Guild Wars 2

Just curious how the gold to gem and gem to gold conversion prices are set. In other MMOs I’ve played (star trek online) the currency conversion works like the trading post, with buyer and seller able to set a price, and if you are willing to pay the market price or the market price hits your range, the transaction happens. With GW2 I don’t see that implemented.
Does a-net use an algorithm to generate the set point for each of gem-> gold/gold->gem? What happens to the difference between the 100 gems for gold and gold for gems exchange? IE, if you bought 100 gems and immediately turned around and sold them back, it seems like you’d lose a significant amount of gold.

When the game went live the exchange was set up with two pools. One that had a little gold in it while the other had an astronomical amount of gems in it. It’s the ratio between these two pools that set the exchange rates. The initial exchange ratio was in the neighborhood of 25s per 100 gems. So if the exchange was seeded with 1 billion gems, it was also seeded with 2.5 million gold.

The Gold to Gem rate is the exchange ratio / 0.85 while the Gem to Gold rate is 0.85 x exchange ratio. This way it sinks gold (removing it from the game permanently) both coming and going as well as making the gap large enough to discourage any type of TP arbitrage with Gems.

When you buy Gems with Gold the gold, well 85% of it, is added to the exchange’s gold pool and the gems you get are removed from the exchanges’s gem pool. This means there is more gold and fewer gems so the rates move up. The opposite is true when you sell Gems for Gold. The gems are added to the exchange’s gem pool and you get gold from the exchange’s gold pool. Gold pool decreases, gem pool increases so rates go down.

Note that the gold or gems you receive aren’t created by the exchange. They are simply removed from existing pools. So as players convert gold to gems en masse, due to a sale or nifty new Gem Store item, the exchange rate quickly zooms up. And as time goes on, the jumps in the rate due to that kind of activity will drive the rate up at a quicker pace as the exchange runs short on gems. Conversely as the gold to gem rate increases the amount of gold you can get for gems goes up by an equal percentage and it’s the hope that this will drive players into using the exchange to buy gold via cash bought gems to keep the exchange’s rates under control.

ArenaNet set the initial exchange rate for gems to gold when the servers first open for headstart, but after that the rate fluctuated based on supply and demand of the players using the Currency Exchange. The gems and gold players get from the Currency Exchange are supplied by other players, not ArenaNet. As supply of gems goes up, the price will go down and vice versa.

Google found this for me here
http://gaming.stackexchange.com/questions/82853/how-does-the-gold-gem-exchange-rate-get-determined

Thanks Behellagh, that makes sense.