Second Life Currency Crisis?

"The increase in other sinks is related to [the] clean up of some cancelled accounts that had Linden balances," says Zdanowski. "Effectively, these Lindens were already out of circulation, so I would expect no impact to the exchange rate overall."

In addition, Linden Lab has decreased the amount of weekly stipends paid to new users, as reported here. By keeping a lid on volatility through monitoring stipend payments, swings in valuation for the Linden are becoming more controllable. As more and more premium users sign up, the larger the Linden source becomes.

Furthermore, there has been an increase in Linden supply sales through the LindeX. Sales have been spurred by the decrease in stipends paid to new users, forcing those who want to spend money in the so-called metaverse to pony up their own real-world earnings instead of relying on "free money."

Based on current levels, Linden supply sales are set to increase 33% in November from the previous month, and that number could continue to rise throughout the month as more residents join SL and purchase the currency through the LindeX exchange.

In truth, the exchange rate between the Linden and the dollar hasn't fluctuated much yet. The only aberration came on Nov. 1, when the Linden hit a maximum rate of 293 per $1 before retreating to 272.

"The Linden has been trading at a stable rate on increasing volume for the past two months demonstrating the diversity and strength of the Second Life economy," assures Zdanowski.