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Banking on the Virtual
Aziphirael
post May 3 2007, 11:03 PM
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Entropia Universe hit another milestone today when the five bank licenses which had been on auction for the last three months ended. Each license gives the owner a 2 year exclusive license to run and provide credit facilities within the virtual universe. What was more intriguing was that bona fide financial institutions in Real Life would be able to provide a host of additional services that would link the virtual world with external banking systems.

The auctions ended in a flurry of tense activity, closely watched by the citizens of Entropia. Fierce bidding started two days before the end, with Anshe Chung and Neverdie both competing on a number of the licenses, yet, it was only in the last few minutes that some of the other players in this game revealed themselves.

By the sound of the final bell, the results were as follows:
  • Licence #1: Yuri iNTellect Efremov - 999,000 PED ($99,900 USD)
  • Licence #2: Jolana Kitty Brice - 950,001 PED ($95,000 USD)
  • Licence #3: John NEVERDIE Jacobs - 900,002 PED ($90,000 USD)
  • Licence #4: Janus JD D'Arcwire - 590,608 PED ($59,060 USD)
  • Licence #5: Baroness Anshe Chung - 600,000 PED ($60,000 USD)
A total of 4,039,611 PED was spent to purchase the licenses, which at the fixed currency rate of 10 PED to the Dollar comes to just over US$400,000, far outweighing previous records set in Entropia Universe.

Unsurprisingly Anshe and Neverdie were the front running contenders. Neverdie who made the news with his US$100,000 purchase of Club Neverdie has been a long time player of Entropia Universe and one of its greatest supporters. Anshe Chung is a more recent participant to Entropia Universe, yet has built up an enviable business reputation in the metaverse of Second Life, garnering plenty of attention and press coverage for her enterprises.

At the same time there had been a great deal of community speculation that a Real Life bank could be involved. The more pessimistic raised concerns that this was a "bridge to far" for MindArk, citing them as glorified pawn shops due to the method that a loan is given to a participant. Yet the bids do represent a ringing endorsement of the virtual universe of Entropia by participants who are prepared to invest the sums involved.

All licence holders now have 20 days in which to present the one million PEDs required to run the bank. It certainly opens up further opportunities for particpants of Entropia Universe, as well as drama, controversy and excitement in the next couple of years. Something that mindhive will be following closely and reporting on.
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Svetlana
post May 3 2007, 11:59 PM
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Thanks for the write-up Azi.

As suspected, these licenses sold in the final minutes. Not necessarily expected was the amount of money involved. Of course we've all been debating the value of the banks, both literally and figuratively, for some time on the other thread (for guests and newcomers, check here:Virtual Bank License Discussion.

There are no MindArk press releases on the subject on their homepage as of yet. As Azi points out, the new owners have 20 days to aquire one million PEDs to keep their banks. Between now and then, we may see some shuffling ocurr, which will be interesting no doubt if it happens.

This post has been edited by Svetlana: May 4 2007, 12:02 AM


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King Buzzo
post May 4 2007, 12:24 AM
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For those who are interested, the story is here as well as here. More to follow I am sure.

It will be very interesting to see what the new owners have planned. I look forward to hearing thier visions over the coming weeks.

This post has been edited by King Buzzo: May 4 2007, 12:30 AM
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Svetlana
post May 4 2007, 12:59 AM
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And thank you Buzzo for feeding this to the very well respected 3PointD.com, who has published it on their homepage to be viewed here:
3PointD


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Aziphirael
post May 4 2007, 08:41 AM
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Goods stuff. Good to see its out there in the blogosphere. I saw that Neverdie's been capitalising on the news as well through my Google feeds.

I notice Mark Wallace at 3PointD went for the Anshe Chung angle as it were on the License. If anything thats the big news on this. Neverdie once again seems unable to shake of his previous connections with MA, seems like he will have to live with that for some time to come.

The question is, did Anshe make a shrewd investment? Granted she bought her bankd license for about US$30,000 cheaper then a lot of the others. I suspect we will find out how things pan out when MA unveils how they plan on locating the banks.
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Epictetus
post May 4 2007, 02:24 PM
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Nice writeup Az.

