Month: October 2022

The First Successful Metaverse Stablecoin Predates Crypto (and Tilia Gets Investment from J.P. Morgan)

The first successful metaverse stablecoin actually predates crypto! (photo by CoinWire Japan on Unsplash)

In a five-minute YouTube video which dropped today, Amy Jo Kim speaks with Linden Lab’s founding CEO, Philip Rosedale, about a stable digital currency that powers a vibrant metaverse economy—and has kept it running for almost two decades! Of course, I am talking about the Linden dollar.

As I often like to say on this blog, Second Life is the perfect mature, fully-evolved model of a working metaverse which newer entrants to the space would benefit from studying! And whether or not you are already familiar with Second Life, Philip is always a good interview: insightful, personable, understandable, and articulate. Highly recommended!

In related news, were you aware that Linden Lab’s financial subsidiary, Tilia, has recently secured a strategic investment (amount unnamed) from J.P. Morgan Payments? According to the official press release:

Tilia LLC, the all-in-one payments platform, today announced it has secured a strategic investment from J.P. Morgan Payments. Tilia’s solution, built for game, virtual world and mobile application developers handles payment processing, in-game transactions, as well as payouts to creators by converting in-world tokens to fiat currency including USD, which serves as the backbone of any functioning virtual economy.
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Drew Soinski, Senior Payments Executive, Managing Director, J.P. Morgan Payments said “We believe that contextualized commerce – such as virtual economies within games and virtual worlds – is an area perfectly positioned for innovative payments solutions to play a critical role in the coming years. We’re delighted to invest in Tilia LLC, a market leading provider of software gaming payments tools, to develop solutions for these new and exciting marketplaces.”

Tilia’s virtual payment system easily and securely converts in-game tokens and currency into fiat currency. Built from the ground up to power Second Life and its creator-based economy, Tilia was developed over several years to build its unique capabilities. Tilia has secured the required money transmitter licenses in the U.S. to support payouts, allowing for secure transactions on a large scale. Tilia provides developers with the tools to enable thriving, profitable in-world economies that empower their players and users to buy and sell virtual goods and services and facilitate robust play-to-earn programs.

“Virtual economies represent a huge financial opportunity particularly for game, app and virtual world developers,” said Brad Oberwager, Executive Chairman of Tilia LLC. “J.P. Morgan Payments, a worldwide leader and recognized innovator in payments, is the right partner as we continue to expand capabilities in line with these rapidly growing creator-based economies”.

Charlie Fink of Forbes writes:

Tilia has been running Second Life’s $650 million dollar economy for the past seven years. Financing for the new company is coming from their strategic partner, JP Morgan. “It’s very important virtual worlds have the instantaneous settlement Tilia provides,” said Brad Oberwager, Executive Chairman of Tilia, and acting CEO of Linden Lab. “We can handle very high transaction volume at very low dollar amount that even with USDC, the systems aren’t built for that kind of stuff. We move one 250th of a dollar sometimes.”

In addition to the investment, Tilia is also working with J.P. Morgan Payments to increase payout methods and expand the number of pay-out currencies. Perhaps most importantly, partnering with the world’s largest bank will enable Tilia to scale to the potential size of the putative metaverse.

Dean Takahashi of Venture Beat adds:

Oberwager sees his company as crucial for the metaverse.

“Tilia is money into the metaverse. It’s money moved into the metaverse and money moved out of the metaverse,” said Oberwager. “And why this is so important is because you cannot have this concept of the metaverse without a social economy. It is both the social aspect and the financial aspect. Those two things must work in harmony. To do money, you need some virtual token to make money work.”

He added, “Money has to be rock solid. That is JP Morgan. That’s the partnership. What’s the value of Tilia? You can’t build a metaverse without user-generated content. You can’t build a metaverse without social interaction. You can’t build a metaverse without some sort of financial token that allows people to build a world.”

The company will use the funds to expand its business and go into new markets.

“We are moving money in the metaverse,” Oberwager said. “It’s a real thing. that’s where the investment is going. We have a customer list and people are coming to us.”

Tilia fuels commerce in Second Life, which generated $86 million in payments in the past 12 months. The Second Life economy is still measured at $650 million nearly 20 years after its founding. Tilia has about 48 employees.

