Guild Wars 2

Thing is, the last few times the market got very volatile when new items were implemented into the gem market, as far as I can see Arenanet did put a market cap on the exchange, you can see it right now, it’s nearly horizontal, which is not normal. There’s only booms and glooms in this market, no dooms. Hmm…

When I started to play it was between 1.50g-1.70g for 100 gems, but I’ve read about it being a bunch of silver for 100 gems, it’s an inflation process thats been going on since the beginning of GW2. And seeing how the real economy is going down, people buying less gems with dollars, even more dollars when inflation in the real world kicks in, the price of Gems will only go up harder in the future.

Your gold in this game is not like the gold in real life, in here it’s not money, but a currency. Currencies die over time, Money stays, and in this game the Gems are money.

This won’t affect low level stuff as there is so much of it, but things like ecto’s and orichalcum ore are bound to go up in the long run as well. At least, that’s my guess.

Not true, when Great Brittain announced it would sell tons of its gold in the early 2000’s, the price went down massively, and the Brittish people were defrauded of much wealth! That was a “sale” and “a slap in the face”!

Yes, people “play” this game, but that makes it ok to devalue their efforts?

So, heres what I gota say about it. Good job anet with a great game ill give 40bucks for some gems an some storage space. Oh, and for the people that dont like to support the game changing gold to gems thank you as well for raising the gem-gold rate. You made me money with my left over gems after storage space was bought

Mad Rasputin.7809:

Svarty.8019:

Oh? I didn’t know that.

Yeah, that’s what I was thinking. So I am lead to believe if I had unlimited real life money resources, I couldn’t buy all the gems my heart desired? I would be told at some point that there are no longer any gems I can purchase with real life currency and I have to wait for some gems to be exchanged for gold?

I really just don’t believe this.

That’s not what he’s saying. Gems are created by buying them with real world currency; those gems are unlimited. The gems being purchased with in game currency are limited because you can only exchange for gems that other players are selling.

I’m curious, assuming the argument that a 20% discount should apply to the gem exchange rate (I think people here have done a good job of explaining why the sale isn’t a sale on the exchange, so lets leave that be). What system do you use to create a moving 20% discount on exchange, keeping in mind that the supply of gems is not unlimited, and that the exchange does not fabricate gems?

Cheat. ANet can generate gems and gold in infinite quantities as they see fit. They merely choose not to. While I don’t see the specific need to discount gems in the exchange whenever there is an attractive gem store sale, if ANet wanted to do so, they would merely need to generate and dump a ton of gems into the exchange until the price dropped to the desired level, and then buy them all back out of the system if it fell below that. That the market does not currently work this way is entirely a design choice, not a design necessity.

Ohoni.6057:

Cheat. ANet can generate gems and gold in infinite quantities as they see fit. They merely choose not to. While I don’t see the specific need to discount gems in the exchange whenever there is an attractive gem store sale, if ANet wanted to do so, they would merely need to generate and dump a ton of gems into the exchange until the price dropped to the desired level, and then buy them all back out of the system if it fell below that. That the market does not currently work this way is entirely a design choice, not a design necessity.

The problem with that approach is they would almost instantly lose any credibility with reasonable folk about whether or not they are influencing the gem rates.

At this point, reasonable people have no reason not to believe ANet when they say “We don’t do anything to directly affect gem exchange costs.” All it takes is one adjustment, in either direction, and then even reasonable people will begin to question whether or not they’re telling us about all the moves they make there – the temptation once started is too high, so the only point of trust is at no adjustment at all.

Well, it certainly seems like the goal is to keep the exchange rate at 2g+ for 100 gems because every time it dips below that something else goes on sale.

As for purchasing gems for real dollars, the last time I did I got burned by their no refunds policy (which incidentally was not stated on their refund support page). Until that changes they won’t be seeing another cent from me.

EnemyCrusher.7324:

Mad Rasputin.7809:

Svarty.8019:

Oh? I didn’t know that.

