High Fidelity Begins a Pilot Test of Trade Between Its High Fidelity Coin (HFC) and Ethereum (ETH): Will This Step Jumpstart Its Economy?

HFCtoETH.jpeg

High Fidelity is the first of what I call the “Big Five” social VR platforms (i.e., HiFi, plus Sansar, Sinespace, VRChat, and AltspaceVR)  to set up a blockchain-based in-world currency, called High Fidelity Coins (HFC). On January 8th, 2019, High Fidelity announced that it would begin testing the trade of High Fidelity Coin and Ethereum (ETH; a popular cryptocurrency):

Initially, we will allow users to purchase HFC using ETH. We will conduct trades of HFC in fixed amounts equivalent to $25 or $50 (HFC 2,500 or 5,000). Since HFC is a stablecoin pegged to the US Dollar, while Ethereum varies against the Dollar, the exchange rate between HFC and ETH will fluctuate.

We are currently allowing creators and performers that have earned in-world currency to sell their HFC for payment directly for USD. These trades are handled in-person with High Fidelity staff. As we enter the New Year (2019), we will begin offering automated tools to support selling HFC for ETH.

As we’re still learning about trades for ETH, we’ll begin by scheduling in-person (in-world) trades for users buying HFC with ETH. A High Fidelity banker will specify an Ethereum wallet to deposit your ETH to pay for the trade. You’ll receive HFC from the bank on the successful completion of your trade. You can schedule an appointment here.

If you’re new to the world of blockchain trading, you can learn more about one of the more common trading platforms (Coinbase) here. You can learn more about the steps required to set up a wallet for payment here.

Over time, we see this being our primary method for purchasing and selling HFC. It’s convenient, global, well-governed and broadly adopted. In future, we may enable trades to other cryptocurrencies or tokens, either directly or through third-party exchanges. We also hope that HFC will be used by other VR platforms or applications, making the transfer to Ethereum even more useful.

High Fidelity also published a list of Frequently-Asked Questions (FAQ) about this move:

Who can trade HFC and ETH?

All High Fidelity users will be able to buy and sell their HFC for ETH. An ETH wallet will be required.

What is the HFC to ETH exchange rate?

HFC is pegged to the US Dollar. US $1 = HFC 100. Since the value of ETH floats against the Dollar, the value of High Fidelity Coin floats against Ethereum in turn.

Why is HFC a stablecoin?

Speculation in High Fidelity Coin as a cryptocurrency would be counter to our goal of creating a thriving economy in High Fidelity. If the real world value of HFC changed unexpectedly for non-economic reasons, the potential rewards for creators and those working in High Fidelity would become unpredictable, discouraging users to hold and trade with the currency. We want people to know they can cash out their HFC at any time for a fixed real-world value.

Can we still trade directly for US Dollars?

Yes, but this may be discontinued in 2019.

Will you start trading HFC for Bitcoin?

In future, we may enable HFC trading for other cryptocurrencies, including Bitcoin.

Why aren’t you just using ETH in the first place?

High Fidelity has developed its own cryptocurrency, HFC, since traditional blockchain currencies are not suitable for a virtual world environment. Specifically, ETH is more of an asset class than a stable trading currency. Its value varies over time, making it difficult for traders to use the currency in fair exchange for goods. Additionally, HFC trades more quickly and without built-in transaction fees. Currencies that rely on a proof of work method to generate and confirm blocks (e.g. Bitcoin) currently require too much time to be used as a real-time transactional currency.

This is uncharted territory for High Fidelity, and a step not without some risk, despite their assertion that they want HFC to be a “stablecoin”. Many other social VR and virtual world platforms will no doubt be watching closely to see how well HiFi’s economy adapts to this change. High Fidelity is still having a bit of difficulty getting its economy off the ground, and encouraging content creators to make and sell products on its Marketplace, at least compared to the relative success of the Sinespace Shop and Linden Lab’s Sansar (where the Sansar Store now boasts well over 18,000 items on sale). Linden Lab and Sinespace currently have no plans to introduce cryptocurrency on their platforms, as far as I am aware.

Could this move backfire? Given the constraints that High Fidelity has put in place, it seems doubtful that this could fail. However, many Ethereum owners will likely hesitate before exchanging their hard-earned cryptocurrency to HFC. While HFC might prove a safe haven in the current bear market, it may also prove a trap in times when ETH is soaring in value. Frankly, blockchain-based virtual worlds are just too much of a risk for me to even contemplate investing a penny, and I would urge anybody who does to do every single scrap of their homework before investing in any cryptocurrency.

