BCX Bank Update | Economy

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BCX Bank Update

Written by Xavier Mohr

Friday, 11 January 2008

From an announcement at the International Stock Exchange:

In both RL & SL in order to make money-bank deposits are invested to make a profit to be returned to investor's via interest payments. Therefore no bank-RL or SL has the funds on hand to allow 100% of all account holders funds to be withdrawn immediately.
Due to the fact that Linden Labs gave us no notice before making their policy public-many folks rushed the ATM's in a panic withdrawing millions & caused us to turn off the ATM's to allow fair distribution & consideration of our options.
Needless to say-liquidating investments in a quick manor is nearly impossible. Loans are out-some for up to a year and those folks aren't in the postion to repay their loan immediately-if they were they wouldn't have needed loans in the first place. Investments in other SL financial entities have either been severely limited or halted due to the recent policy changes or even have dropped in value again due to this recent development. This new policy is already beginning to effect other SL entities and the total effect is still to be determined. We expect to see land prices fall and other things that will result in a true recession within SL. Making liquidation at a worthy value a slow process.

After much consideration & after massive panic withdrawls in the wake of LL's new policy annoucemnt-we have decided NOT to bring our ATM's back online.
Massive withdrawls left us in a position to believe bringing ATM's online creates unfair advantages to folks who are online at the time & near ATM's. Each persons money-regardless of the size is important. Allowing withdrawls in such a manner is unfair & not in the best interest of our customers.
Instead while we examine our next steps we will begin handling avatar to avatar payments. We are working on bringing up our website-to not only post annoucements but get account balances for ourselves. We will then begin accepting notecard requests from account holders with immediate needs. Please note I state immediate. Not every request or amount will be able to be honored immediately and will be limited to a daily amount of $2000L each for the time being. Allowing us time to evaluate the best options and adjustments to be made to progress forward in complying to this new policy while distributing funds fairly.
We believe this is the only fair way to begin distribution while allowing us to be able to consider our next steps and business reorganization.
BCX has always been reliable-never claiming or experiencing attacks, fraud, or other events that have plagued other SL banks. Our system has proven over & over above other SL banks to be reliable & safe. It is not a "box system" but a custom developed system NOT offered or shared with ANY other entity. Other then neccessary upgrades for security & services-we have never limited funds before this new policy. Our CEO & staff have always been & will continue to be accessible to everyone-never hiding behind secertaries or such. We have ALWAYS-since opening our doors-worked for improvements in the financial sector-we have hosted meetings asking the financial sector to begin regulating itself-we have donated time & money to groups trying to form a safe & honest business platform for the financial world. Never have our actions been anything but honest and reliable. This new policy was a curveball that we did not expect & quite frankly even if we did-could not have prevented the inconviences it has caused.
BCX has ongoing income from outstanding loans, sim leases, & several projects in development-including handling the entire financial services for Central Grid-that will continue. We are currently looking at all options for restructuring & moving forward and will continue to do that while we work through this new policy conversion.
Linden Labs did a grave disservice to the virtual community yesterday. Sadly instead of working with the financial sector in putting safe guards in place-they have lumped us altogether with the likes of Ginko-never investigating our business model or speaking to our customers or to our CEO either. We believe however inconvenient this is-that BCX will survive-restructure-and move forward. This will not be overnight-we have many options to consider before making firm decisions on our course. In the meantime we will begin address withdrawls as stated above-exact procedures will be sent to group shortly-including operation times.
Rest assured-as always-BCX staff will be available to answer questions while we work towards the future. As soon as we have access to our data we will send exact instructions on how to submit a withdrawl request.
Thank you to the many of you who have contacted us-offering support & encouragement. You cannot know how much it means to us to know that you do understand that this crisis was not created by BCX itself but by Linden Labs.
Sincerely,
Travis Ristow CEO

Stay tuned to SLReports.net for more information.

Comments

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Yanik Lytton

|2008-01-11 22:47:22

Me,

I don't know about FDIC, but here is Canada, your bank deposit is insured
for up to 60k$. No banks post it anywhere. If you put more in, you are taking
some risks. Wether you know it or not.

At least in SL, you can read
everywhere, form LL to banks or exchanges TOS, from books about Business in SL
to classes on How to make moeny in SL, that investing is risky; banks are risky;
and you may lose everything. Now do I need to sign a disclosure as well? What if
i want to take that risk?

Everyone knows you should be careful when crossing
a street. Some intersections even have signs about it. Should we ban the cars?
LL would.

As for Linden growing up, maybe you are right. They have upgraded
their public relation with 12 yo reps. Bravo!

If you have never put money in
a bank in SL, or never invested in a company via a stock exchange, then why do
you care to post? If you think you can do without a finacial sector in SL, then
good for you. Go on with your chores, and be forever happy.

But please, think
it over before putting all companies, all banks or financial institution in the
same basket. The economy do not run on prim skirts.

SLReports.net User

|2008-01-11 18:03:27

To the above, Virtual Ponzi schemes — pardon, "Banks" can exist for as
long as people are putting their hard earned money into it. It's when they are
called on the bluff that they fail. This can go on for years. Do you believe
that you were treated well by losing 100KL?

If I told you I would give you
2500 percent return on your L if you will let me have it for a couple years
would you do it? If so why? If not why?