Yeah, that’s what I was thinking. So I am lead to believe if I had unlimited real life money resources, I couldn’t buy all the gems my heart desired? I would be told at some point that there are no longer any gems I can purchase with real life currency and I have to wait for some gems to be exchanged for gold?

I really just don’t believe this.

That’s not what he’s saying. Gems are created by buying them with real world currency; those gems are unlimited. The gems being purchased with in game currency are limited because you can only exchange for gems that other players are selling.

That is what I would expect too.

But isn’t having an unlimited supply of gems via real world currency going to influence the market in some fashion? It really is not a closed economy with fixed amount of gems and gold.

I keep reading about economic principles here and how there is a fixed amount of gold and gems and that is the reason why the gem/gold ratio fluxuates like it does. But if the powers that be can just infuse a large amount of gems into the market via real world currency purchases, isn’t that going to have an effect on the economy? Doesn’t that manipulate the market, to some degree?

Lane.3410:

Well, it certainly seems like the goal is to keep the exchange rate at 2g+ for 100 gems because every time it dips below that something else goes on sale.

As for purchasing gems for real dollars, the last time I did I got burned by their no refunds policy (which incidentally was not stated on their refund support page). Until that changes they won’t be seeing another cent from me.

You won’t buy gems because you can’t get a refund? Call me crazy but I’ll bet Anet is okay with that.

As for the other thing, 2g for 100 gems is actually really high for the games life. Right now is really the first time the average has even been as high as 1.98g for 100 gems.

The average price for most of the games life has been roughly $1 = 1 gold. Right now it’s floating around $0.77 = 1 gold.

As I said in a previous post in this thread, gems have not reached their equilibrium yet. The gems → gold ratio is pretty bad. When that gems better more people will start selling gems for gold and once that number meets equilibrium with those who buy gems with gold the price will stabilize. My guess is that will be somewhere between $0.25 and $0.50 = 1 gold.

So yeah, that means you should expect 100 gems to cost you around 3-5 gold eventually. You have to remember that in spite of the intermediary (the gem exchange) you are effectively buying gems from players. Players need to feel like the amount of gold they are getting for their real money is worth it. Right now most probably don’t feel it’s worth it (you obviously don’t).

It’s obviously not a true market, because we don’t bid on how much gold you would be willing to pay for the gems. So there’s really no way to value the price of a gem.

My guess is that there’s some formula that causes the price of gems to tick up when people buy them with gold and tick down when people buy gems with cash.

Basically, people can get anything in cash shop with in game money and yet they still complain. There are so many MMOs that don’t do that and I don’t see outraged people on their forums. There are day 1 DLCs and hey, people still buy them in droves (I think it’s an outrage). Price in gems went down 20% that’s it. Gold/gems conversion is just a bonus that Anet was nice to even give (compared to many many other games).

Novalight.7568:

Basically, people can get anything in cash shop with in game money and yet they still complain. There are so many MMOs that don’t do that and I don’t see outraged people on their forums. There are day 1 DLCs and hey, people still buy them in droves (I think it’s an outrage). Price in gems went down 20% that’s it. Gold/gems conversion is just a bonus that Anet was nice to even give (compared to many many other games).

Not sure how many other free to play mmo’s you have played, but plenty of them let you trade the cash shop currency for in game currency, and they even let YOU set the price you want to sell that cash shop currency for (see Runes of Magic). The game providers do that because they can make money off people converting dollars to cash shop currency to in game currency.

Give me a break about the altrustic notions of the game provider. It is a business, and they are in it to make money. Apparently, at least they have been able to fool some people into thinking this service is out of the kindness of their hearts.

EDIT: And to take it even farther than that, at least in other cash shop games (Runes of Magic used again for example) when you post an auction converting cash shop currency to in game currency, you can see the price and the seller, and know that you are paying 20 gold for 2000 gems, because Real-Gamer-Jack is selling it for that. You may be getting ripped off, but at least you know its that guy doing it, and not some magic formula or black box telling you that X gold = X gems today, because thats just how it is today.

