Players are also able to sell and purchase these tokens on the Auction house for in game gold at the current market price. One interesting point is that if a player purchases these tokens from the Auction house in WoW gold, the token becomes Soulbound so it can only be sold once and should be redeemed within 30 days. The fact that this WoW gold is not tradable multiple times makes it more secure against attacks and compromised accounts.

However, one big question that arises here is why did Blizzard opt for in-house digital currency? Simply to get some cash flowing from their users? The answer is simple: Because they appreciate a closed market where they can control the supply of their coins, and also their proposed system is simpler to maintain against cyber-attacks on accounts.

World of Warcraft certainly dwarfs any other online multi-player game in the gaming industry and this news has gone raised the hopes for gamers in the Bitcoin community toward bitcoin acceptance across Blizzard games. The issue of taxing virtual assets is a complicated one, but the primary point of justification offered by many economists, even if they're only talking "in theory," is the fact that these virtual assets have an established real-world value.

When gamers started selling their virtual armor and horses and castles for real-world cash, they established an exchange rate. For instance, if we know what a suit of armor sells for in "EverQuest" or "World of Warcraft" gold, and we know what the same type of suit of armor sells for on eBay in U.

And theoretically speaking, for tax purposes, anything that has a real dollar value is taxable once it changes hands. So if you sell a suit of armor to another player for a certain amount of gold, it's possible for the IRS to tax that transaction as income earned in the converted U.

In August , one U. In , the IRS began to seriously assess the risk of losing tax revenue to unreported virtual income. We'll take a look at the GAO's recommendations on the next page. Advertisement From Bartering to Bitcoins When online sales of virtual assets for hundreds and thousands of dollars became commonplace, the U. When the GAO issued its report in May , it began by comparing virtual currency transactions to another type of cashless transaction, bartering.

Bartering is the exchange of goods and services for other goods and services without any actual money changing hands. In the s, small bartering economies sprung up across the U. In the mids, the IRS decided to add bartering income to its list of taxable transactions.

Again, the issue was cash value. If income from bartering is taxable by the IRS, argues the GAO, then income from certain virtual currency transactions should be taxable, too. The GAO divides virtual currency systems into three different categories, each with its own tax implications: Advertisement Closed-flow System: There is no interplay or exchange between virtual goods and services and real money. An example is a MMORPG in which players earn virtual "gold" by performing certain tasks within the game, then use that gold to buy virtual clothing and weapons.

Since none of those items have cash value in the real world, any income or assets earned from the game cannot be taxed. Hybrid System: Some transactions are taxable and others are not. In "WoW," a player can choose to keep all transactions within the virtual world using only "WoW" gold as currency. Those transactions don't produce taxable income. But there are also third-party exchanges outside of "WoW" where players can buy and sell "WoW" assets for real money.

In that case, when a virtual sale results in real profit, the income may be taxable [source: GAO ]. Open-flow System: Most transactions are taxable. Since Linden dollars have an established cash value, the IRS can easily determine the real-world value of virtual transactions. That's taxable income.

For all the talk of online role-playing games, the biggest player in the virtual currency world -- and the most worrisome to the IRS and the U. As the GAO explained in its report, Bitcoin is the ultimate open-flow system.

Phase 1: October 27 Talent System Rework: "DragonFlight" brings important updates to the major class in World of Warcraft, and re-launches the talent tree system.

TECHNICAL ANALYSIS TREND LINES FOREX

World of Warcraft is one of the biggest games of all time. World of Warcraft gold Within the game, players are able to purchase goods using the in-game currency known as gold. Whilst this might seem commonplace nowadays with V-Bucks in Fortnite, in-game currencies were not so common in the early days. The process was simple: you would purchase the gold with fiat currency and then use it to buy things in the game.

Certain items that could be looted from some of the toughest bosses soon became extremely valuable. In using an online digital currency, gamers became used to online transactions, markets, and converting their money back to fiat. Whilst this allows them to manage the market and reduce volatility, it also means they retain the power to halt transactions and ban users for misbehaving.

On top of this, scarier trends can occur. In , it was revealed that Chinese prisoners were being forced to play World of Warcraft and farm for gold. Story continues Game developers have tried to reduce such occurrences, although this has proven hard. Fortnite, one of the most popular games on the market, has been accused of abetting money launderers through its platform. This is one of the key reasons why decentralised cryptocurrencies could pose issues were they to be implemented within a gaming ecosystem.

Can blockchain help? Ownership of digital assets in games such as World of Warcraft is one issue that blockchain could solve. Were you to earn a very expensive item in the game but your account is accidentally deleted, you would lose that item. This is very similar to bank transfers, which rely on the same security measures. Therefore, Bitcoin is an account-based system. This would not be a problem for analysts and experts if Bitcoin were not also a token-based system.

So, how is Bitcoin as a token system? When someone wants to spend Bitcoin , there is a protocol by which the validity of these bitcoins is verified. The history of these coins has to be traced. Then, the transaction is carried out. Similar to cash, which is only valid if it originates from a central bank. Therefore, Bitcoin is also a token system. Now, there are a few other examples of token currencies. The distinction between these two is usually raised when governments are trying to figure out a way to create a central bank digital currency.

At the same time, Bitcoin has proven that these two ideas, even though they might seem to contradict one another, can work together. Taxation, Bitcoin, and Video Games Currencies One of the controversial topics in the Bitcoin universe in recent years is how taxation will be applied. If these are also digital currencies, why should they be ignored by the IRS when Bitcoin is taxed?

Other countries are doing the same. So, is Bitcoin different from other digital currencies? What are the significant differences that justify the unique treatment of Bitcoin? If the IRS audited someone due to concerns related to Bitcoin, would that person also have to turn over information on other digital currencies? Theses video games have huge followings, and many of these followings span international borders. There are some situations where people spend real money to boost their standing in these games.

This is where there might be a link between traditional currencies and digital currencies in video games. At its peak popularity, FarmVille had more than 83,, monthly active users. This led to some significant red flags to some people in positions of authority. Of course, the idea of laundering money through a game might sound silly. Still, with over 2. Fortnite V-Bucks Meets Crime Sixgill, a cybersecurity firm, has revealed that V-Bucks obtained through stolen credit cards, an accessory associated with money laundering programs, are being liquidated en masse.

No estimate has been made as to the amount generated by this innovative technique. You might be wondering what the role of Bitcoin is in all of this? Over the years, incumbents have called for a blanket ban on Bitcoin. Although V-Bucks transaction data is not open, it is, therefore, difficult to investigate the illicit use of this currency.

Moreover, it is well known that the volume of Bitcoin transactions related to money laundering represents only a small percentage of the total volume of Bitcoin transactions. Furthermore, World of Warcraft is the most popular online role-playing game in the history of gaming. This game uses an in-game WoW Gold currency.

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