Summary
Banks and payment processors need to develop expertise to identify and support virtual world transactions. Banks need to manage virtual risk because it involved real growth and real losses.
Analysis
All of a sudden the virtual world is creating real world financial losses and presenting real world risks.
We should all make note of the announcement that Second Life has banned unregulated banks. Sounds ridiculous but all virtual banks, as of January 22nd, that offer interest or returns on investments must now provide proof of a real world government registration or financial institution charter.
All of this because a virtual bank, Ginko Financial, collapsed due to a run on its virtual ATMs. Also, the virtual "World Stock Exchange" was robbed of $3.2M in Linden dollars by a former employee all while hackers stole a similar sum from real world banks.
This all sounds like a real world problem given that Linden dollars trade at about 270 to 1 against the U.S. dollar.
Most recently it was bricks and mortar and then clicks and mortar reflecting our societal move to electronic commerce.
It seems to me that virtual worlds are in the early stages of creating another economic dimension with real world impacts and our banks, credit card companies and reporting agencies need to pay attention and put real monetary risk assessment and transaction processing capabilities into the virtual world.
Financial institutions that are already in Second Life include ABN Amro (The Netherlands), Saxo Bank (Denmark) and Creditcard Citi (CitiGroup- Brazil)