Unspecified.9142:

You won’t buy gems because you can’t get a refund? Call me crazy but I’ll bet Anet is okay with that.

I think you misunderstood me, or I didn’t properly clarify, I wasn’t looking to get my money back. I simply wanted the gems I’d spent refunded. I’d planned to re-spend them as well as purchase/spend more, but because of their policy they refused and thus I was stuck with my (unused) purchase. Needless to say, that didn’t provide much incentive for me to invest any more money with them so I haven’t since.

i bought a bank tab being they r on sale thru the black lion trading company. sent me one in mail to double click on and it says i have maxed out on my bank tab. so why did it sell me a worthless item to me . that is quite a sale? gets u to buy stuff you cant use. did i really waste all them gems or can i get them back somehow??

Molly.8643:

i bought a bank tab being they r on sale thru the black lion trading company. sent me one in mail to double click on and it says i have maxed out on my bank tab. so why did it sell me a worthless item to me . that is quite a sale? gets u to buy stuff you cant use. did i really waste all them gems or can i get them back somehow??

There is a warning right on the sale announcement the the max bank tabs you can have is 8, including your original free bank tab, and to make sure you don’t try to purchase more than you can use. /faceplam

Solandri.9640:

Leablo.2651:

But people will still argue that the market is too smart to legitimately pay 600g for a precursor.

The vast majority of the market is too smart to pay 600g for a precursor.

Aaaand we have a winner! But to address what you said, there is no “majority of the market”. Prices aren’t determined by vote. If prices are high enough that these people won’t consider buying it, then they aren’t in the market. They can’t form a “majority of the market” when they aren’t even in it.

There is no prescribed “actual value” of any item other than the price that items get bought and sold for. What they get bought and sold for is, by definition, the actual value of the item.

John Smith.4610:

As a quick aside. Gems in the currency exchange are finite. You may buy gems with real money to your hearts content, but if you don’t put any of them gems into the currency exchange the currency exchange’s stock of gems never changes.

Actually it sounds like what you’ve described is an INfinite amount of available gem stock. Unless what you’re saying is that if nobody buys gems with real money, nobody ever spent their gems, and everyone kept buying them with gold, then the system would eventually run out of gems, there’s an infinite amount of gems.

John Smith.4610:

Think of it this way. The government can print as much money as they want, that doesn’t mean your bank account has access to that money. The currency exchange does not have access to gem creation. It has a limited stock that players add and subtract from.

So does that mean that there could theoretically be a situation where players would be unable to exchange gold for gems?

Geikamir.6329:

John Smith.4610:

Think of it this way. The government can print as much money as they want, that doesn’t mean your bank account has access to that money. The currency exchange does not have access to gem creation. It has a limited stock that players add and subtract from.

So does that mean that there could theoretically be a situation where players would be unable to exchange gold for gems?

yes

Since there’s a finite pool of Gems in the exchange to work with, should someone “manipulate” it (since so many people love to throw around that word), it could empty, and no one would be able to convert their Gold for Gems.

The safety net to that is with more people converting Gold into Gems (as seen as spikes in the charts during promotions and holiday events), the exchange rate increases to the point where people would probably stop before the Gems ran out in the first place.

But that’s when players like me come in. When we see the rates for Gems to Gold getting more profitable, we jump in and put our own Gems back into the pot.

Redscope.6215:

John Smith.4610:

As a quick aside. Gems in the currency exchange are finite. You may buy gems with real money to your hearts content, but if you don’t put any of them gems into the currency exchange the currency exchange’s stock of gems never changes.

Actually it sounds like what you’ve described is an INfinite amount of available gem stock. Unless what you’re saying is that if nobody buys gems with real money, nobody ever spent their gems, and everyone kept buying them with gold, then the system would eventually run out of gems, there’s an infinite amount of gems.

