Linden Lab’s New ToS, the Bank Secrecy Act, and You

Today, Linden Lab updated its Terms of Service. The updated Terms of Service “make it clear that trading of Linden dollars (L$) on exchanges other than the LindeX, Second Life’s official L$ exchange, is not authorized or allowed.” This change has a lot of people concerned, because many of those third party exchangers are popular.

Why has LL made this change, and what does it mean to you?

Here’s why LL has (probably) made the change: FinCEN changed stuff first.

In March, the Financial Crimes Enforcement Network (FinCEN), the federal agency charged with enforcing the nation’s laws against money laundering, issued new regulatory guidelines regarding virtual currencies. This new guideline applies the Bank Secrecy Act to virtual currencies and businesses that administrate and exchange virtual currencies.

The Bank Secrecy Act contains numerous anti-money laundering and anti-fraud provisions. These provisions place certain requirements on “Money Services Businesses” (MSBs) and money transmitters, including registration requirements; requirements to collect information on any potentially suspicions transactions and keep extensive records on users; and requirements to report suspicious transactions to the federal government. A regulatory change applying the Bank Secrecy Act to virtual currencies, as FinCEN’s did, has some significant effects on any business relying on virtual currencies.

Let’s take a closer look. What did this change do?

First, FinCEN had to define who was and was not subject to the regulations. FinCEN acknowledged that there were “users,” “exchangers,” and “administrators” of virtual currencies. Users are people who obtain virtual currency, and are not MSBs: they are not subject to the registration, reporting, and recordkeeping regulations. However, exchangers (who have the ability to exchange virtual currency for real currency) and administrators (who have the ability to issue or withdraw virtual currency) are MSBs. They are subject to strict regulation.

Next, FinCEN had to sort out different kinds of exchangers and administrators. It identified three: those who trade in e-currencies and e-precious metals; centralized virtual currencies; and decentralized virtual currencies. Let’s look at the last two, because those affect Linden Lab.

A centralized convertible virtual currency, as defined by FinCEN, is a virtual currency “banked” in a centralized repository, controlled by a centralized administrator. Any exchanger of currency provides its services through access granted by the administrator. A clear example of a centralized virtual currency is Facebook’s virtual money.

A decentralized convertible virtual currency has no central repository and no single administrator. Users may obtain it through their own computing or manufacturing effort. Users who create or obtain that virtual currency and transmit it to other users in exchange for real currency, funds, or different forms of virtual currency are acting as exchangers, and are subject to regulation. Bitcoin is a clear example of a decentralized virtual currency.

Okay. And it applies to Linden Lab how?

Now things are a little more clear. As of this past March, Linden Lab is an MSB, regulated by FinCEN under the Bank Secrecy Act. It is subject to some strict reporting, registration, and recordkeeping requirements. Linden Lab is an administrator and an exchanger of a centralized convertible virtual currency.

Have you been following along? Because here’s the payoff: Because of the very strict reporting, registration, and recordkeeping requirements placed on LL by the Bank Secrecy Act, LL has to distance itself from any exchangers it does not control. Those exchangers might not be paying attention to the new FinCEN laws. They might not be keeping records. They might not be reporting suspicious transactions. They might be permitting money laundering. LL has to make it very, very clear that those exchangers aren’t authorized; they’re not part of LL; and LL isn’t responsible for them.

So what does this mean to you?

That depends.

It may mean nothing at all. The third party exchangers may truck right along and be just fine. They may comply with the new regulations and continue forward. They may fail to comply and skate along without anyone noticing. BUT. They may fail to comply and get shut down and have all their assets seized. I don’t know.

Third party exchangers have always been a “use at your own risk” proposition. However, now the federal government is actively cracking down on administrators and exchangers of virtual currencies. It looks like Linden Lab is taking steps to make sure it’s in compliance. I don’t know if the others are.

So…you know. Use at your own risk. Really.