Oberwager said the deal took about a year to work out with J.P. Morgan Payments. During that time, Tilia made sure it could be interoperable with J.P. Morgan.

Fellow metaverse blogger Wagner James Au provides a bit of context:

Finance giants like J.P. Morgan make strategic investments like this on the expectation they’ll be accessing a larger market down the road, i.e. burgeoning metaverse platforms with less experience than Linden Lab handling international payments/virtual currency.

On the other hand, Tilia has been a standalone company since 2019 and only counts Second Life and below-the-radar metaverse platform Upland as its major consumer-facing clients. (Despite a partnership with Unity in early 2022.) But with JP Morgan as a backer, I’d expect other customers to come along soon.

I agree with Wagner; I’m pretty sure that this partnership will lead to more metaverse platforms using Tilia to implement their in-world economies! (By the way, this news has absolutely zero impact on Second Life. Everything stays the same.)

Second Life Steals, Deals, and Freebies: Spend L$98 at Beauty Factory and Get 296 Items of Womenswear!

If your female avatar likes to wear pink, then do I have a bargain for you! Every October, the Beauty Factory womenswear store has an event to celebrate Breast Cancer Awareness Month, and this year, they are giving away a big pink box stuffed to overflowing with pink outfits. Baby pink, hot pink, and every shade of pink in between! Just teleport to the Beauty Factory store, join their group for only L$98, and click on the big pink box in the centre lobby to pick up your copy (see black arrow):

Find a spot with build rights, and unpack the big pink box. Inside are five more boxes, and inside those five boxes are a total of two hundred and seventy-four items of clothing! You’ll have to unpack each item separately, which might take you a little while, but it is so worth it!

Dresses, gowns, jumpsuits, rompers, tops, pants, leggings, fishnet, you name it—if it’s pink, it’s in there!! All items fit Maitreya Lara and Lara-compatible mesh bodies (e.g. LucyBody Atenea and Kalhene Analexa). Most items also come in a size to fit the Meshbody Legacy body, and a few come in sizes to fit Belleza Freya and INITHIUM Kupra.

Second Life supermodel Vanity Fair models just a few of these outfits (please click on each image in the gallery below to see it in a bigger size):

Emma dress
Deby top and shorts
Beatriz dress
Lux top, Adore leggings
Ashe jumpsuit

If you were not already a member of the Beauty Factory store group, your L$98 join fee nets you 274 gifts from the big pink box, PLUS another 22 group gifts from their spacious Gift Room, on the opposite side of the wall where you picked up the big pink box (exact SLURL). That’s a total of 296 items for only L$98, which works out to L$0.33 per item—a deal by any measure!

The catch is, you need to act quickly, because this bargain only runs until noon (Second Life Time/Pacific Time) of Friday, October 21st, 2022. So hurry down!

The Wall Street Journal Reports that Meta’s Horizon Worlds Is Falling Short of Internal Performance Expectations

In an article published today in The Wall Street Journal, titled Company Documents Show Meta’s Flagship Metaverse Falling Short (archived version here), Jeff Horwitz, Salvador Rodriguez, and Meghan Bobrowsky report that Meta’s flagship social VR platform, Horizon Worlds, is falling short of the company’s own internal performance expectations. They write:

Meta initially set a goal of reaching 500,000 monthly active users for Horizon Worlds by the end of this year, but in recent weeks revised that figure to 280,000. The current tally is less than 200,000, the documents show.

Most visitors to Horizon generally don’t return to the app after the first month, and the user base has steadily declined since the spring, according to the documents, which include internal memos from employees.

By comparison, Meta’s social-media products, including Facebook, Instagram and WhatsApp, together attract more than 3.5 billion average monthly users—a figure equivalent to almost half the world’s population. Horizon is currently reaching less than the population of Sioux Falls, S.D.

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In a survey of Horizon users, Meta researchers said users reported that they couldn’t find metaverse worlds they liked and couldn’t find other people to hang out with. Other complaints included that “people do not look real” and that the avatars don’t have legs.

The researchers noted that the survey included only 514 people because the available pool of users to survey is “small and precious.”

The number of Horizon users online at the same time, known as concurrency, trails far behind both the socially-focused upstart VRChat and Second Life, the pioneering cyberworld that was launched in 2003, said people familiar with the matter.