No, he’s saying if you choose just to spend your Gems at the Gem store, then the pool of Gems at the exchange never grows. It only grows if you buy Gems with real money and then convert them into Gold.

However if the pool is significantly large, it may take some time for that reserve to run out. However as the Gem pool shrinks, the conversion rate goes up and it becomes more attractive to convert Gems into gold thus restocking the pool.

This would explain why in the long view that the exchange rate has been on a steady climb since the game went live. The pool is growing smaller thus the exchange rate has been steadily rising. At some point it will reach a level where it will be attractive to more players to buy Gems for real money and convert them into gold. We’re just not there yet.

After all the game only makes money on sale of the game and the sale of Gems. Those are the only two sources of income to keep the game running and I’m guessing a reasonable chunk of the game sale goes toward paying off the 5 year development costs, depending how much NCsoft let ArenaNet keep from the GW1 days. Now I’ve read that F2P MMOs are aiming at 10% of their active player base to drop $15 a month in the store to be considered very successful. I expect that’s the plan here as well. A rising exchange rate helps that.

Digging through some EVE data, PLEX, their method of converting real money into ingame currency, was worth 325 million ISK at the start of 2009, it’s around 500 million right now and I believe they use a straight up market place to set the exchange rate. So inflation happens there as well and it’s entirely in the players control.

Behellagh.1468:

Redscope.6215:

John Smith.4610:

As a quick aside. Gems in the currency exchange are finite. You may buy gems with real money to your hearts content, but if you don’t put any of them gems into the currency exchange the currency exchange’s stock of gems never changes.

Actually it sounds like what you’ve described is an INfinite amount of available gem stock. Unless what you’re saying is that if nobody buys gems with real money, nobody ever spent their gems, and everyone kept buying them with gold, then the system would eventually run out of gems, there’s an infinite amount of gems.

No, he’s saying if you choose just to spend your Gems at the Gem store, then the pool of Gems at the exchange never grows. It only grows if you buy Gems with real money and then convert them into Gold.

However if the pool is significantly large, it may take some time for that reserve to run out. However as the Gem pool shrinks, the conversion rate goes up and it becomes more attractive to convert Gems into gold thus restocking the pool.

This would explain why in the long view that the exchange rate has been on a steady climb since the game went live. The pool is growing smaller thus the exchange rate has been steadily rising. At some point it will reach a level where it will be attractive to more players to buy Gems for real money and convert them into gold. We’re just not there yet.

After all the game only makes money on sale of the game and the sale of Gems. Those are the only two sources of income to keep the game running and I’m guessing a reasonable chunk of the game sale goes toward paying off the 5 year development costs, depending how much NCsoft let ArenaNet keep from the GW1 days. Now I’ve read that F2P MMOs are aiming at 10% of their active player base to drop $15 a month in the store to be considered very successful. I expect that’s the plan here as well. A rising exchange rate helps that.

Digging through some EVE data, PLEX, their method of converting real money into ingame currency, was worth 325 million ISK at the start of 2009, it’s around 500 million right now and I believe they use a straight up market place to set the exchange rate. So inflation happens there as well and it’s entirely in the players control.

I believe the Gem Store and the Currency Exchange are different. One you buy directly from Anet, while the other you make constant flows of exchanges at a floating rate via pots of Gems and Gold.

John Smith.4610:

I’m curious, assuming the argument that a 20% discount should apply to the gem exchange rate (I think people here have done a good job of explaining why the sale isn’t a sale on the exchange, so lets leave that be). What system do you use to create a moving 20% discount on exchange, keeping in mind that the supply of gems is not unlimited, and that the exchange does not fabricate gems?

The bolded part suggests that as the gold-to-gem rate increases so will the price exchange since we have a limited supply of gems and thus moving closer to the supply limit.

So in other words, ANet needs to adjust the exchange rate price so that a) the economy has supply of gems for continuous exchanging and b) so hat ANet does not have to add more gems to the economy.

