|S.MG incoming and outgoing|
|Copper salei||10.0||Game server||2.28232957|
|Loot pool provisioningii||0|
|Intangibles and goodwill||69.162325217||0||69.162325217|
S.MG has a total of 88`096`605 authorised shares outstanding. The shareholder equity per share implied value is thus 0.000099648 BTC.
S.MG has Special Stock Warrants outstanding, as follows :
Provisional statement, will be considered accepted within 24 hours. Make any observations or corrections below.
A sad point of reporting is that our CTO has sustained some back injuries and is out on leave. This has reduced and is likely to in the future continue to reduce our speed of development. Please pray for her speedy recovery, the woman is irreplaceable for S.MG at this juncture.
In unrelated news, to comply with PR's injunction that I must always include visuals, I give you some random shots.
- I bought all of it.
I want to point out that this isn't book padding from me-as-S.MG-ceo, but actually legitimate expenditure from me as Eulora player. Currently the situation in game is that Grenadine and Daniel share control of the Faith line ; Daniel and Foxy share control of mining (many other people mine, myself included, but these two have Gathering in the 400 range - mine is barely 200ish) ; whereas I singlehandedly dominate Tinkering (just made 600), McGuyver, Gungho Gumbo and perhaps also Bouquinism. Consider that a single click on the Maculature (basic Bouq craft) well loaded is 100k coppers, consider that I went through upwards of 50 samovars and toolkits in less than a month, consider that I'm spending millions each day to populate my inventories - and consider how vast those inventories have to be to cover so much ground. Just to "wet the pipes" as it were one needs tens of millions (and wetting there will be, because the craft processes are complex and you'll always be left with odds and ends, leftovers from the interplay of various considerations).
The fact of the matter is that if I craft I go through ~10mn worth of material a day. If I can't craft and I mine I go through maybe 3k CFT or so, which together with the LBN and tools involved and not counting any skill training expenditures readily comes to ~5mn as well. Keeping 30 to 60 days' worth of stocks strikes me as well reasonable, and so here we are.
That said, I expect this much to last me at very least the year. [↩]
- No further provisioning this month. I remain ever watchful.
Considering the significant increase in mining brought about by the release of Foxy's bot as well as by increasing play time / playerbase, I expect that either this coming month or the next we will be expending more BTC to thicken the loot pools of Eulora. [↩]
- We made an even smaller than last month's gain on player activity this month. [↩]
- The nominal (ie, what merchant pays) of all owned items plus cash held. The value of skills is nominally 0. [↩]
- The reason our income of BTC 10 is only partially reflected in an increase in Player holdings, far beyond what the small movement in Tangibles can account for is principally the wild success of the Oct 25th auction.
I would like to take this opportunity to discuss the twin matter of inflation and deflation in Eulora, or in more proper terms the regulation of Eulora coppers as monetary supply.
Obviously, like any other virtual currency (which is to say : a currency without objective value, created simply through alteration of computer records), such as the US Dollar, the Euro scl, the Euloran copper derives its market value from some sort of relation to the mass of goods and services it may be exchanged for, which market value is then assigned some sort of numeric price, in terms of another currency. To keep this discussion not just simple but more importantly sane, we will not compare this fiat with any other fiat, but instead limit ourselves to considering the relationship between Eulora coppers and the only currency of actual objective value known to date : Bitcoin.
There exist two major infrastructural supports that allow discussion of Eulora coppers (let's call them ECU for short) in terms of Bitcoin. One is that S.MG sells (to preferred traders - let's call them EPT) ECU at the rate of 1 ECU per satoshi ; the other is that every actual item in Eulora has a "merchant value", which is to say a value at which S.MG is willing to purchase it from players. This obviously does nothing for services, just actual items, and obviously does not capture very correctly the market's / players' evaluation of value as proceeding from utility scl, nevertheless, it is an indication. On this basis, the current base value of all items in game is 721`234`084 ECU, which as per the previous consideration would be equivalent to no less than 7.21234084 BTC.