EDIT: Apparently, Linden Lab’s support team is telling people that LL is interpreting “not authorized” to mean “not permitted” rather than “not accredited.” I really wish LL would clarify this, because Section 5.3 of the Second Life Terms of Service pretty clearly states that other exchanges exist and that people exchange money there, and it only states that such transactions are “not authorized.” I draft terms of service pretty regularly, you guys, and if they’re intending “not authorized” in this section to mean “grounds for termination,” that’s some sloppy contract drafting. LL, you need to fix this. In the meantime, I strongly suggest that SL users stick to the Lindex exchange.

May 8: One last comment. First, Inara Pey drew my attention to a post she wrote in April about this very issue. It’s well-written and worth a look. Now, it may be that Linden Lab is doing something completely different, like just trying to get more revenue off Linden sales, or just trying to consolidate its control over the Linden dollar. These regulatory changes do affect LL, though, and it’s more likely than not that LL had to respond to them and chose to do it this way.

Regardless, I think LL has some big problems to deal with related to this move. As I see it, they announced this change yesterday, required users to re-establish agreement to the new Terms of Service yesterday, and implemented the changes yesterday (including revoking the third-party exchangers’ access to certain APIs that they needed to function). But as per LL’s own Terms of Service, material changes to the ToS aren’t effective until 30 days after users receive notice…and this is absolutely a material change. And that’s a problem. I’m not sure who’s sailing the ship right now, but they need to get it tightened down.

So bloody your hands on the cactus tree

I’m slow to post these days, but I promise I’m working on it. I’ll never be a daily blogger, but I do really like taking pictures and writing when I can.

For now, dig it: loads of new stuff! First, oh my god, these boots. Ju Weissnicht of Ju (formerly of Treads…you know, she made the K Boots that everyone lived in for years) doesn’t release new shoes often, but when she does, her work is so worth it, especially now that she’s moved to working in mesh. These boots are beautifully crafted and textured, and here’s what I like best about them: they’re mid-calf, and she’s not only made them in the normal standard sizes, she’s made them in three calf widths. This is good for two reasons: first, this means they’ll fit more body shapes, and I’m always happy to see mesh designers offering more options that make room for different body shapes; and second, see the picture. If you’re wearing pants that come over the boots, just wear the smallest calf option, and it (probably) won’t poke through your pant leg. Nice, huh? The fatpack also comes with an easy HUD for changing colors, so you don’t have to stuff your inventory with tons of objects.

Anouk and Elie Spot of mon tissu keep putting out really, really high-quality casual classics in mesh — the kind of clothes that just look like what you’d like to wear on a summer Saturday. Whether you’re into light, soft sundresses or cute shorts or slouchy sweatshirts, mon tissu nails it perfectly. I tried on these khakis and just fell in love with the demo: they just look so soft, so weathered, just perfectly loose and comfortable. I’m not much of a khaki wearer in real life, but I just love how comfy and easy these look. Going to live in them for a while.

While I was putting this outfit together, I started looking for a belt to go with it. Side note: why are mesh belts so rare? WTF, designers! We need belts! Unrigged. Not just a template. My search led me to Connors, which was a good thing, though — I used to shop at Connors regularly, but Salah Axel was very slow to respond to mesh, so I stopped checking in. Salah has joined the mesh world quite nicely now: she’s creating some excellent items. The belt and the poncho are both from Connors, and I’m a huge fan of both.

The last thing I’ll mention, because it’s really cool, is the tattoo from Vestigium (which you can barely see in this picture…I’ll try to do a better one later). Arm tattoos in SL are frustrating, because (due to the way the avatar mesh is made) anything you do on one arm has to appear on the other arm, and who does symmetrical arm tattoos in real life like that? Lu Scorpio has started offering mesh arm tattoos, thus allowing single-arm tattoos. Go check it out. It’s worth getting.

Wearing:
Skin: Tableau Vivant
Hair: Exile — Revolver by Kevar Cleanslate
Poncho: Connors — Knit Cape by Salah Axel
Trousers: mon tissue — Cotton Pants by Anouk Spot
Boots: Ju — 91 boots by Ju Weissnicht
Belt: Connors — Leather Belt by Salah Axel
Glasses: Kumaki Glasses Style — Domino by Koguma Kumaki
Necklace: ISON — Stark Dagger Necklace by Harry Hyx
Tattoo: Vestigium — Lady Muerta by Lu Scorpio
Hands: Slink — Mesh hands by Siddean Munro
Pose: Apple Spice by applespicestore

Formal.

