An open letter to SL financial institutions and operators (From VSTEX)

We've seen the bans and the policies changes from Linden Lab, the
widespread financial scandals and all the many issues every stock
market has faced.

Right now, the financial sector is in a situation where every stock
exchange will stand up once every while presenting its achievements and
successes to the general public, a situation where we can still find
businesses willing to go public and launch their IPO, a situation where
some people will give a try at reviving public shells, or giving a
continuity to endangered companies.

We could go on like this for an undefined amount of time; months,
years. By operating in Second Life we're bound to Linden Labs and their
policies changes. At this point one could bring up other synthetic
worlds, but this won't be the main topic of this open letter.

Following up with the many issues we've had to deal with and using
our foresight, the VSTEX has been growing strong as a SRO
(Self-Regulatory Organization), with an extensive set of rules and
policies modeled after "real life" stock market rules, policies and
laws. That was a due answer to issues, but far away from being a
complete solution for the whole SL financial sector.

As far as we can see it, current SL stock exchanges and companies
trying to go public are fighting over a limited set of resources. There
could be way more money circulating in SL finances and one can't blame
it all on the gambling and banking bans, or other policies changes from
Linden Lab.

The current situation reminds us of the Italian city states we had
in our country (the VSTEX was born and operates in Italy), before the
Italian Renaissance. Right now every exchange is an independent entity;
methods, procedures, regulations are not common and can vary a lot from
exchange to exchange. Every exchange is like a city state.

It's our belief that such a situation is detrimental for a thriving
financial sector. It adds to people (businesses, investors and so on) uncertainty, it doesn't help with building overall confidence.

As written earlier, we could go on like this for an undefined
amount of time, even for a long one. Still, it is about time to be
proactive about restoring and improving investors confidence.

Even in the recent past some attempts have been made. We can recall
courses for investors, businesses and in the not so recent past, a
regulatory body. In the long run, all of the attempts made have failed
to achieve solid results.

What about the options left then? We believe there's at least one
path never tried before and it may be worth some efforts from every
organization operating in the SL financial sector.

The VSTEX would like to promote an open consortium working on
methods, procedures and guidelines for stock exchanges, financial
institutions at large, public companies.

This new entity shall be an international consortium where Member
organizations and the public work together to develop standards.
Consortium's mission shall be:

To lead the SL financial sector to its full potential by
developing protocols and guidelines that ensure long-term growth for
the sector itself.

The Consortium shall primarily pursue its mission through the creation of
standards and guidelines.

The Consortium shall also engage in education and outreach, promote
business ethics, and serve as an open forum for discussion about the SL
financial sector. In order for the SL financial sector to reach its
full potential, the most fundamental rules and policies used by
financial institutions must be compatible with one another and allow
easy understanding while facilitating the circulation of capitals. The
Consortium shall refer to this goal as “financial markets
interoperability.” By publishing open (non-proprietary) standards for
rules, policies and protocols, the Consortium shall seek to avoid
market fragmentation and thus fragmentation of the whole SL financial
sector.

This is the general idea of our vision for an open consortium,
which won't be a regulatory body issuing fines or statements against
members or third parties for non compliance. The Consortium shall be a
place where people meet and work on common, shared frameworks for rules
and policies.

We believe that some degree of standardization will do wonders and
it's time for the SL financial institutions to get our of their "city
state" and work together for the greater good of everyone.

The Consortium shall be a group where all Members are equal. Also,
for institutions looking to reach out for new synthetic worlds, the
Consortium shall be a foundation to start with the right foot into new
ventures.

Now that our proposal has been thrown to everyone, we'll be waiting
for feedback. We'll try to follow up on the many forums and websites,
making at the same time our email communication@vstex.net available for
this special purpose.