Now going back to the apple and oranges comparison.

Real money to gem = oranges
Game money to gem = apples

In terms of exchange both are fruit and round but the difference arrises with regards to the % OFF sale price which makes this not a real comparison becaue they are DIFFERENT fruit. As was stated before, the main purpose of the sale specials is to attract more real money to gem conversion, and that is fair enough. I still feel ripped off though and you would be surprised how often this occurs in real life (i.e. price before and price during speicals nto actually equating to the % OFF difference).

I read about the discount and got in the game.
I thought why not.
I can spare a few gold for a couple more bank tabs.
Opened the bltc page.
Tried to convert gold to gems.
The rate was 1 gold for 45 gems.
1 bank slot cost is 480 gems.
Closed bltc.
My bank space is great,no need for new slots;)

Smooth Penguin.5294:

I believe the Gem Store and the Currency Exchange are different. One you buy directly from Anet, while the other you make constant flows of exchanges at a floating rate via pots of Gems and Gold.

Yes I know but Gems are only created on RM purchases (via Anet or Gem card) and destroyed when spent in the store. If they are used at the exchange to convert into gold, they are added to the exchange’s supply of Gems. We simply don’t have any idea about the size of the Gem pool at the exchange and how much it fluctuates by, at least directly. We can only infer pool fluctuation by the exchange rate.

Behellagh.1468:

Smooth Penguin.5294:

I believe the Gem Store and the Currency Exchange are different. One you buy directly from Anet, while the other you make constant flows of exchanges at a floating rate via pots of Gems and Gold.

Yes I know but Gems are only created on RM purchases (via Anet or Gem card) and destroyed when spent in the store. If they are used at the exchange to convert into gold, they are added to the exchange’s supply of Gems. We simply don’t have any idea about the size of the Gem pool at the exchange and how much it fluctuates by, at least directly. We can only infer pool fluctuation by the exchange rate.

My mistake. I misread your post.

The problem with that approach is they would almost instantly lose any credibility with reasonable folk about whether or not they are influencing the gem rates.

I don’t care about their credibility on influencing the Gem rates. I think they are the only ones that do. What people want is cheaper Gems, ANet can provide that, they choose not to. I want them to manipulate the gem market if it results in cheaper gems, I don’t want them to not manipulate the gem market if that inaction results in more expensive gems.

Think of it this way. The government can print as much money as they want, that doesn’t mean your bank account has access to that money. The currency exchange does not have access to gem creation. It has a limited stock that players add and subtract from.

But only because you choose to have it that way. I’m sure there is some way that ANet could just change the variable that contains the amount of gems contained in the store, and even if you did for some crazy reason create it as some sort of untouchable black box, you still always have the option of “buying” $10,000 in gems using ANet’s own credit card, dumping those gems into the market, and then having those costs immediately returned, since you’re basically just buying them from yourself.

Yes, people want cheaper gems, but Anet is not going to dump gems into the currency exchange.
The cheaper gems from that are going to impact its ability to sell gems to players for money, which is kind of important for its continued survival. You’re effectively asking ANet to shoot one of its main ways of making money in the foot.

I have very limited money and all the reasons given as to why ANET have not tricking anyone I understand. This uncertainty about gem to gold conversion the rng nature of a lot involving this game stops me from enjoying myself fully. I need to know what I spend and have to be very careful. Its a shame this game to me is a gamble and that should not be the case.

White Knight.3925:

O.K., Arenanet is hyping the February patch by putting a sale on bag slots and bank tabs. Awesome. Only one problem – the conversion cost for gold to gems just skyrocketed. Now you’ve just kitten off a lot of players who want/need gems for other things and the people who would take advantage of the sale get screwed because their “savings” are eaten up by the gouging in currency transfer.

Could you not have frozen the conversion cost before the change? Sheesh! Only Arenanet could screw up a free lunch!!!

Thanks, but no thanks, Arenanet.

