regulators get involved!

Re:I hope they hire an accountant

[Sylver Dragon]

It depends upon how its charged. If they tell you to come up with a sum to be deposited, and then they charge a 1% fee of that, you would, in fact, give the GOM 101,000 GP to end up with a deposit of 100,000 GP. Which is a much nicer way to go about it than telling people that a 1% charge will be levied against the monies given. Which would end up with some screwy numbers. For example, to get 100,000 GP final deposit, we would have to do something like:
X * .99 = 100,000
X = 100,000 / .99
X = 101010.10101010........
Do you really think they want to put a customer through this?

Re:I hope they hire an accountant

[Pyro226]

Incidentally, this is exactly the same incorrect application of percentages that is used in Candadian rest stops along Route 401 in Ontario.

What do they calculate wrong? (I'm just currious, and I'm not sure what you're refering to.)

You're now on my friends list, because I need a lawyer - and I'm thinking of moving to Canada because of it. Life is full of connections.

Re:I hope they hire an accountant

[jamiehale]

A valid point. The fees have been changed to apply a 1% charge to the amount deposited. Indeed, I did not intend to put my clients through that insanity.

Re:I hope they hire an accountant

[automandc]

Further explanation about the Canadian crack, since I was asked:

The problem has to do with confusing ratios with percentages. If you go to the rest area, they have (used to have? I haven't gone in 10 years) a sign that says something like "Exchange rate: $1.00 CD = $_.__US" and have a little adjustable number. For instance, it might say $1.00CD = $0.75US. This indicates a conversion ratio of 4:3.

So, say you have an order that totals $10CD. When you say that you want to use $US the employee looks at the sign and says (to themselves) "OK, the $US is 75% of the $CD, so subtract 25% from the $CD to get the $US." They punch into their calculator "10 - 25% =" and get $7.50(US), which is correct. This logic is induced by the sign's using $1.00CD as the base, and the fact that both currencies have 100 cents to the dollar, making it easy to (incorrectly)think in percentages.

You hand over a $10US. Now you are owed $2.50US change, but since they only return change in $CD, they have to convert the $2.50US back to $CD. The correct way to calculate that would be to multiply it by the 4/3 (1.33) ratio, yielding $3.33CD.

Unfortunately, the McEmployees figure "I subtracted 25% going one way, I just add 25% going the other" This results in them reversing the transaction on the calculator thusly: "2.5 + 25% = ". So, instead of $3.33CD, you get $3.13CD (2.50 + 0.625). The fundamental flaw is that the sign reflects a ratio not a percentage. You end up being shortchanged $0.20CD, which is $0.15US (or 6% of the total change owed in that example).

Depending on the current conversion rate, and therefore the numbers on the sign, the stronger the $US is against the $CD, the worse it becomes. For instance, if the sign says $1.00CD = $0.62US, for $2.50 US change you should get back $4.03CD. Instead you get $3.45CD (2.50 + 38%), which is $0.58US less than you are owed(or 23% of the value of your change).

Of course, if the $CD is stronger than the $US than it works to the $US currency user's advantage, but that rarely happens. Also, I haven't driven the 401 for 10 years, so maybe they have figured it out.

Plan

[dtfinch]

1) Write bots to play many popular mmorpgs.
2) Join the Virtual World Currency Exchange.
3) Profit!!!

Shuffling around your wealth (Or: starting "anew")

[nifboy]

This could be a great help to those who want to switch over to a different MMORPG but not want to lose all the effort they've already put into their old character. You could start the game with millions of the local currency just by converting the wealth of your old Everquest characters.

As soon as these guys set up Everquest, FFXI, and/or SWG branches look for flocks of people using this service.

I wonder what the average player makes, in USD, in an hour of playing an MMORPG....

Granted...

[Auburn_Jack]

...I haven't bothered with online games in a few years now, so I have no idea how well their creators enforce their respective EULAs these days.

But isn't something like this just waiting for Verant/Mythic/whoever to release the hounds? After all, this is different from a year-old account changing hands. This allows new characters to have a shortcut to mass amounts of funds by way of a non-company program (the MMOG at the starting end of the conversion) and third-party intervention (the website and its "in-game representatives"). Which is, uh, cheating.

Re:Granted...

[Dachannien]

This is certainly a much easier target than the zillions of eBay transactions that go on. IANAL, but I was under the impression that you could be civilly liable if you, as a third party, interfere with conformance to the terms of a contract.

where do they get the real money?

[gl4ss]

and doesn't this make it possible for game makers to pump them out of their money(since they can make that money, and the invented resources that make 'worth' something as they please)? what transfers of money that don't balance, like, if there comes a new game and everyone moves away from some older game and transfers all their cash in that old game to the new game(in that case they end up with gazillion funbucks of some game that are not worth anything).

like, surely this can't be a good long term business plan? for some quick running sure.. but they're bound to get screwed.