I may have a new favorite article of SL clothing. This isn’t the world’s clearest picture of it, but never fear: you’ll see it again. This tuxedo jacket from Coco is gorgeous and perfect and beautiful: the texture has a luxurious, slightly satin sheen to it; it hangs flawlessly on my shape, and the mesh is excellently crafted; and even better, it is not unnaturally fitted, so you don’t look like a Barbie doll when wearing it. It hangs as a jacket would hang. (Men, I do not know if it would fit you, but there’s a better chance of it fitting than most women’s mesh).

Also, these new trousers from Elate! are really nice. The texturing on them is very well done. I wish the cuffs weren’t quite as straight, but that’s a minor quibble. It’s not like anyone else makes trouser cuffs that break properly over the shoe…but my god, that’d be a nice touch. Someone make it happen!

Wearing:
Skin: Tableau Vivant, as usual
Hair: Atro Patena — Ronald by Mechul Actor
Jacket: *COCO* — TuxedoJacket by Cocoro Lemon
Shirt: *COCO* — SkinnyTie&Shirt by Cocoro Lemon
Trousers: Elate! — Elle Jeans by Kellie Iwish (available at C88)
Shoes: monso — My Leather Oxford by Morphine Janick
Hands: Slink — Mesh Hands by Siddean Munro
Sunglasses: Kumaki Glasses Style — Domino 1.00 by Koguma Kumaki (available at Men’s Department)
Pose: Di’s Opera by Di Hoorenbeek

I am the abstract

Let’s be honest: most of SL fashion is limited to the Ken and Barbie wardrobe staples. It’s geared towards casual, everyday wear, and when it dresses up, it only reaches to pretty gowns and suits. There’s not a lot of avant garde, envelope-pushing fashion, because it’s hard to make and the market is small. But there are a wonderful few artists in SL really going for the outré and the unusual.

For Miamai’s BlackLabel collection, Monica Outlander makes some very exciting, unusual, avant-garde work. She’s really concentrating on the silhouette of her pieces: strange angles, enhanced curves, playing with masculine and feminine and hinting at fantasy shapes. She offers jackets for men and women that suggest suits of armor, with tiny insect wings drooping off the back; whimsical tutu skirts with winged legs; boots that trap butterflies; horned hoods and elegant leather opera gloves with fins and talons; and this demonic bodysuit, with its legs that hint at a satyr’s and its horned breasts.

It’s fashion like this that reminds me that SL really is a fantasy world, and makes me so enjoy pushing the bounds of what I can do and be in it.

Wearing:
Skin: Tableau Vivant as usual
Hair: Exile — Revolver by Kevar Cleanslate
Everything else: Miamai — Antara by Monica Outlander
Pose: Di’s Opera by Di Hoorenbeek

Let me show you a few things

Suits. How much do I talk about the need for good women’s businesswear in SL? A lot. Yes, I know, you’re all tired of it…but you’re not all tired of seeing me in suits, so I’m gonna keep going. A friend of mine pointed me at Mutresse the other day. It’s a brand new store with not much in it yet, but Eeky Cioc is making suits, and they’re perfect. They come in a snillion colors, the texturing is gorgeous (seriously, so gorgeous I even bought the pink one for my alt…pink, you guys, because it’s such a light, shimmery color it made me giddy), the weighting hangs beautifully, and the fit is excellent. From what I am told, they’re all original mesh, and the work is really, really good. I wish I’d fatpacked while they were on sale. Go. Suit up. You won’t regret it.

