Guild Wars 2

This may seem like a strange question, I know.

So, we just finished going through the yearly audit at work. While driving in this morning my wife and I were discussing the gem economy, and with the audit still fresh in our minds the question came up: does anet have to reconcile the gem economy through audits? It would help to ensure everything is above-the-board with conversions from gold:gems & gems:gold, and show that anet isn’t taking a tax on either side.

If anet does use auditing, is it in-house or third party? how does that factor into taxes? does the gem economy create enough work for people to reconcile its impact on the budget?

Generally budgets and taxation are boring subjects, but considering this involves a digital currency which can be bought and sold for real life money and/or in-game coins created from killing fake birds and monsters… that’s kind of cool and interesting.

What? Who do they need to audit it for?

The conversion from gold to gems, or gems to gold is supposed to be done on a fluctuating economy, but at a 1:1 rate depending on whatever the current market price may be for gems. Auditing would show that anet isn’t taking a tax on either side of that just to keep the market range within the limit they find acceptable.

They have set it so that gems to gold is always less than gold to gems. It is a fixed percentage. If for some reason you have objections to in game conversions take it up with support. They have no need nor desire I am sure to go through an audit of a automated system.

Anet, and players, do not get taxed in real life on virtual currency made.

Yargesh.4965:

They have set it so that gems to gold is always less than gold to gems. It is a fixed percentage. If for some reason you have objections to in game conversions take it up with support. They have no need nor desire I am sure to go through an audit of a automated system.

My post was entirely inquisitive and not aggressive or condemning of their system. I don’t know how you came about believing that I may have a problem with what anet’s doing, but I assure you that I do not.

nickhimself.2739:

Yargesh.4965:

They have set it so that gems to gold is always less than gold to gems. It is a fixed percentage. If for some reason you have objections to in game conversions take it up with support. They have no need nor desire I am sure to go through an audit of a automated system.

My post was entirely inquisitive and not aggressive or condemning of their system. I don’t know how you came about believing that I may have a problem with what anet’s doing, but I assure you that I do not.

I am unsure because you are asking for an audit (which corporations and companies need under law to do) for an in game system run by the company involved. They legally need to have a yearly audit since they are an incorporated company any income or expenditures need to be checked and the basics released publicly. An internal audit of systems to make sure they are running the way they should be would be a standard practice. No where would these data be released so even if they do, do it regularly neither you nor I would have a clue. So to sum up it is a strange question.

1. What would you be looking for in an audit?
2. What actions could be taken if you found something?
3. Who would take that action?
4. What would be the value of adding this layer of compliance to the game system?

Hi Nick…

The answer to your opening question is a simple no.

No audit/reconciliation of gold/gem transactions because as the other posters explained its a fixed and self regulating automated system. For every x gems put into the pool by players y gold is redistributed by the system and vice versa. New gem purchases create new gems but still draw on the existing gold pool to buy those gems when converting.

The exception is where gold is removed from the system by Anet as a result/penalty of off book RMT purchases from outside. That removed gold ceases to exist rather than being fed back into the pool – with a consequential shift in conversion rate for gems.

This has been covered in other forum threads over the years and is kind of intuitive once you think it through.

I appreciate what you were trying to convey, so does Evan Gnashblade the CEO and Chief Operating Officer for Black Lion Trading Company – but from his perspective no-one sees the Books, except him and those mysterious BLT clerks who never seem to have family or relatives and who seem to be on very short contracts.

Breeze

[EDIT: Since Anet carries out regular ‘block’ deletions of RMT/Goldseller accounts, watch the exchange rates over time and see if you too can spot the moment these happen -it does register since goldseller proxies generally hold large amounts of gold and removing that much once a month (or whenever) is measurable for impact].

nickhimself.2739:

It would help to ensure everything is above-the-board with conversions from gold:gems & gems:gold, and show that anet isn’t taking a tax on either side.

That would be hard, seeing as they do take a tax on conversion, and aren’t hiding it (it’s 15% for either, the same as TP tax, if i remember correctly).
(seriously, if they didn’t, the gem to gold and gold to gem prices would have been the same)

Also, who and why would they need audits for? I mean, besides someone checking that everything works as designed, which they definitely do (i believe JS is doing exacly that).

Astralporing.1957:

That would be hard, seeing as they do take a tax on conversion, and aren’t hiding it (it’s 15% for either, the same as TP tax, if i remember correctly).

It used to be 15% in each direction. It’s been closer to 18% in each direction for the last year or so (varying a bit), based on looking at the API’s rate of exchange.

Astralporing.1957:

(seriously, if they didn’t, the gem to gold and gold to gem prices would have been the same)

Right, plus, people would convert gold to gems when the rate dropped a little and then convert back to make a profit, which would allow profiteering every time the gem shop added something new.

Gems for the most part are only created when they are bought with cash (I think there is a gem reward in a large achievement chest).

Now the exchange has been explained as a repository of gold and gems. The relative ratio of these two items determines the exchange rate, adjusted by whatever gold tax ANet applies to the transaction. The gold paid by players to buy gems is the gold other players are buying with gems and vice versa. This way no gold or gems (other than the start of the exchange) paid out by the exchange is created out of nothing by the exchange. Gold is earned in game while gems are bought with real world currency. Gems are only destroyed when spent in the Gem Shop, the exchange only destroys, via the tax, gold.