VIRTUAL HEISTS AND PONZI SCHEMES!
BITCOIN/BLOCKCHAIN IS
NOT THE CUTTING EDGE! No protection… your assets and cash stolen within an hour!
A little while ago, whilst pondering for inspiration for this edition of the ‘Ghost’, my son asked if I’d heard about a huge ‘heist’ and resultant crash of a major corporation. Immediately jolted out of my thoughts, I asked him what he was talking about? He told me a story that set a train of thought that ends…so far… with the seeming lack of knowledge (or interest) of Regulators and tax authorities and why they really, Really, REALLY need to start looking at this expanding phenomenon. If they are (or were) confused by Bitcoin or Blockchain then they’re really going to be out of their depth with this one.
It all starts with Massively Multiplayer Online Gaming (‘MMO’). MMOs are usually huge role playing games with many, many players interacting with each other in a virtual world. They’re games such as the huge League of Legends (67 million monthly users with over 7 million at peak hours) as well as World of Warcraft, Star Wars: The Old Republic and the one I’ll concentrate upon – EVE Online. EVE Online is the one mentioned by my son. It allows players to engage in unscripted economic activity, warfare and even political scheming (more on all that later). It’s also where one of the largest and most expensive gaming battles ever took place – 21 hours with over 7,000 players and the cost in in-game currency of 11 Trillion ISK – or then about USD 300,000 – 330,000 in ‘real’ money. The game had become so large (in 2013 it went over 500,000) that it’s the first game to employ its own ‘real’ life economist.
However, with all its wonders, it has recently led to a story of crime, friendship and betrayal. One of the most powerful groups within the game was called Circle Of Two (CO2). It was run by a Serbian called ‘GigX’ and was ‘betrayed’ by his Australian based Chief Diplomat – ‘The Judge’. In one hour, The Judge
transferred ownership of CO2’s KeepStar (a huge space station) and other assets to rivals Goonswarm and Test Alliance. They evicted all the 4,000 odd CO2 user members from their virtual home and charged them a penalty fee to retrieve their assets. Whilst this was happening, The Judge emptied out CO2’s treasury of about 1.3 Trillion ISK…about USD 13,000 odd in ‘real’ cash value and transferred them to his personal account. As you can imagine, this led to a huge CO2 user row with GigX at one point allegedly threatening to have The Judge’s hands cut off…in ‘real’ life. Eve Online users asked why GigX gave The Judge so much power? Well, the Chief Diplomat attends in on behalf of CO2, in ‘real’ life, a convention held each year in Iceland where game’s leaders discuss the future with the game’s developers (allegedly this was where The Judge was persuaded to switch allegiances).
Now you may think…that’s all very well but it’s not ‘real’ and has no impact on our world. May I share another (short) story that may resonate? In the past, a player called Cally in EVE Online (again…) set up a virtual bank called EVE Intergalactic Bank (‘EIB’) with deposit taking and lending to EVE corporates and individuals with suitable interest rates and repayment schedules, etc… Then one day he turned up, took all the clients deposits – some 790 billion ISK, about USD 170,000 in ‘real’ cash at the time; and did a runner…daring anyone to follow him. He made a video bragging about his exploit and mocking his former virtual bank employees.
If such things had happened in ‘real’ life, then it would have been all over the news and media. Governments would have been asking serious questions of Regulators and the general public would have suitably outraged. However, because it’s virtual and not ‘real’, it doesn’t have the same impact. The general public are probably…much like myself until recently…ignorant
16 | ADMISI - The Ghost In The Machine | November/December 2017
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