The promotion is not about reducing “gold for bank slots” — it’s about reducing gems for slots. Make a habit of setting aside some money for gems regularly:

• It will allow you to take advantage of sales like this, without losing out to higher demand for coin-bought-gems.
• It will allow you to purchase luxury items at less than market value.
• As a hedge against the inevitable inflation in other parts of the game. Gems should track pretty well, on a month-to-month basis.

Yes, people want cheaper gems, but Anet is not going to dump gems into the currency exchange.
The cheaper gems from that are going to impact its ability to sell gems to players for money, which is kind of important for its continued survival. You’re effectively asking ANet to shoot one of its main ways of making money in the foot.

Honestly, what I’d prefer even more is that they remove the gem exchange entirely, make cash money the only source for gems, but then make gold much more available, and higher priced items drop much more often, so that it’s much easier to get stuff, without risking that everyone would be able to buy all their Quagan backpacks using gold.

Ohoni.6057:

Yes, people want cheaper gems, but Anet is not going to dump gems into the currency exchange.
The cheaper gems from that are going to impact its ability to sell gems to players for money, which is kind of important for its continued survival. You’re effectively asking ANet to shoot one of its main ways of making money in the foot.

Honestly, what I’d prefer even more is that they remove the gem exchange entirely, make cash money the only source for gems, but then make gold much more available, and higher priced items drop much more often, so that it’s much easier to get stuff, without risking that everyone would be able to buy all their Quagan backpacks using gold.

You might as well just ask Anet to deposit a Precursor into everyone’s bank. Doesn’t get easier than that.

Supply and demand. Nothing much else to it really since there isnt an infinite number of gems in the exchange.

anyone else bought the bank slot expansion and didnt get any mail with that item ?
my gems disappeared, I can see it in “recent purchases” tab but no item neither gems..
what do I do ?

Is your mailbox full?

yea, it showed up that deleting some mails fixed it.. I didnt notice that my mailbox was full.. couldnt see any notifications.. sorry for this

You might as well just ask Anet to deposit a Precursor into everyone’s bank. Doesn’t get easier than that.

/second.

Supply and demand. Nothing much else to it really since there isnt an infinite number of gems in the exchange.

Again though, that’s ANet’s choice too. You can’t just say “supply and demand” as if ANet has no control over either. They have EVERY control over both. They control the supply. They created a system in which a certain amount of any given item is generated over time. If they wanted to lower the price of precursors, all they’d need to do is keep raising the rate at which they drop into the world. If they want to reduce the demand for precursors, then they could just add better ways of acquiring them, or even skipping them entirely in the Legendary process. They could even choose to make desirable materials far less in demand simply by reducing the number needed for most recipes.

Yes, it is supply and demand, but that phrase in no way absolves ANet for the state of the economy.

This complaint is just ridiculous. Seriously … Imagine in real life some item price is listed in USD and has discount 20% . Now u live in country with other currency with no fixed conversion rate. What will happen when u will try to buy that item in different days, will you get same discount every day ? Ofc NO !, Your real discount will fluctuate depending on actual conversion rate, BUT that doesnt mean that item isnt still discounted 20% in its listed currency.

What I don’t understand is why the standard supply and demand curve doesn’t apply to the non-cash gem market. Maybe I’ve missed something so if I’m wrong here, someone enlighten me.

The gold to gems and gems to gold markets shouldn’t rise together, according to standard supply and demand models. John Smith says there is a finite amount of gems (most likely gold to gems) which should demonstrate that if we’re sucking the gems out of the “finite” gem pot (with gold), the price for gems to gold should drop. Obviously this isn’t happening so the cash to gems market does cause the “finite” gem market to fluctuate. If this is truly the case then the adjustments made to the cash to gems market should affect the gold to gems market and vice versa, but this isn’t happening. Both are on the rise and not with any parity that I can see.

