bitterisk (OP)
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March 13, 2014, 08:16:17 AM |
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Hi everyone,
First-time poster here, but a long-time lurker and BTC enthusiast. I would like to hear others' thoughts, criticisms and input on what I'm about to outline. I know there are many here who have a better idea of the mechanics that such an idea would require/entail, so that's mainly my objective here: to start a discussion, if it is in fact viable. It's a bit long, so apologies in advance.
As of late, I've become interested in new ways that Bitcoin commerce can be facilitated in a variety of niches that currently are either under-served or in which its presence is completely void. It seems that the more areas in which Bitcoin commerce becomes commonplace, the more rapidly the adoption of Bitcoin will occur by the masses. Perhaps some disagree, but that seems like the long-term key to sustainability and in the short-term, those juicy bubbles that some enjoy. One idea that just won't leave me alone is the idea of a platform of sorts that can facilitate trade between BTC and the in-game currency of EVE Online (ISK).
Why EVE specifically? There seems to be a fair amount of overlap between those who enjoy EVE and those who use BTC. It seems as if there is even more cross-adoption between these two than there is between BTC and MMORPGs in general.
I've seen the occasional posting from an EVE player on here and other forums who wants to trade his or her ISK for BTC. Usually, these postings only last a short while before the user runs out of ISK to sell, and the listing/thread is spent. This implies that there is some demand for the pair, but to my knowledge, there is no consistent trading service that allows users to trade between these two currencies.
Exchanges like VirWox are excellent examples of markets in this industry that can be highly successful, but EVE ISK doesn't necessarily have the same malleability as SLL. When you add to the fact that RMT (Real Money Trading) via EVE Online currency is against game policy (and the fact that services like PayPal aren't going to let a new entity get away with the same things that VirWox does these days), the dynamic becomes quite different.
Thinking about how ISK & BTC can be traded given the limitations of ISK, these were some points I considered for the creation of a pretty simple trading service:
1. No acceptance of fiat in such a service seems ideal, at least in the short-term; it only complicates matters vis a vis record keeping/accounting, and could result in regulatory issues, depending. It also dramatically increases the need for additional security measures.
2. Buyers and sellers – particularly buyers of ISK - would need incentive to part with their BTC in exchange for ISK. Someone such as myself wouldn't need much coercion, but I can sympathize with the viewpoints of other EVE players who hold BTC. The most straightforward way seems to be to provide better prices on ISK for both buyers and sellers. The margin between what an average EVE player can sell his or her ISK for to a reseller and what that reseller sells ISK for to the general public is massive; fixed prices can be established that substantially reduce costs to ISK buyers and boost earnings for ISK sellers. The notion of not providing your financial information to a reseller of in-game currency – most of which are based in countries where you may not feel comfortable transmitting any financial information – would reinforce this narrative.
3. Buy/sell prices of ISK could be fixed in order to make it as simple/secure as possible. It doesn't seem like the type of exchanges people are used to when it comes to cryptocurrency trading would be the best path for purchasing or selling ISK with BTC, for a number of reasons. The most important ones, however, relate to the amount of labor and finances that go into building a custom exchange, and the fact that any large reserves of customers' currencies on-hand will make the platform an automatic target for undesirables (which is addressed directly below). With this being a relatively niche concept, I'm not convinced that a huge expenditure of time or money could be justified to create it, either. A very simple trading service could be constructed with fixed prices that pair buyers and sellers in the order that their orders were placed.
4. The service could choose to only hold funds in an escrow-like fashion. Rather than having users deposit their ISK in-game with an corporation linked to the service and then crediting users with ISK on an exchange (and likewise/obviously, holding BTC at the same time), it makes more sense to act as a simple intermediary in the transaction with the BTC. Once a ISK buyer and ISK seller are matched, the buyer then transmits BTC to an address associated with the trading service. EVE Online API keys can be configured to provide the necessary in-game confirmations from buyer/seller, which then would result in the BTC being transferred from the trading service address to the ISK seller.
5. Only one denomination (or perhaps a few) of ISK could be offered. All of the aforementioned elements make this sound more like a store than an exchange, and I suppose this element would reinforce that premise. Especially in the beginning, small amounts of ISK (in denominations of 1 billion, 2 billion, etc) would be offered to streamline the matching of buyers and sellers. It would also discourage larger/career ISK sellers from saturating the trading service. By keeping trade between more casual ISK buyers and sellers, the likelihood of RMT detection by EVE Online/CCP would be markedly decreased.
6. A balance of anonymity, security and reliability. With all of the above considered, the necessary details from users and the responsibilities on behalf of the service itself would make these transactions relatively anonymous, hands-off and secure, and conceivably, the described nature of this trading service could serve as a deterrent to various attacks. Users would only need to provide an email address, a BTC address to indicate where the BTC originated or is to be sent after completion, as well as limited API information from EVE that provides access for in-game transaction verification. Because none of this information is sensitive when handled properly and because the only BTC in the hands of the trading service at any given time are the amounts of pending transactions, there is very little incentive for individuals to attack the service for a few lousy API keys to a game or a small amount of BTC. In addition to this, the trading service wouldn't be in possession of any ISK at any time, which means no surprise in-game suspensions and loss of users' ISK.
And of course, some drawbacks:
1. It would most likely take longer to purchase ISK via a BTC trading service than through a traditional reseller. With a simple trading service, the overall process would be subjected to the whims of three entities: the buyer, the seller and the trading service. If you are pairing users on a first-come, first-serve basis, then the buyer of ISK has to act in order to initiate the process. Once the BTC are confirmed as deposited with the trading service, the buyer will then be given a series of steps to complete in-game, followed by the seller responding accordingly. There are multiple points at which either the buyer or seller could be asleep, AFK, or simply decide not to follow-through with the transaction. I recall one instance where my ISK purchase via credit card never came through and it took a week to get a refund, so even the current solution isn't exactly always speedy.
2. The pairing of buyers and sellers - particularly in the beginning - could prove to be difficult. This is perhaps the biggest reason why pre-defined amounts of ISK would be needed, as a buyer and seller may have to wait hours or even days before a match is found. This could lead to situations where one party has since "moved on" and failed to cancel the transaction with the trading service, generating false positives in terms of matches. This leads to unsatisfied experiences, which leads to bad PR, etc. Something more significant than a captcha would probably be needed to stop trolling and abuse.
3. Trust, but less is required as outlined above than for most exchanges.
As I said above, I've left out some of the finer details because this is already a long post as-is. If you managed to get this far, then I'd like to know what you think of the premise, whether or not (as an EVE player & BTC user) you'd buy ISK with BTC, what else might be missing/wrong, etc.
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