Good news articles coming out in the
news. One called cowboy banks, one slashdot article.

This is a blast watching
Linden grow up and be responsible. About time.

Me

SLReports.net User

|2008-01-11 17:51:20

Banks in SL are risky,duh. But I was making some
good money between investing
and banking. JTF was
doing right by it's customers, but LL is not. I'm
going
to lose over 100k lindens. So now instead
of having a 2048m plot of land i'm
getting rid of all but 512m so at least they won't get any tier money from me.

SLReports.net User

|2008-01-11 16:27:12

"If you don't know what you are talking about, at least have
the good sense to keep your trap shut."

I'm a real life business owner. Have been since the
early 90's. I have a background in business and education.
There is no such thing as a bank in SL. None. Like it
or not.

I'm not on a side or the other. No sides. How
anyone could put their L in someone's account in SL is beyond
me. Look at the LL TOS, look at the transaction sheet when
you deposit via your online account.

Banks in RL offer
services to individuals and companies. Why don't you ask your SL
bank to offer
even a single real
banking service?

Furtherm ore, LL is the financial sector
in SL. They are the ones making/backing their L dollars
with end users real bank monies. They run the market. No
one else.

Just the facts...

SLReports.net User

|2008-01-11 16:08:24

@3

Go do a google search on "bank run" before running your
mouth. Obviously if banks just held nothing but cash, they could not pay
interest (whether in RL or SL). Putting it to work requires moving customers
cash into other investments to earn money, which takes time to get out of these
investments (in the case of loans, a long time).

Obviously you have made
the same mistake as the Lindens in assuming all SL banks are scammers.

If
you don't know what you are talking about, at least have the good sense to keep
your trap shut.

Xavier Mohr - Friendly SL Reports Reminder :

|2008-01-11 16:08:21

Couple of things...

First of all, please be respectful with regard to others'
opinions, keep things on topic, no name calling or flaming language. I deal with
a lot of adult language and really don't mind it all that much, but context is
everything and flaming just for the sake of making someone pay attention to you
is a total waste of MySQL space. Henceforth, anything significantly off-topic
that is an obvious attack will be deleted with no notice or warning, and no
announcement.

As far as anonymous commenting, this is a standard Internet
practice that I love. People whose only goal is to inflame a thread hate it, but
those points of view are about worthless to me.

When I was CEO of SLR, I made
a conscious decision to allow anonymous commenting because I think it gives a
better feel for what the community REALLY thinks... since people do not need to
fear repercussions for expressing their opinions.

While changing the
commenting system is no longer a decision over which I have control, I stand by
my original decision to allow user anonymity and would fiercely oppose any
change in the other direction.

Otherw ise, just calm down, keep reading, keep
commenting with respect for both sides... no matter which side you may be
on.

Xavier

SLReports.net User

|2008-01-11 16:00:48

The only person I see that is actually being honest in this issue is JTF. He is
honoring RL USD withdrawls and updating everyone on the situations and exactly
how much money he has and doesn't have.

Every other bank inside SL is popping
up these insane plans about how this dont apply to them or how they are going to
get some sort of affiliation that creates a loophole or whatever... all of them
are completely unbelievable and just lieing to themselves... and none of them
are honoring withdrawals in any substantial way that I know of.

Ann Otoole

|2008-01-11 15:54:20

at least i, even though i have none irl, have the balls to use my real sl name
to make my comments. if this website wants to show some credibility in the face
of this nigerian scam shutdown they will require people to use real sl names for
comments. comments by people afraid to say who they are must be from scared
little kids who need to get off their mom's puter and get back to kindergarden.

SLReports.net User

|2008-01-11 15:46:11

"Linden Labs did a grave disservice to the
virtual community yesterday."

No they didn't. They told you to pay back whom you
are scamming from. Period. Quit with your financial sector
mumbo jumbo. You need an education in
RL business.

Everyth ing you write shows that you do
not understand real life business.

Banks can pay people
back. Period, and if not, it's insured by the FDIC in the US.
You offer no services, you offer nothing. No one wants to
hear your rambling. Go down to the "real" bank, get
the money, and pay people back. I could do that within
a day.
One day. That is all it takes. You either have it, or
you don't. If you cannot pay back those you ripped off, you
are a scammer. Period.

Get an education and
offer something positive to the Second Life community.
Quit leading people on.
Either pay them back immediately
or close your doors and quit messing with people. All
this non-sense about not being able to pay back like real
banks is horse garbage.

Me

SLReports.net User

|2008-01-11 15:30:32

Ann Otoole wrote:

the effect of halting this "activity" will be negligible.

Ann, just bcz you didn't agree with the activity doesn't mean
others didn't do this. WSE claims to have 22000 users, JTF
claims over 10000. I fail to see your credibility in
this issue as well. i have never once seen your name
around this site until the banking ban, and a google search
of your name only brings up comments where you are bitching
about other random shit. do you just enjoy making yourself
look important in the midst of others misery?

Ann Otoole

|2008-01-11 15:14:16

loans to who? alts? friends? right.
recession? no. the percentage of the sl
population foolish enough to have engaged in this form of gambling is tiny and
the effect of halting this "activity" will be negligible.

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