It will be most interesting to see the location of the banks and the interest rate and duration of the loans.

I hope, even with shuffling of ownership, that one individual or business does not hold more than one license for the reasons of collusion that I mentioned elsewhere.


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King Buzzo
post May 4 2007, 03:16 PM
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QUOTE (NEVERDIE Press Release)
One of the 1st Five Virtual Bank Licenses Acquired by Jon Jacobs aka NeverDie of the Entropia Universe
Popular Avatar Represents USA in Competitive Bidding War for Virtual Bank

MIAMI--(BUSINESS WIRE)--Jon Jacobs aka NeverDie, entrepreneur and virtual world nightclub impresario of Club NeverDie in the Entropia Universe, has just announced he has won one of the first five virtual bank licenses for $90,000 (U.S.). NeverDie’s virtual bank will specialize in short-term bridging loans to help finance avatars building virtual manufacturing and construction companies.

“We had a ball,” said NeverDie. “The auction came to a close to virtual cheers, dancing and champagne popping when the more than 125 visitors to Club NeverDie’s VIP bar got the official word that Anshe Chung and I scored two of the coveted five banks on the block. We gamers achieved victory!”

Exclusive to the Entropia Universe, the auction kicked off February 2007 and just closed this morning at 11:30 AM EDT. In the fierce bidding war between real-world banking institutions, famous avatars and private investors, prices started at $0.10 (U.S.) and climbed to $99,000 (U.S.) for the number one bank placement. These five licenses grant their owners the right to provide loans to avatars against the value of their virtual items, utilizing a fully automated secure banking system. Owners get to choose their bank’s location in the Entropia Universe and must deposit a minimum of $100,000 (U.S.) working capital to open the banks.

Banks represent an entirely new business model in virtual reality, offering avatars resources and opportunities to flourish financially in Entropia. The auction is historic and sets a precedent for the future of virtual reality.

About NeverDie:

NeverDie has turned a gross profit of $150,000 (U.S.) from his nightclub, Club NeverDie, located on an asteroid in the Entropia Universe that he purchased in 2005 for $100,000 (U.S.). More than 3,000 avatars visit Club NeverDie each month. The primary revenue source results from services provided on the asteroid such as hunting and mining.


Of particular note to me is that he has made $150k gross profit from the asteriod.
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Dino
post May 4 2007, 04:28 PM
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QUOTE (King Buzzo @ May 4 2007, 08:16 AM) *
Of particular note to me is that he has made $150k gross profit from the asteriod.

Allegedly.

Neverdie has been known to lean towards hyperbole on occasion (IMG:http://virtualmindhive.com/forum/style_emoticons/default/lol2.gif)
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Svetlana
post May 4 2007, 04:33 PM
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QUOTE (NEVERDIE Press Release)
NeverDie’s virtual bank will specialize in short-term bridging loans to help finance avatars building virtual manufacturing and construction companies.


I found that the interesting part, perhaps signalling the implementation of a more sophisticated crafting/factory system.


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Dino
post May 4 2007, 06:56 PM
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QUOTE (Svetlana @ May 4 2007, 09:33 AM) *
QUOTE (NEVERDIE Press Release)
NeverDie’s virtual bank will specialize in short-term bridging loans to help finance avatars building virtual manufacturing and construction companies.


I found that the interesting part, perhaps signalling the implementation of a more sophisticated crafting/factory system.

Or at least anticipating.

/attach tin foil hat

Wonder what he knows that we don't know?

/remove hat

Ok, well MA has talked about this for almost as long as cars (IMG:http://virtualmindhive.com/forum/style_emoticons/default/secret.gif)
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Administrator
post May 4 2007, 09:27 PM
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FYI, Svetlana's interview with Jon Jacobs (aka NEVERDIE) about his latest aquisition has been added to the MindArk and Entropian New Forum, here:
NEVERDIE Bank Interview: Sveta Gets Cellular with Jon Jacobs
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