While the article doesn’t give user concurrency figures for Horizon Worlds, it does state that they “trail far behind” both VRChat and Second Life, for which we do have figures. Second Life user concurrency figures range from 27,000 to 51,000, depending on the time of day and the day of the week, with a recent peak of 55,737 on Feb. 5th, 2022. And according to Steam statistics, VRChat reached a peak user concurrency of 42,564 (blogger Wagner James Au has reported that VRchat hit an all-time high of 89,300 concurrent users during New Year’s Eve 2021 celebrations).

The WSJ report also states that only 9% of the worlds built by creators are ever visited by at least 50 people, and most created worlds are never visited at all. Also, men outnumber women in Horizon Worlds by two to one, a gender imbalance that can lead to women being harassed and feeling unsafe.

Among the persistent complaints from early adopters and testers, according to the documents, are that users have trouble adjusting to the technology, and that other users behave badly.

On a recent night, a female Journal reporter visited one of Horizon’s most popular virtual worlds, the Soapstone Comedy Club. It had about 20 users in it, all appearing as avatars. When the reporter introduced herself and tried to conduct an interview with a small group, one user replied: “You can report on me, baby.” The same user then asked her to expose herself.

One user who was flirting with a woman in the crowd was interrupted by what appeared to be his real-life girlfriend yelling obscenities at him in the background.

According to the documents, men outnumber women in Horizon by two to one. One safety feature Horizon has introduced is an option for users to create the equivalent of a 4-foot personal boundary for their avatars to deter unwanted physical contact.

Even worse, the WSJ article reports that “more than half of Quest headsets—the entry model costs about $400—aren’t in use six months after they are purchased, according to people familiar with the data.” This news greatly surprises me, because I would have assumed that, even if Horizon Worlds is not attracting and retaining users, at least consumers who bought the wireless virtual reality headset would be using it for games.

Coming on the heels of the mixed reaction to the Meta Connect 2022 keynotes by Mark Zuckerberg and his executives, it seems clear that Meta is struggling with numerous internal and external challenges as it attempts to build Mark’s vision of the metaverse.

UPDATED: AltspaceVR Support for the Valve Index VR Headset

Have you joined the RyanSchultz.com Discord yet? You’re invited to join over 700 people from around the world, representing every social VR platform and flatscreen virtual world, who discuss, debate, and argue about the ever-evolving metaverse and the many companies building it! More details here. 

The Valve Index

In a disappointing piece of news, it appears that the popular Microsoft-owned social VR platform AltspaceVR has dropped support for the Valve Index virtual reality headset (which is, of course, the one I currently use at home). All mention of the Valve Index has been removed from the documentation on its website:

A year ago, the Road to VR tech website reported that the Valve Index was the second most-used VR headset on Steam, and even as recently as last June, demand for the product has remained strong. So it is a bit of a puzzle as to why AltspaceVR would decide to stop supporting the still-popular Valve Index.

One person on the RyanSchultz.com Discord server reports:

It worked a year ago, but now when I try to start up the app using the Index, the login screen is skewed and distorted and appears on the bottom right of my field-of-view. Totally unusable now. So no more AltspaceVR for me.

Another noted, “It’s not even on the website anymore, I wonder why they keep it as supported on Steam, it confuses users.”

The Steam page for AltspaceVR still lists the Valve Index as supported

There has been some speculation that, with the recent announcement that Microsoft is working with Meta to integrate Microsoft Office 365 and Microsoft Teams with Horizon Worlds and Horizon Workrooms, Microsoft might be preparing to shutter AltspaceVR. I do find this a little hard to believe, since it is still a popular social VR platform, supporting dozens of meetups and events. I guess we’ll see.

UPDATE Oct. 13th, 2022: BenG tells me:

Just saw the new blog post, the Valve Index was never listed as a supported headset anywhere except for the Steam page and that was only because it was automatically added to all SteamVR games when the Index launched. I’ve been asking for Index support ever since I got mine in 2019, but I was always ignored. So they didn’t drop support for it, they never supported it in the first place. It somewhat worked, but the controllers were seen as Vive wands, so it wasn’t great. I had a much better experience using Revive to get into AltspaceVR, since the Index controllers match up with the Oculus controllers.

Thanks for the clarification, Ben!

Thank you to passTheKetchup and CGVR on the RyanSchultz.com Discord server for the heads-up on this news!