There also exists an incidental, which works to drive ECU out of the Euloran economy while at the same time increasing the material base : the occasional auctions. To take as an example the most recent one, goods worth in total 180 coppers were sold to the highest bid of 250k coppers. This means that the total ECU mass reduced by 250`000, while at the same time the item base increased by a nominal 180 ECU. How much it increased in real terms is an open matter, but obviously at least one player evaluated that increase at 250`000 ECU's worth. It is possible that player will be able to use these to create a profit (so, goods of even more value than the 250`000 ECU in cash), or maybe not. In either case, the volume of currency has decreased, and the volume of goods available to match that currency has increased. This situation is exactly deflation, in Eulora terms.
At this point in our discussion, we must make a distinction between proper inflation, so to speak, which is the situation where ECU are created with no correspondence to actual Bitcoin values ; and monetary inflation, which is the situation where ECU are created with correspondence to Bitcoin values, through the process of players buying coppers from EPTs, while the item base remains unchanged. It should be obvious that while proper inflation degrades the value of ECU as well as of in-game items in terms of BTC, monetary inflation mostly increases prices of Eulora items in ECU but doesn't do much more than this. (Given truly catastrophic imbalances to the degree of, there existing say a single item in the entire world it would probably ruin the game altogether, but S.MG guards against this situation - which is the main reason the auctions even exist in the first place, to impede serious bottlenecks in the suppliance of needed items - and players probably can be relied on to a large degree to do the same thing on their own account, with the caveat, of course, of mass hysterias that have in the past driven various asset bubbles throughout history.)
With this discussion, we are equipped to try and model the evolution of Eulora's economy. It should go like so : every time someone buys ECU from an EPT, that someone is driving monetary inflation but not proper inflation of the ECU. Should someone sell their ECU at a price lower than what EPTs demand, which is to say they're destroying Bitcoin demand for ECU, the difference between what they charge and what the EPT would have charged constitutes proper ECU deflation. Meanwhile, should EPTs sell ECU cheaper than one to the satoshi, this would signify that the ECU is properly inflated, probably by a percent equal to the discount offered. (Logically, if S.MG issues a billion ECU tomorrow without taking in a further 10 BTC, the inflated mass of ECU would probably slosh around, eventually try to come back out, at which point it would undercut the EPTs by something like 30-40%, at least if we credit the efficient markets hypothesis. While S.MG has no intention to do such a thing, it should be noted that undiscovered or unreported bugs with economic relevancy would have the same exact effect.)
As the players play, whenever someone realises a net loss (say by expending three million's worth of tools/materials to obtain two million's worth of product) that someone paradoxically is driving proper inflation : there are fewer goods chasing the same volume of ECU as before. Meanwhile for someone realising a net gain (say by striking it big) then the converse is true : their lucky find is actually driving proper deflation! So paradoxically the luckier the players are the more valuable everyone's coppers (in game terms), which shouldn't really be a surprising result.
Irrespective of player's individual or players' collective good or bad luck, the discussed mechanisms still ensure a balance between inflation and deflation, both proper and monetary. Specifically : if monetary inflation heats up, players are disincentivised from buying more ECU, because there's little to do with it, and they are also incentivised to participate in the Sunday auctions, which deflate the ECU in BTC terms. Conversely, should monetary deflation seize up, players are incentivised to buy more ECU, and simultaneously the prices of auction items should drop (perhaps especially in terms of % - with the caveat that one has to compare like things, in which sense the increase seen over the last two auctions is not necessarily indicative.)
If proper inflation heats up, players are incentivised to undercut the EPT, which should make the problem very visible - EPTs can be said to play the role of a sort of canary on this very delicate, and very important, matter (as per expert testimony ECU / BTC pair trades currently at 1:1 both ways) - while should real deflation seize up, players would be incentivized to buy more ECU for BTC. It is for this reason that simple volume of ECU-BTC exchange is a poor indicator of health - all we know is that players perceive deflation, but we don't really know which kind, and the kind is rather important.
Historically there existed a fourth mechanism - Electron Spirover's stocks, providing a fixed price mechanism to transform ECU into goods. This was planned to be discontinued as the game matures, and the expected indicators being reached it was discontinued. Eulora currently - and for more than a month now - enjoys the very unique distinction of running a single-tether game economy, a situation in which I take deep satisfaction. Realise that should the last tether ever be severed Eulora will in point of economic fact be a country, no less so than any other could ever hope to be - not exactly the smallest of matters. [↩]
- Deceleration discussed last month seems to be continuing. [↩]