Potential of virtual currency - Research Paper Example

The regimes include the rules that are against money laundering, regulations on the electric money transfer, regulations on gift card and also the requirements on financial privacy. Following the growth of technology social networks, and also, gaming sites have also developed. The networks have evolved to offering individual form of currency. It is also worth understanding that the currencies offered by the networking sites circulate in the entire economy. There are various forms of virtual economies such as the closed loop economies; it is involved in the restriction of users to single entities, and the currency is acceptable.

It also involves the semi-closed loop; it is a loop that enables the user to use the funds and make purchases from sellers who are defined. Lastly, is an open loop that enables the currency to get applied in unlimited numbers to the retailer (Keith, 2011). Due to growth on the gaming systems and also virtual economies the gap between virtual systems and the real world has become blurred. Therefore, it is significant that the people involved in the economies to perform various roles. People involved include the government regulators and also the central bank (David et al., 2011). It should also get understood that there are possibilities of the virtual economies to get converted to real world goods, as well as currencies.

Questions are arising due to virtual economies becoming similar and also interoperable in the real world economies. There are questions as to whether statutes of the real world such as the transfer of funds, money transmitting and also holding of financial transactions is applicable to the websites and other similar services (David et al., 2011). There are also issues regarding the virtue payments due to the evolution of the virtue economies, and they continue to outpace the regulations of the real world. With the