In a post from Zee Linden today, the Lindens try to once again state that they have no plans to regulate Second Life banks, and that if it seems to good to be true, like Ginko Financial was, then it probably is. Until some regulations on banking and the stock exchanges are put into place that can hold people accountable for theft, fraud, etc, then I would keep my lindens in my virtual pocket, or transfer some out occasionally so too much doesn’t build up. If you put it in a bank, you are on your own as far as they are concerned.

It is important here to distinguish between real-world banks and the “virtual banking” services that some people are trying to develop in Second Life. From a simple perspective, banks exist in the real world so you have a place more convenient than your mattress in which to store your cash. Banks in the real world attract capital by offering to pay an interest rate. They then turn around and try to lend that capital to worthy borrowers earning money on the spread between the interest they pay and the interest they earn. Because Linden Lab holds everyone’s L$ as a database entry in each account, virtual banks don’t offer a superior “storage” alternative.

Probably the most important point is that real-world banks are regulated by real-world laws. Linden Lab does not intend to recreate or subvert real-world laws in any way. We are not aware of any institutions in Second Life that are insured by the Federal Deposit Insurance Corporation or similar governmental agencies in other countries. We caution our residents to be wary of anyone offering extremely high interest rates at no risk, either in the real world or in Second Life — if it sounds too good to be true, it probably is. Source: The Second Life Economy

He also discusses the Linden, the Second Life virtual economy and inflation, and some of the sinks they use to drain some lindens back out. (i.e. how we pay for our stuff in-world).

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