In other news, bloggers have been all over the study Froukje Hoorenbeek released last week for Dutchie, and rightly so. It’s absolutely beautiful work. But let’s be honest, we bloggers like to get our naughty on, and I wanted to show that the Dutchie study isn’t just about the Adult version. The PG version of the chairs look just the same, yes, but that’s not what makes them exceptional. First, they’re actually business-appropriate. There are no animations here that would be unacceptable in your office or home — no cuddles or make-outs. There are some very nice wine- and coffee-drinking poses (the chairs dispense objects), but the chairs are perfectly work-safe. Even better, they resize and the animations still work. If the chair is too big, scale it down some and you’ll still be able to use it.

As long as I got my suit and tie….

Wearing:
On Vaki:
Skin: Tableau Vivant, as usual
Hair: Exile — Revolver by Kevar Cleanslate
Hair base: AITUI — Etched Hair Base – Monumentum by Jesseaitui Petion
Suit: Mutresse — Simona Trousers and Jacket by Eeky Cioc
Bra: Maitreya Bra Top by Onyx LeShelle
Shoes: monso — My Leather Oxford by Morphine Janick
Hands: Slink — Mesh Hands by Siddean Munro

On Ismene:

Skin: Glam Affair — Cassiopea by Aida Ewing
Hair: TRUTH — Devina by Truth Hawks
Dress: coldLogic — manza by coldlogic
Shoes: G.Field — Flower Pumps by Cerberus Noel
Jewelry: League — Wanderer -Oak- by Nena Janus

Poses:
DARE by Chance Greatrex; Long Awkward Pose by Dove Swanson (retired)

Furniture:
Dutchie study by Froukje Hoorenbeek; PILOT by Kaz Nayar, POST by Van Auster

Fair Use on the Internet

We talk a lot about fair use. What is it, really? What is the use that is fair? There are a lot of things that many people don’t understand about fair use. There are a lot of things that many people assume — correctly, incorrectly, or only partially correctly — about fair use. And it only gets more complex when you add in how fair use works on the internet, because fair use is so integral to the internet as we know it.

Come to Justitia on Saturday, January 26, at 10 am SLT to hear Tim Faith, a Maryland attorney specializing in technology and intellectual property, and me (as my alt, Agenda Faromet) discuss how fair use works, how it affects the internet, and common misconceptions about fair use.

Morning coffee on my patio

I have a lot of friends who make furniture. Just as I am really entranced by good poses in SL, I am also absolutely enthralled by really well-done furniture, and I spend the majority of my SL budget on both furniture and on a nice plot of land to keep a house where I can show off my furniture. Having once (briefly and embarrassingly) tried to enter the SL furniture-making market, I have a great appreciation for those who create the pieces of art that give our virtual lives a realistic background and allow us to build the world around us the way our minds’ eye says it should be.

Buckle up, my freaky darlings. This post is gonna get spammy.

A while ago, when I first built my new house, I swore I’d take pictures of it eventually. And I meant to! But it’s never really been done, you know. I keep decorating. I keep finding new and awesome pieces to add to it. But my landlord, Alicia Chenaux (who is awesome, by the way), set up the sim for winter, and it just looks so nice for pictures. So here you go.

The house is mine. The stuff in it, which is really the heart of the place, is the work of amazingly talented furniture designers. Let’s take a look.

My dining table and chairs are by Trace Osterham of Theosophy. Trace isn’t still in SL, and that’s a damn shame, because his work was exceptional, and still holds up even with the proliferation of mesh. Beyond it, the rolling bar and the wingback chairs are by Kaz Nayar of PILOT. The chairs aren’t available anymore. For someone relatively new to mesh, Kaz is doing really impressive work, and most of his work is right in my modern/industrial chic style.

You can sort of see the patio in this picture, but you can see it better if you scroll up to the first picture. That set is from Cory Edo of Trompe L’oeil, and Cory’s work is so beautiful it’s not even funny. The plants are from mainstays like Botanical and Arctic Greenhouse, as well as newer stores like floorplan and Apple Fall.

Ah, POST. I have loved Van Auster’s work for years, and mesh just seems to have rejuvenated him. I have so much POST furniture I can’t fit it all in my little house. It’s gorgeous, perfectly crafted, and meticulous in its details: poses that just suit the set, texture changes that make sense, sets that hand out beautiful martinis or absinthe.

