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VB’s primary coverage of the Ginko Financial bank run can be found in two posts below, but there are a few important facts are worth highlighting today.

  • Ginko is, amazingly, having an IPO to try to raise cash. There was actually some limited early activity, but I suspect it was just insiders churning to make it look good. Around 50,000 shares have theoretically traded, netting Ginko about L$25,000. That will cover… let’s see, two and a half withdrawals today. Check out Nobody Fugazi’s piece on this for some solid quick analysis. Here’s the summary: “Shady.” I don’t have even a single Linden in the in-world markets, but my first thought on this was: is there any way to short it?
  • ‘Sarah Nerd’ posted a copy of a June 7 forum post about Ginko’s investments (notably, the original post can be found on a WSE board, which is the other stock exchange Ginko has used to raise money). It describes some of Ginko’s in-world investments, but it states that ‘Portocarerro’ is “uncomfortable disclosing anything regarding the off-world side of things,” which, he admits, account for more than half of the money Ginko owes depositors. I’ll leave analyzing the in-world investments to readers who are more familar with the in-world markets (in fact, I’d really appreciate a comment or two on this if anybody knows how these companies are doing off-hand) but have to ask this: why would ‘Portocarrero’ be “uncomfortable” talking about money that has been taken out of Second Life? That’s kind of an odd way to put it.
  • Crowd at Ginko ATMI spent some time at Ginko’s main ATM after it started working again today. It was crowded (image, right). In spite of giant signs saying there was a L$10,000 limit, many people tried to take out much more (unsuccessfully, of course). I don’t see any reason to believe that it is slowing. Ginko’s “Deposits” number is down several hundred thousand Linden in the two hours that the grid has been back up and semi-stable. For those of you who are trying to get in and access funds but cannot teleport, here’s a workaround.
  • Ginko apparently did not sell any real world assets during the downtime. This adds to my suspicion that they do not have any assets to sell.

We’ll get back to more purely legal issues here soon, but this is clearly very important to many of VB’s readers, and I have received extremely positive feedback on the coverage, so I’ll keep it up until we have some resolution.

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5 Responses to “Commentary: Ginko Bank Run Update – Day Four”

  1. [...] Virtually Blind covers Ginko Bank Run Commentary: Ginko Bank Run Update – Day Four [...]

  2. on 30 Jul 2007 at 7:38 pmBenjamin Duranske

    Readers who stopped by earlier may have seen a note about the identity of Ginko’s management. By virtue of conversations with Ginko associates, I’m convinced that the person I tracked down is a member of management, but not the head, so I am editing the article to remove it. I’m not interested in identifying anyone who isn’t making decisions here, even only by age and general geographic location.

  3. on 31 Jul 2007 at 1:02 pmThe Forge · Brazil is the new Nigeria

    [...] Commentary: Ginko Bank Run Update – Day Four – We discover that Andre Sanchez (known as Nicholas Portecarrero in-game) is going to try to do an “IPO” on an in-world “stock market” to cover the deposits. That alone pretty clearly demonstrates that Ginko is/was a Ponzi scheme. [...]

  4. on 31 Jul 2007 at 2:07 pmAshcroft Burnham

    I cannot conceive of a single legitimate reason for the management of Ginko not to disclose the destination and nature of its first-life investments, or, for that matter, the first-life identity of its managers.

  5. on 01 Aug 2007 at 8:51 pmcsven

    iirc, the lack of disclosure came up on the official forums and generated quite a bit of discussion. For anyone interested in learning more, there might be something worth finding in the archives.

    I personally paid little attention as I’ve always considered such dealings “Shady”.

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