Re:where do they get the real money?

[Carnildo]

The only way to turn your in-game currency into money is for someone else to buy it -- either another player, or an interested third party (speculator). This company isn't buying and selling currencies themselves, they're just providing brokerage and escrow services. If a game company were to pump out trillions in in-game currency, all they'd succeed in doing is triggering in-game hyperinflation, driving away players whose life savings can't buy anything anymore, and driving down the value of the currency on the open market.

Please add DM, FR, Yuan, Yen, and Sterling!

[aminorex]

A disintermediated retail forex would rock
my world. Play money might be nice too, but
only after substantial research.

Re:Please add DM, FR, Yuan, Yen, and Sterling!

[GoRK]

If they did that, they'd open themselves to real currency trading and would thus be required to be registered with the SEC and insured. As it stands now, they probably have to at least have an auctioneer license to do what they do. Depending on how the exchange to/from US dollars works, they may require some sort of registration there also...

~GoRK

Obvious question

[Embedded Geek]

I rememebr when Sony was going after everyone who auctioned EQ items & accounts on Ebay, saying it violates the terms of service (and, yes, I know you can still find auction sites if you look hard enough where this hasn't been shut down). Wouldn't cashing out EQ PP's be basically the same thing? The FAQ dances around this by simply saying they're a currency exchange. I only skimmed it, but it appears they don't touch TOS issues at all.

Does anyone have a take on this?

Re:Obvious question

[Embedded Geek]

Hmmm... Since I'm not in the markst, I hadn't thought of the obvious approach. I wonder if it would work for other metals.

The Ultimate SOE Revenge

[Mike Hawk]

or, How I Learned to Stop Worrying and Love the Almighty Dollar.

So you say you are setting up a service to profit from our game without us getting a cut? Well we could try to EULA you out of existence, but we have a better idea. One day, after you are nice and operational and have plenty of liquid currency deposited we plan to do one of two things:
1) Change currency to something else entirely making all currency held obsolete and worthless, or
2) Multiply all in-game prices and creature drops by a factor of 1000000. A rat that used to drop 1 copper now drops 1000000 copper. A sword that used to cost 5 copper now costs 5000000 copper.

Whats that? But you already paid out significant amounts of real US Dollars for the currency you have in stock? A noobie can walk outside of town and trip over that much in-game money? You just lost a ton of operating capital and your investers and customers don't trust you anymore? Dang, sucks to be you.

GG

PS These comments, nor Mike Hawk, represent SOE, EA, Lucasarts, George W. Bush, Principal Skinner, or any entity public, private, or imaginary, this is just what I would do because I can be a vengeful arse.

Re:The Ultimate SOE Revenge

[Carnildo]

That'll just screw over the existing players. The GCX won't care -- they're not the ones buying and selling currencies, they're just providing brokerage and escrow services. All they'll need to do is multiply the size of their basic currency block by a million, and they're back in business.

Re:The Ultimate SOE Revenge

[Mike Hawk]

Except they would have to put up most of the up-front cash to get this thing going. They buy the online currency high to get moving, but then the online currency gets devalued. Get it?

Re:The Ultimate SOE Revenge

[PainKilleR-CE]

The only up-front cash they're actually putting up is for the accounts for the 'associates' that handle the transactions in the game, and from the looks of it they may not be paying those costs, either (though I can't be sure).

Otherwise, the only thing devaluation of currency does is effect that particular's game's currency's value on the market. They simply find one person that wants to sell say UO money and wants Sims money, another person that is selling money for another game and wants UO money, and someone that's selling Sims money and wants money for that other game, and arranging the transactions for a small percentage. The simplest example is when someone is selling UO money for cash, and someone else is buying UO money for cash, they simply handle the transaction (again, for a small percentage).

Essentially, the only money they should be keeping around is their cut, because they find a buyer for the money someone is selling before they take it off the seller's hands.

It's not much different from Ebay, except that it's specifically for handling game items, which have specific problems associated with them (like delivery), and they're adding some assurance much like PayPal is supposed to add, that you'll actually get the money in the currency you're looking for. Whether or not you will depends on whether or not someone's selling, and how much money you get depends on the value of that currency.

In the long term, the only way that devaluing currencies can hurt them is if they're stock-piling their cut and playing the market to turn their cut to cash at the best time rather than doing it whenever possible. At that point, they're playing a market just like people do with stocks or real currency markets, and it's their loss if they hold onto significant amounts of in-game currency (and someone finds a way to devalue that currency).

What?

[ConceptJunkie]

No Zorkmids?!

Re:What?

[Gloume]

Nethack would have to be MM before they could do that. Unless you could sell bones files. I could replace mine with yours and I might one day trip over your corpse with 1,000,000,000,000,002 zorkmids on it.