Scattered around the living room are pieces from Cheeky Pea (the beautiful birdcage), Apple Fall (the globe and boxes), PILOT (the table and lamp), Art Dummy (the doll), Little Boxes (the picture frames), and Painted Lily (the artwork).

In the bedroom, the first thing to mention is the bed, by Gala Charron of Art Dummy. She also did the beautiful doll with the lantern in the living room. Art Dummy offers really creative, whimsical, artistic furniture that works well as conversation pieces.

I also want to mention the screen by Ravyn Hynes of MudHoney. The screen isn’t much, but the fact that it’s from MudHoney is: I couldn’t take pictures of everything in my house, and I have a lot of MudHoney. You should see the bathroom. Ravyn makes beautiful, practical furniture, and I would be remiss to do a furniture post without mentioning her. The same goes for Dutchie Hoorenbeek of Dutchie: again, if I’d taken pictures of the bathroom or kitchen, I’d show a ton of Dutchie’s pieces. It wouldn’t be a furniture post without mentioning them.

I’ve left a lot of people out. I’m sorry. There were only so many things I could take pictures of, and only so many pieces I could specifically mention in a post that’s already really long. But seriously, thank you thank you thank you, furniture designers. Without you, I’d be living in a very boring prim.

Wearing:
Skin: Tableau Vivant
Hair: Exile — Revolver by Kevar Cleanslate
Jacket: coldLogic — Meek by coldLogic
Jeans: coldLogic — Cuoco by coldLogic
Glasses: Entente — Savant by Entente
Shoes: Monso — My Leather Oxford by Morphine Janick
Socks: Pig — Argyle Sock (Uncle Harry) by Apatia Hammerer
Pose: Oh! Studio by Marcopol Oh

Furniture and Decor: Apple Fall by warehousefifteendesigns, Arctic Greenhouse by Logan Bauer, Art Dummy by Gala Charron, Barcode by Makenzie Irling, Botanical by Kriss Lehmann, Cheeky Pea by Isla Galeach, Conspiracy Theory by Ewan Mureaux, DIGS by Iris Maskelyne, Dutchie by Dutchie Hoorenbeek, floorplan by Tegan Serin, Little Boxes by Sesi Ackland, MESHWORX by loz hyde, MudHoney by Ravyn Hynes, nordari by Jordan Giant, North West by Lili Brink, Ohmai! by Anya Ohmai, Painted Lily by Belochka Shostakovich, PILOT by Kaz Nayar, POST by Van Auster, Shop Seu by Seu Ahn, Theosophy by Trace Osterham, Trompe L’oeil by Cory Edo

Check and mate

A friend of mine reminded me, yesterday, that feminine doesn’t mean anti-feminist. It’s something I have never doubted, of course, but it’s good to be reminded of: women in frills and bows and pretty dresses can be powerful, strong, and assertive, too. A woman’s ability does not derive from her style of dress or demeanor. She may be girly to the core and still run rings around any idiot that makes the mistake of crossing her, as so many of my beautifully girly — but amazingly brilliant — friends can attest. Moreover, a woman may enjoy or appreciate things that are traditionally feminine, but not be defined by those things. We are more than just our shoes and our shopping, just as our more masculine friends are more than just their porn.

Iris, this one’s for you, and for all of my other brilliant, fierce, powerful, accomplished, battle-hardened, amazing, hilarious, wonderful, insane, generous, creative, inspiring girly-girl friends out there. I am awestruck by all the things you do, and I have a Jenna Marbles-sized girl-crush on every last one of you.

Wearing:
Skin: Tableau Vivant, as usual
Hair: Wasabi Pills — Skye by MissAllSunday Lemon
Dress: Ladies Who Lunch — Street Minidress by Faint Paulse
Collar: Glam Affair — Vanity Collar by Aida Ewing
Claws: Amorous — Lacerated by Matchbook Monday
Boots: Gos — Urban Boot by Gospel Voom
Tattoo: Vestigium — Mermaid’s Enchantment by Lu Scorpio
Poses: oOo Studio by Olaenka Chesnokov; Del May by Del May

Pile on!

