Do L$ have value or NOT??????

I feel so special

From Webster's New Collegiate Dictionary, published 1977 by G & C Merriam Co.

Security: 2a) Something given, deposited or pledged to make certain the fulfillment of an obligation.

I've edited out the stuff about 'feeling secure' etc.

By this definition, LL has not issued the L$ as a form of 'security.' They do not, nor have they ever claimed to back the L$, in that we could never walk up to LL and demand recompense for the L$ held in our accounts. The L$ is not secure in that it was never given to us in an understanding of an obligation to fulfill. It was given to us in order to exchange for goods and services; if WE CHOOSE to see it as an obligation for services rendered in THIS GAME, that is OUR choice. It is not backed by any institution, corporation, or government authority.

To claim that LL is enabling the trading of securities would be a misleading claim, as they are not issuing or dealing with securities in the first place.

I'm not sure we can get a good definition of what a security is in legal terms, from the dictionary, but it seems to be in the ballpark.

You are correct LL does not claim to "back" the $L in terms of giving you any money for it and never has. In fact their TOS specifically states this. However, today they updated their blog to discuss the SL economy. They contradict their TOS again by actually stating the $L does have value and can be traded for real world currency.

One other thing they mention about the $L in their TOS is that they do not actually give it to you and they retain ownership of the $L. They just give you a limited license to use it whether you trade it as an in-world currency, or for USD.

Since they continue to contradict themselves about the USD value of $L, that would either have to be determined in the Courtsl, or LL might even just stipulate it has value. Who knows. At the moment they say that it does and that it does not have value. I don't think it would be difficult to prove however that it does indeed have USD value.

As for it being backed by LL as an in-world currency, I don't think there is any question that it is. LL created it to be used as an in-world currency and continues to issue it for the sole purpose of regulating the SL economy. They just don't guarantee any value or demand for it. But the purpose is definitely distinguishable in-world.

It's quite another thing in RL though. Just the $L alone in your hands is not worth anything unless you can trade it to someone who wants to give you something for it and in fact you don't even own it but basically purchased a limited license to use it. By that definition LL owns it, but can they revoke it at will without consequence, if it cost you USD. It may not matter, but I think there is also an implicit obligation to fulfill it.

Then finally, if you place a sell order then LL in a sense guarantees the value of $L can be traded on the LindeX for USD at a specific rate. The guarantee is implied only and not stated.

So many things would completely depend upon the interpretation of the law in a court that it's impossible to speculate on which side of the fence it would fall. You make a good point though.

The thing about TOS is they are never worded quite well enough. There was a recent case styled Bragg vs Linden Labs. Not sure, I would have to look it up again. But in that case the TOS was actually thrown out. Basically the TOS said they didn't have to give a notice and could change the policy at will. The Court disagreed that it was unreasonable or something to that effect and they were obligated to give notice.

Anyway that doesn't particularly apply here, but it's just an example that no matter what LL states in their TOS, it is not carved in stone.

Then it is not a security.



Then it is not a security.



Then it is not a security.



1) No it doesn't guarantee that the L$ will trade at a specific rate. LL helps to stabilize the rate by releasing or pulling in sinks from the economy. It in no way guarantees that you will receive ANYthing for your L$.

2)"implied only and not stated"... Then the L$ is not a security.



Then the L$ is not a security.

What you've written here has no relationship to what you quoted for me. I never said internet gambling was illegal.

This does not describe Lindens in any way.

The TOS never says that L$ have no value. I don't understand why people keep repeating this myth.

It is neither implied nor stated. I can't imagine what makes you think it is.

They will list rates for outstanding orders. That just says those orders exist. It doesn't guarantee that they'll exist tomorrow. It doesn't guarantee that those orders won't be cancelled or executed before you can place your buy order. It doesn't guarantee anything about the ability to get a specific rate.

At most it guarantees that if you place an order at a specific rate, it won't be filled unless it can be filled at that rate or better. There's a million L$ offered for sale at 250L$/USD. It's unlikely those orders will be filled anythime in the foreseeable future, if ever.

Where is the contradiction?

$L can be traded for real currency. But LL does not guarantee this or back it themselves.


No contradiction.

The TOS wasn't thrown out. The specific provision requiring arbitration was. I don't recall anything saying that they were obligated to give notice, but it might have said that the lack of notice was a factor in determining that the arbitration clause was invalid.