Hey Guys! I got one trillion simoleans!

[JExtine]

Sounds like the only thing that is going to get exchanged is costumers virutal money, for the website's real money. By the time they are bankrupt though, they'll be able to virtually buy anything they want.

Please do that

[cgenman]

Please, Please setup robots to play online games in some significant fashion that disrupts their economy. Perhaps then designers will create games that don't consider

10 Dig for an hour
20 Rest for an hour
30 Goto 10

a winning formula for gameplay.

Economy

[Xistic]

There is a real chance that this could hose the economy of the more popular MMORPGs. As people move their money from older games to the newer ones inflation will skyrocket and the dropped gold from quests and monsters and such will not be significant enough to persue.

This is after serveral newbs have used this produce wealth not directly attributed to their charecters performace. At least more so then having friends help out.

This will leave new players of MMORPGs in general at a huge disadvantage as they don't have an older game to pull from when inflation is rampant.

Kyle

Re:Economy

[Texas Rose on Lava L]

Not really. If no one is playing the older game anymore, the old-game currency would be close to worthless (lots of supply and little demand). Trading old-game money for new-game money would be like trading shares of Enron for US dollars.

I think the bigger concern would be people with a lot of US dollars to convert to game money, combined with people who have a lot of time on their hands using bots to collect money and selling it. The result is more bots than you would otherwise have and, as a result, high inflation. The inflation affects "normal" players by making the items more expensive without making it any easier to collect money by going out and fighting monsters.

Against License Agreement?

[poppen_fresh]

IIRC, isn't this against most games' EULAs?
I know it was mentioned earlier that Sony went after people selling their EQ stuff on EBay. Wouldn't these "associates" have their games accounts banned?

I think people are missing the business model

[DJ Wipeout]

The business model isn't "give us your in-game cash and we'll give you US dollars", it's "deposit your in-game cash with us and then you can use that as a commodity in our online trading website for commerce with other registered users".

Think of it like paypal. You give 1 million UO gold to the duly-appointed GOM representative on your server, and your account on the website gets updated to reflect your deposit. (minus the appropriate fees of course) Now, you can log into the website and look at the exchanges, and put that money up for sale. Other users will see that and can purchase it for the price you put it up for, or ignore you. If it doesn't sell, you repost it at a lower price or whatever. If it does, you've got US cash in your account that you can subsequently withdraw or use to purchase other commodities, such as currency in a different game.

Putting MMORPG currency into the system doesn't guarantee you US dollars out immediately. And since GOM takes a cut of every transaction, they're not going to go bankrupt how you expect them to.

History repeats itself...

[Stormwatch]

Tulipomania, anyone? [ http://en2.wikipedia.org/wiki/Tulipomania ]

Do you have to be present?

[Lord_Dweomer]

Here's the question I'm wondering about. Do you have to be in at least one of the games to get/make the money? Because it would seem that the only way you can use this exchange system is if you play one of those games. But in real life, we have bank accounts that can transfer the money so you don't have to do it physically, thus enabling quasi-realtime trading of currency.

Perhaps someone with more of an understanding of currency trading can explain a bit how this works, and compare and contrast it to the real world currency brokers run things at the exchange.

N-Gage to dollar exchange rate?

[Mirkon]

I think the real question is, how long before the N-Gage appears as a type of exchangeable currency?

admins are gonna love this

[7-Vodka]

The in-game admins are gonna have a field day with this.

*clicky* *clicky* and they give themselves 1,000,000 gold pieces to trade for some us dollars.

Re:admins are gonna love this

[will_die]

Thier have been services in the past the just purchased currency. Most current games prevent regular admins from creating items, and also keep track of what they create or modify.
Thier have been a few times were they have been caught, usally because they do it to often and people talk.

^Somewhat Baseless Hype^

[TubeSteak]

Part of running a currency exchange is that the rates are flexible. What you just described is called hyperinflation. Guess what, it might matter for about a fraction of a second, then the automated trading systems will adjust exchange rates accordingly.

Your basic premise is correct, futzing with ingame prices and $$ values may or may not be a nuisance. I think its doomed to fail because:
1. Its easy to accumulate money ingame (if you just grind it out)
2. Its on shaky legal ground. Currency exchanges and commodities are generally heavily regulated (not sure about Canada)
3. They take no responsibility for anything. One sustained DOS attack or a hacker can thrash everything and you're S.O.L.

This is a joke

[MBraynard]

Even within games there isn't enough demand for ingame currency for ingame, player operated banks that charge interest. Do you think there is actually goingt to be any CROSS game interest?

All that work for a spark of interest at the begining that will quickly die off as these scammers find their only customers are people trying to scam them. Psh.