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A Nasty Dispute Between Improbable and Unity Puts Several Virtual Worlds/Games in Jeopardy

Worlds Adrift 11 Apr 2018
Worlds Adrift is one of the virtual worlds impacted by the disagreement between Improbable and Unity

The Guardian newspaper reports that a spat between two companies, Improbable and Unity, has put numerous virtual worlds/games in jeopardy:

[Improbable’s] core product, a cloud-based server system called SpatialOS, allows video game developers and others to build enormous virtual worlds that exist and operate independently of player action.

SpatialOS only works in a finished game when paired with a graphics engine capable of displaying those worlds on the computers, phones or games consoles of players.

On Thursday, the developers of one of the largest commercial engines, Unity3D, told Improbable that a change to the engine’s terms of service was intended to block SpatialOS, and all games created that use the technology – including those which had already shipped – from working with Unity.

“Unity has clarified to us that this change effectively makes it a breach of terms to operate or create existing SpatialOS and Unity games and in-development games, including production games,” Improbable said on its website.

The company added: “Unity has revoked our ability to continue working with the engine for breaching the newly changed terms of service in an unspecified way.

“Overnight, this is an action by Unity that has immediately done harm to projects across the industry, including those of extremely vulnerable or small-scale developers and damaged major projects in development over many years.

“Games that have been funded based on the promise of SpatialOS to deliver next-generation multiplayer are now endangered due to their choice of front-end engine. Live games are now in legal limbo.”

Among the virtual worlds/games which are suddenly impacted by this dispute are Worlds Adrift (which has already launched) and Seed (which is a promising virtual world/MMO still in development).

Frankly, this sort of dispute is one of the reasons why companies such as Linden Lab and High Fidelity build their own game engines, even though that means it often takes longer to add new features. For example, both Sinespace and VRChat are built on top of the Unity game engine (one of the companies involved in this particular fight), which means that they have to carefully check for things that break whenever Unity issues an update to their game engine.

Then again, Linden Lab and High Fidelity need to do that when they update their in-house game engines as well. But at least they have complete control over the situation. I’m sure that the developers of Worlds Adrift and Seed are feeling rather powerless tonight.

Thanks to Gindipple for the heads up!

Linden Lab Launches the Sansar Social Hub

Sansar Social Hub Product Meetup 10 Jan 2019.png

Today’s Product Meetup was held at the brand new, attractively designed, and futuristic Sansar Social Hub (which is a new feature of today’s client update). The Social Hub is accessible via a teleporter from the Lookbook space when you first log in:

Social Hub 10 Jan 2019.png

I’m really glad that Linden Lab decided to do this; I know that they had been reluctant to create a social hub in the past, but I think it’s a necessity for a (relatively) new platform that wants to engage its users and encourage them to mingle.

It also counters the commonly-heard complaint that Sansar is “deserted” and “empty”. What better way to address that than to create an easily-accessible space where people can touch base with each other? I know that I will be spending time at the Social Hub to meet up with friends and to greet and welcome newcomers, and I’m sure I’m not the only one who plans to do so. (I used to do this all the time at Cloud Party‘s social hub back in the day, and I met many interesting people that way, including people who are now in Sansar.)

This was also the first Product Meetup since Linden Lab announced that Sansar’s Community Manager, Eliot, was no longer with the company. It remains to be seen whether LL will post the position on their careers website, or fill the vacancy from within. Being a Community Manager for such a fractious, demanding clientele can often be a thankless task. I’d like to take this opportunity to thank Eliot for his hard work, and I wish him well in his future endeavours, whatever they may be.

Pursuing the Holy Grail of Second Life in Virtual Reality: A New Solution Using Firestorm and SteamVR

holygrail
Obligatory image from Monty Python and the Holy Grail (1975)

I first heard the news from Wagner James Au of the long-running Second Life blog New World Notes: someone has come up with a new way to navigate SL in a VR headset!

OK this is pretty amazing: Someone named Peter Kappler quietly created code to run Second Life in VR via Firestorm and Steam VR, and then posted the source code online. “It’s not a fully working Firestorm,” he allows on his YouTube, “there is still a lot to do. The file I posted is a source file in C++ for coders that wish to maybe work on a VR version for Second Life.”

There have been at least two other attempts to create a VR port for Second Life, but performance has not been impressive — Linden Lab had an experimental client of its own, but discontinued supporting it due to lack of decent frame rate. The demo video…suggests Kappler has come up with a fairly decent port; better yet, by open sourcing his code, he’s encouraging other developers to improve it further.

Here’s the eight-minute demo video Wagner refers to (there’s no sound):

Now, there is no guarantee that this open-source solution (which relies on SteamVR and the Firestorm viewer code) will be able to attain the high framerates required to avoid VR sickness. But it does look somewhat promising!

Second Life was never intended for VR; the platform is simply too dated to support it. Any solution will be a kludge at best. But I do find it interesting that people keep pursuing the Holy Grail of SL in VR, anyways. I wouldn’t mind trying this out myself, just to see how well it works.

Thank you for the heads-up, Wagner!