Capital Exchange Suspends Activity Until Further Notice Due To Skill Gaming Policy

SL Capital Exchange have announced that are suspending activity until further notice as they await approval on their application to be an approved skill gaming operator. The announcement states :

On July 16, 2014, I filled out the first form for the Skill Gaming Application for Capital Exchange Stock Market Simulation Game. From that point until today, there have been numerous correspondences between me, my law firm, and Linden Lab. As of today we still do not have an official determination, positive or negative, on our application.

I was hoping that because much of the delay has been on the part of Linden Lab, that we would be allowed to operate past the November 1, 2014 deadline set forth in a recent post by Linden Lab. Unfortunately I was informed by Rowan Linden that we cannot. So therefore effective immediately, I am suspending all trading at Capital Exchange until our application is approved or denied by Linden Lab.

I do not know how long this might take, because honestly I thought this would all have been resolved already, however I hear there is a backlog of applications and Linden Lab needs the proper time to review them all thoroughly. So we need to be patient, and wait for Linden Lab’s counsel to do their job.

I’m a bit bemused as to just why CapEx are having such difficulty in getting a reply on approval, I’m also a bit bemused as to why they are seeking approval in the first place but more on that later. CapEx, for those who don’t know, is a fictional stock exchange where Second Life business owners list their business on the stock exchange and the value of shares rise and fall. I’ve engaged with this in the distant past by buying and selling shares and have never had bad experiences with it. I would imagine there have been issues when a Second Life business ceases to be, but I haven’t fell victim to that.

The suspension is due to the Skill Gaming Policy from Linden Lab which had a deadline of November 1st for people to cease activities even if they had an application pending, as explained in a blog post from Linden Lab at the end of September :

Beginning November 1, 2014, the enforcement of our Policy will apply to all Residents, including those with pending Skill Gaming applications that await Linden Lab review and approval. As of that date, any objects or regions found in violation of our Policy will be taken down.We strongly encourage all applicants to submit any outstanding materials for our review as soon as possible so that their applications may be processed before the deadline.

Whereas I have sympathies for both Linden Lab and applicants during this process, as new issues arise during the process, it seems a bit off that a venture that applied as far back as July are still left dangling in the wind in November.

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Skill Gaming Policy Arrives With Sensible Late Twist

The new Skill Gaming Policy officially arrived in Second Life yesterday. However it arrived with an apparent late twist to who is authorised to participate. The last blog post on the subject stated :

If you live in a jurisdiction where skill gaming is permitted and you plan on playing these games in Skill Gaming Regions in Second Life, you should not need to do anything differently. However, adding payment information on file now is a good way to help ensure you’re able to play as soon as Skill Gaming Regions are live.

However it seems that there had either been an omission or Linden Lab decided they needed to be a bit more careful regarding who can participate. On August 29th, after some venues had been approved, a change appears to have been made to the FAQ. The change to the FAQ is a sensible one and one that really should have been mentioned before. The change to the FAQ points out that to participate you must have current payment info on file and you must be 19 years of age or older. On top of this you can’t be connecting from a prohibited state or be a resident of a prohibited state.

The change to requiring current payment info on file is likely to throw those who wanted to go play on their alts, although those who are determined to do so know what needs to be done to allow them to access Skill Gaming Regions.

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LL Issue Reminder And Warning On Skill Gaming Policy

Linden Lab have issued a reminder : New Skill Gaming Policy in Effect September 1, 2014. The blog post also contains a warning that the new policy will be enforced. Skill Gaming in Second Life is basically defined as :

  • A game where the outcome is determined by skill, rather than by chance.
  • Has the option for payment to participate in Linden Dollars.
  • Pays out in Linden Dollars.
  • Is legal according to United States and international law.

That’s pretty much the gist of it, so if the game allows you to pay in with the option of paying out if your skill allows you to win, then it’s a skill game. Now if those criteria aren’t met, say for example you can pay in but there’s a random chance of the game paying out, such as a traditional fruit machine style game, then that’s gambling and is strictly forbidden.

Now if you haven’t been paying attention then you may be wondering how on earth Linden Lab know if the game you play or create meets this criteria. Well that’s what the Skill Gaming Policy is for. Games of skill will only be allowed to be played on approved sims. Only approved games, created by approved creators are permitted and they can only be operated by approved operators. This means that if your game meets the skill gaming definition, you will still be breaching the rules of the new policy if the game, the land or the person operating the game have not been approved.

