This Saturday at The Science Circle

 

 

Saturday April 19

 

    ~*~

 

    At 10 AM PST   

    SC Formal Debate: Regulation of AI

    https://www.sciencecircle.org/event/debate-regulation-of-ai/

    Moderated by Stephen Gasior

    Location: Science Circle Forum

 

    ~*~

 

    NOTE: Non-members required to register once

    IM Jes Cobalt or Nymf Hathaway

╚══════════════════════════════ The Science Circle (72,129,30) ═╝

 

New Guidelines on Virtual Currency by US Government Mean Complications For Linden Lab

By Bixyl Shuftan

Last month, the US Treasury Department's Financial Crimes Enforcement Network (FinCEN) issued an "interpretive guidance" (pdf link) or guidelines for the regulation of virtual currencies. Alex Kadochnikov of the "Modern Payment Systems" blog had a few things to say about the matter and what it means for Linden Lab. For the average Second Life resident, these guidelines don't directly affect him/her. But for Linden Lab, "FinCEN now considers Linden Dollar as a convertible centralized virtual currency," and it means regulations and paperwork.

To begin with, Linden Lab's terms of service doesn't refer to Linden dollars as virtual currency but each being a "virtual token" or a "limited license" that could be traded, "Linden dollars are not real currency or any type of financial instrument …" But these words haven't meant much to residents who've treated it as money within Second Life, the only risk being if they ever lost their connection to the Grid. As Kadochnikov wrote, "FinCEN goes by the approach 'If it looks like a duck, and quacks like a duck, it is a duck.' And Linden Dollar sure does 'quack' like one. Linden dollar is a virtual currency because it has value in real currency (a buck will buy you about 270 linden bucks); and people buy good and services with it."

As "an administrator and an exchanger of virtual currency" they were a "Money Service Business" or MSB under US Treasury guidelines. As a result they, "must register with the Treasury Department and make Anti-Money Laundering and periodic reports." This means more expenses for Linden Lab as, "these reports are not little one page chores a trained monkey can do. There is a reason corporate compliance departments are stacked with lawyers and accountants. As you can imagine both of these items cost a lot of money."

Hamlet Au thought that this would mean Linden Lab will have to hire two or three additional lawyers just to deal with this matter, costing them about a half million dollars a year. The only other option it seems would be to abandon the Linden dollar and deal just with real world currencies. While it would save them these bureaucratic headaches, it would be "like turning off a printing press that prints money. And who in their right mind wants to do that?"

Hamlet Au thought there was one additional complication. If the Lab was thinking of selling Second Life, it just became more difficult as any buyer would have to deal with these regulations and expenses. One result of the Treasury Department's new guidelines may be that Linden Lab can pretty much forget about someone buying the virtual world from them.

Second Life Newser did briefly discuss the matter with Jacek Shuftan, the head of it's sponsor Podex Exchange. He expressed suspicion of the US Government's motives, but "every coin has two sides, if (Linden dollars) were virtual currency, it would be more trustworthy, and (Second Life) will have more investors." So perhaps the move has some benefits.

Sources: New World Notes, Modern Payment Systems

Bixyl Shuftan

Proposal for UN Agency to Control the Internet

It was almost a year ago in which the proposed SOPA bill threatened do away with the Internet as we know it, including places such as Youtube, Facebook, and Second Life. Today, there's something else that's gotten the attention of Internet advocates: a proposal turn control of the Internet to an agency of the UN.

The ITU, or International Telecommunication Union, is an agency of the United Nations dealing with information and communication technologies. At this time, there is an international meeting of delegates in the Persian Gulf Emirate of Dubai to discuss a plan that would hand the ITU control over the Internet. Currently the entity in charge of the Internet is ICANN which does so through an agreement with the US Government with "a mandate requiring that it operate in a bottom up, consensus driven, democratic manner). A leaked document suggested the delegates of some nations were pushing for a global Internet tax. While worrisome in itself, what got Internet freedom activists more worried was that the plan would allow nations full control of how the Internet operates within their country. For repressive nations, this would mean full power of censorship over online communications. Undemocratic countries such as Iran and China, which already censor websites their rulers don't like, would this time have the blessing of international law.

Vint Cerf, the Vice-President of Google, spoke out against the proposed regulations, "only governments have a vote. Some proposals coulees allow governments to justify the censorship of legitimate speech, or even cut off Internet access." Openness, he argued, was a founding principle of the Internet, "Our protocols were designed to make the networks of the Internet non-propietary and interoperable. … allowed for contributions from many sources. This openness is why the Interned creates so much value today."


Google has also launched a petition against the ITU proposals, "A free and open world depends on a free and open Internet." As of December 3rd, about one million had already signed, the results shown on an interactive map.  Mozilla, the company behind Firefox, has also acted against the ITU plan with a commentary calling for it's rejection, "Why is ITU Governance of the Internet a Bad Idea," and providing "a kit of tools and resources to support people in making their voices heard at the ITU."

The European Parliament has already rejected the plan for the UN agency to take control of the Internet.

To sign Google's petition, Click Here. 

For Mozilla's tool kit Click Here.

Bixyl Shuftan