I know, I know, everybody’s already done their OMG IT IS AUTUMN pics. But where I live, the leaves aren’t in any hurry to change color, and it kind of stays a nice moderate temperature until very late in the year — hell, it’s still shorts weather today. But autumn makes me miss real seasons — I miss the crunch of leaves, of diving into big leaf piles and tossing someone else’s hard work all over their lawn, of branches and twigs poking into my hair and arms. I miss the smell of it, the snap to the air, the skeletal trees.

It’s a virtual world. I could have a few hours of virtual fall.

I’m so happy risey Arai of Sey is doing mesh now. This sweater has been all over the feeds lately, and for good reason. When you get it, you get SO MANY OPTIONS, you guys. First: it’s unisex, so you get (standard) sizes for men and women. Second: you get it with and without the undershirt. Third: you get a HUD that textures / patterns each layer, as well as adds patterns to the suspenders, and the suspenders on the undershirt are independent from the suspenders on the overshirt. Fourth: each layer (except the suspenders) can be tinted to your desire. Fifth: it looks like you get even more stuff if you fatpack, but I didn’t, so I can’t be certain. Sixth, and this is really just a bonus for me: it’s got such a great shape. Not all mega-boob-y. God, I love this sweater.

Dear risey Arai: Y U NO MAKE MOAR UNISEX. I used to be able to wear Sey’s menswear a lot, before mesh. risey’s putting out some gorgeous mesh work, but almost all of it is rigged for men and doesn’t work for women. THIS IS MY SAD FACE.

As a side note, yesterday someone asked people to list their favorite hair stores in SL. It really made me realize how few hair stores are putting out men’s / short hairs now. Burley and Exile are doing men’s mesh styles (but at Exile, they’re few and far between). Dura and Atro Patena are doing excellent non-mesh styles. There are a few smaller shops putting out some good hairs, but since mesh made long hair so exciting, hair designers have pretty much abandoned short hair. That’s really, really unfortunate.

However, the upside: the few designers that are doing short styles are kicking some ass at it. Mechul Actor of Atro Patena is only getting better as he gets into his niche, for instance, and Atro Patena is rapidly becoming my go-to hair. If you haven’t checked it out, you should.

Wearing:
Skin: Tableau Vivant, as usual
Hair: Atro Patena — Noah by Mechul Actor
Hairbase: VCD, as usual
Sweater: SEY — Cut-off Ensemble by risey Arai
Jeans: coldLogic — Cuoco jeans by ColdLogic
Boots: Gos — Desert boots by Gospel Voom
Poses: [H+L] by Hani Cheng; D.Luxx Poses by Reo Blinker

Nothing to be afraid of

Halloween is coming up fast. Can’t wait, really — like so many people who grew up with a little too much imagination and not quite enough adventure between the bus stop and the school doors, I love Halloween. I’m really looking forward to seeing what the SL world’s creators do with Halloween this year. Last year, Halloween came upon us so soon after mesh was released, there just wasn’t the infrastructure or uptake in place to really have significant mesh Halloween costumes and accoutrements. This year, though…

Oh, no, I’m not all Halloween’ed up in these pictures. Not yet. But I’m getting in the mood. I’m skulking around creepy asylums, er…tending to…the tormented souls still interned there, maintaining the strictest order. Surely there’s nothing to fear here, right?

Least of all me…

Wearing:
On Vaki:
Skin: Tableau Vivant, as usual
Hair: Dura — 31 by chiaki xue
Suit Jacket: Bare Rose — Slim White Lady by June Dion
Trousers: The Sea Hole — silk dupioni Beachcombers by Drinkinstein Sorbet
Shoes: hoorenbeek — Allen 2.0 by Limer Fredriksson

On Ismene:
Skin: Glam Affair — Roza 07 by Aida Ewing
Hair: LeLutka — Oscar by Thora Charron
Shirt: coldLogic — Castillo by coldLogic
Feet: Slink — Medium Height Mesh Feet by Siddean Munro

Poses: Long Awkward Pose by Dove Swanson, oOo Studio by Olaenka Chesnokov