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Skill Gaming Ventures Start To Get Approval

On August 13th I blogged about the problems both Linden Lab and Skill Gaming applicants had experienced with the application process : Skill Gaming Applications Appear To Be A Skill Game In Their Own Right. In that post I highlighted the moving goalposts of the application process and how they were proving challenging to applicants.

Linden Lab had initially set a deadline of August 1st for this policy, that was later pushed back to September 1st. In my post I felt that September 1st was looking a little problematic, indeed I said :

I’m firmly in the camp that believes that this deadline will need to be pushed back again, but that in itself is no bad thing because we can see that this is a learning curve for Linden Lab and applicants. The important thing to do is to get this right.

Days passed and my opinion did not change, there were no signs on the public wiki of any approved games or operators. However it seems that I was wrong, something I’m not afraid to admit, because approved operators, regions and games have started to rear their heads, as we can see if we look at the public wiki page : Linden Lab Official:Second Life Skill Gaming Approved Participants.

Whereas there are a number of listed Skill Gaming Operators, I’m not sure they are all different people, here’s a current list :

  • MooTownGames SLSGO
  • SushantDiesel SLSGO
  • SushantYing SLSGO
  • SushantLecker SLSGO
  • EchoBlaylock SLSGO
  • PokaMachines SLSGO
  • PIGamesResident SLSGO

At this stage I’m not sure if all Skill Gaming operators will have SLSGO after their name or whether this is indicative of this only really being one applicant. The same applicant certainly appears to have more than one operator licence because the contact email addresses are the same in some cases, or extremely similar in others.

There are a number of listed regions associated with each operator, but again we see some regions listed next to more than one operator.

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Skill Gaming Applications Appear To Be A Skill Game In Their Own Right

The Skill Gaming applications for Second Life seem to be involved in some sort of skill game of themselves as operators try and seek approval for their game. At this stage I wouldn’t be surprised if the deadline is pushed back again because this is turning into a challenging experience for applicants and Linden Lab.

Let’s just rewind a little, Inara Pey recently covered the Second Life Bar Association discussion on the new TOS and the skill gaming policy. I’ve looked at the TOS discussion but not the skill gaming discussion, so let’s take a look at the skill gaming discussion.

The presentation was headed once again byAgenda Faromet. The discussion is a little bit muddied at times due to the fact that gaming and gambling seem to intermingle, but they do get to the differences about gaming and gambling early on :

  • Gambling – betting, wagering something of value, money, on a contest, sporting event, game of chance.
  • Gaming – playing skilled games that require skill or a player’s control of the game.

There are some areas of the discussion that border on being a little bit wrong, for example :

So gachas, breakables, stuff like that? They’re not gambling. I’ve answered so many questions about that. Not affected by the policy because they don’t have a pay-out in Linden dollars. If it doesn’t have a pay-out in Linden dollars, not gambling.

It doesn’t matter what the rick versus reward is, it doesn’t matter that you can sell your rare breakables for a gazillion dollars; they’re not [gambling].

Stock exchange: not gambling. Contest boards … depends on how they’re set-up, but if it costs Linden dollars to play, and it has a pay-out in Linden dollars, it’s gambling. If it doesn’t, not gambling.

The part about not having a pay-out in Linden Dollars meaning it’s not gambling isn’t actually 100% correct. The wagering policy actually states that the pay-out can’t be Linden Dollars or any real world currency or thing of value. The thing of value issue is where people ponder whether certain activities fall foul of the wagering policy, it’s a vague statement. However I suspect it applies to real world things of value, rather than inworld things of value, but I wouldn’t bet on that!

Then there’s a discussion on where attorneys are required to be licensed to practice law :

Comment – If you are from Europe It is rather difficult to hire an attorney who is licensed both in your country and the USA.

Reply – You don’t need an attorney that is licensed in the USA. You need an attorney who can write a letter that says what you are doing is permitted in your country.

However the FAQ does indeed state that the reasoned legal opinion should be provided by an attorney licensed to practice law in the United States. Initially that wasn’t mentioned as a requirement, the goalposts have been moving on these applications.

However it’s interesting that the presentation viewed stock exchanges as not gambling because SL Capex, who bill themselves as the number one stock market simulation in Second Life, are currently in the middle of a skill gaming application and they seem to be having a few difficulties in completing the process.

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