The issue I have is that, while I’m not ultimately concerned with the exchange rates, brand new gamers who pick up their first copy/licence to play are being put out by this outrageous market. ANet needs to adjust some calculations or artificially adjust the exchange market to keep it fair. At the rate we’re going those gamers who don’t have access to cash may never buy anything from the market. Even those of us who do cash to gems aren’t seeing a real win here either as the gems to gold market is also poorly orchestrated.

WarChild.4780:

The gold to gems and gems to gold markets shouldn’t rise together,

Why shouldn’t they?

WarChild.4780:

we’re sucking the gems out of the “finite” gem pot (with gold), the price for gems to gold should drop. ,

It does though. When players convert gold into gems, the amount of gold you can get for the same amount of gems increases. So the prices for getting gold with gems is decreasing.

WarChild.4780:

What I don’t understand is why the standard supply and demand curve doesn’t apply to the non-cash gem market. Maybe I’ve missed something so if I’m wrong here, someone enlighten me.

The gold to gems and gems to gold markets shouldn’t rise together, according to standard supply and demand models. John Smith says there is a finite amount of gems (most likely gold to gems) which should demonstrate that if we’re sucking the gems out of the “finite” gem pot (with gold), the price for gems to gold should drop. Obviously this isn’t happening so the cash to gems market does cause the “finite” gem market to fluctuate. If this is truly the case then the adjustments made to the cash to gems market should affect the gold to gems market and vice versa, but this isn’t happening. Both are on the rise and not with any parity that I can see.

The issue I have is that, while I’m not ultimately concerned with the exchange rates, brand new gamers who pick up their first copy/licence to play are being put out by this outrageous market. ANet needs to adjust some calculations or artificially adjust the exchange market to keep it fair. At the rate we’re going those gamers who don’t have access to cash may never buy anything from the market. Even those of us who do cash to gems aren’t seeing a real win here either as the gems to gold market is also poorly orchestrated.

I really don’t understand what you said.

Think of gems as a commodity, like for example Dusk. The less Dusks there are the more each one costs. If you want a Dusk you pay lots of gold. If you have a Dusk it sells for lots of gold.

Gems work the same way. As the pool of gems gets smaller there are less gems so each one is worth more gold. If you want gems you pay lots. If you have gems you sell it for lots.

I really really don’t understand why this system is so hard for people to comprehend. Odds are the algorithm they use is something like:

(Original Number of gems in the exchange) \ (Number of gems in the exchange) + (base price) = (Gem price)

Suppose there were 5,000,000 gems in the beginning when gems cost 20 silver per 100 gems (spidy is down and I’m pulling that number from memory) so that’s 20 copper per gem (base price would be 19 copper in this example).

So it looks like this:
5,000,000 / 5,000,000 + 19 = 20 (20 * 100 = 2,000 copper/100 = 20 silver)

Suppose there’s only 200,000 gems left in the exchange:
5,000,000 / 200,000 + 19 = 44 (44 * 100 = 4,400 copper/100 = 44 silver)

Obviously in this example the price wouldn’t get very high unless the number of gems got ridiculously low. If however the initial supply was 5,000,000,000 instead with 200,000 left:

5,000,000,000 / 200,000 + 19 = 25,019 (that’s 2.5 gold per 100 gems).

Then there’s the formula for whatever selling gems gets you which would just be X% of the gold -> gem price. I can’t remember what the variation is but that’s obvious stuff anyway.

I’m sure they probably have a slightly more complicated system but that simple formula would produce something roughly equivalent to what they have now. There would be a set minimum price (19 copper per gem) and a price that is perpetually changing based solely on the amount of gems in the exchange at the exact moment of purchase.

Edit: Obviously there would have to be more variables to account for the exponential inflation that would occur at extremely low gem values (like 5 gems left gives 1,000,000,019 or 100,000 gold per 100 gems) and to avoid the dividing by zero if the exchange ever ran out. A simple cap on price and some code that boils down to “If number of gems in exchange is greater than 0 fetch price. If number is 0 return <insert message saying no gems available>” would work but my guess is they use a much more complicated algorithm that just operates in roughly the manner I described.

