Banking Crisis in Second Life and the Convergence of real and virtual

Second Life Research: Banking Crisis in Second Life — Calls for Regulation

This blog post form one of my new favorite blogs, Second LifeResearch (because it helps me sort out the reams of info about SL) describes how an investment bank with $750,000 collapsed.  With no SL FDIC to back up deposits, the money is gone.  While this will surely make many people’s jaws drop as they start to mouth silently or out loud “what kind of idiot would put real money in a virtual bank?!?!” the blog post points out that many residents have nothing esle to do with their money. The fallout will be more oversight, by organized residents or Linden Lab itself, or, more likely, both.

I was thinking more about Edward Castronova’s point in Synthetic Worlds.  In the introduction, I found him trying to say that synthetic worlds have many of the same features as real worlds.  As they become more ubiquitous, they will become more like the real world.  This is the convergence argument.  And I find it compelling.  This banking story is a great example.  However, Castronova, at the same time as he is normalizing synthetic worlds to make them palatable to the academic/technophobe crowd, wants and needs to say that there is something profoundly unique in them  Well, this presents a dilemma.  SL is supposed to be just like the real world and also totally different!

As I read the book more, and think about my own research, I will have to resolve this dilemma more satisfactorily.  What is distinctive about the sociology of Second Life?

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Filed under Banking, Information and Communication Technology, Second Life

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