Edit 2: [X / (Y + Z) + N] should produce roughly the right results.
X = Original number of gems
Y = Current number of gems
Z = A constant to prevent exponential inflation at low values of Y also effectively putting a cap on the price. Also avoids dividing by zero.
N = Base price

I always keep 5-6k in gems in my bank for sales and events i can usually get about 51-53 gems for every 1g during the quiet times.

John Smith.4610:

As a quick aside. Gems in the currency exchange are finite. You may buy gems with real money to your hearts content, but if you don’t put any of them gems into the currency exchange the currency exchange’s stock of gems never changes.

This kind of blows because with the current gem-to-gold rate, the gold-to-gem stock will never go down, it can only rise as inflation slowly kicks in.

Ursan.7846:

WarChild.4780:

The gold to gems and gems to gold markets shouldn’t rise together,

Why shouldn’t they?

WarChild.4780:

we’re sucking the gems out of the “finite” gem pot (with gold), the price for gems to gold should drop. ,

It does though. When players convert gold into gems, the amount of gold you can get for the same amount of gems increases. So the prices for getting gold with gems is decreasing.

If there truly was a finite amount of gems in the non-cash gem market then the laws of supply and demand would dictate that as the supply of gems gets low and demand increases so will the price. Since gold is the currency exchanged then the supply of gold would increase and demand decrease. This should inversely cause a drop in the gems to gold conversion. This isn’t happening as these two markets rise and drop in an almost identical fashion, save for the 40-50 silver difference.

WarChild.4780:

If there truly was a finite amount of gems in the non-cash gem market then the laws of supply and demand would dictate that as the supply of gems gets low and demand increases so will the price. Since gold is the currency exchanged then the supply of gold would increase and demand decrease. This should inversely cause a drop in the gems to gold conversion. This isn’t happening as these two markets rise and drop in an almost identical fashion, save for the 40-50 silver difference.

You’re looking at the perspective of Gold. The exchange isn’t tied to the supply of gold, it’s tied to the supply of Gems. Gold isn’t limited, but Gems are.

Refer to my previous post. If people are converting Gold > Gems, the value of gems increase due to a lessening of the supply of Gems. Gems become more valuable, hence you can get more Gold with the same amount of Gems.

EDIT: Actually I’m kinda confused from what perspective you’re approaching it. Your first sentence is correct. Do you mind clarifying your second sentence?

Exchange was founded with two very large piles, Gems and Gold. These piles are fixed and only change when players use the Exchange. This pile of Gold is separate from the general money supply in the economy.

The ratio we are talking about is Gold/Gems. When you buy Gems the Gold pile increases while the Gem pile decreases. Either movement on their own would increase the exchange rate, those movements together will compound the effect. When you sell Gems the opposite occurs, the Gem pile increases while the Gold pile decreases. Again individually or together those changes will decrease the exchange rate.

As for the spread between Gem->Gold and Gold->Gem, what we don’t know is if the difference between the two exchange rates is a “fee” and that difference is destroyed as a Gold sink or if the difference is used to increase the Exchange’s gold pile thus forcing the exchange rate to creep up, hopefully at a rate similar to the general gold supply in the game.

White Knight.3925:

O.K., Arenanet is hyping the February patch by putting a sale on bag slots and bank tabs. Awesome. Only one problem – the conversion cost for gold to gems just skyrocketed. Now you’ve just kitten off a lot of players who want/need gems for other things and the people who would take advantage of the sale get screwed because their “savings” are eaten up by the gouging in currency transfer.

Could you not have frozen the conversion cost before the change? Sheesh! Only Arenanet could screw up a free lunch!!!

Thanks, but no thanks, Arenanet.

I’d like to expand my bags ahem – but if the advertised discount is immediately negated, then I’m not going to do it.

So anet do a sale to help people and you still whinge, grow up………….Anet dont bother with anymore sales its to much hassle just charge full price