In
crypto
–
especially
in
the
category
of
blockchain
interoperability
–
we
think
a
lot
about
fragmented
currencies:
ETH
providing
security
across
multiple
layer-2s;
USDC
in
multiple,
non-fungible
wrapped
versions
(abcUSDC,
xyzUSDC).
So-called
real-world
assets
also
experience
similar
fragmentation:
a
dollar
in
your
pocket
is
not
the
same
as
a
dollar
in
the
bank.
Take
gift
cards.
You’re
probably
holding
a
few
after
the
holidays
and
if
you
are,
you’re
not
alone.
A
Bankrate
survey
earlier
this
year
estimated
$23
billion
is
sitting
in
unused
gift
cards
across
the
US.
That’s
about
0.1
percent
of
the
M2
money
supply.
Stripping
away
the
colorful
plastic
packaging,
gift
cards
are
a
number,
some
16
to
30
digits
in
length,
that
provides
access
to
a
digital
equivalent
of
cash.
They’re
somewhere
between
cryptocurrency
and
a
debit
card:
not
as
secure
or
uncensorable
as
bitcoin
or
ether,
but
you
don’t
need
a
bank
account
to
use
them
and
they
can
be
bought
and
sold
with
minimal
information
exchanged.
This
opens
up
some
interesting
wrinkles
in
the
world
of
commerce
on
the
internet,
one
of
which
I
recently
stumbled
upon,
involving
metaverse
activities
and
unbanked
members
of
my
household.
The
Fortnite
V-Bucks
Gift
Card:
The
Worst
UX
in
Payments?
I
have
teens
and
tweens
in
the
house
and
that
means
I
deal
in
metaverse
currencies,
specifically
Fortnite
V-Bucks.
The
in-game
currency
is
Fortnite
publisher
Epic
Games’
main
vessel
for
turning
FOMO
into
dollars.
For
young
players
of
Fortnite,
the
metaverse
of
Web3
and
$META
hype
is
here
today:
the
game
really
is
a
“third
place.”
The
virtual
goods
(“skins”)
that
signify
status
or
identity
in
Fortnite
can
be
just
as
crucial
as
any
clothes
or
accessories
available
in
real
life.
The
result
is
a
steady
stream
of
requests
across
my
phone,
accompanied
by
a
wrinkled
bill
or
a
CashApp
transfer.
I
fulfill
the
requests
by
adding
dollars
from
my
credit
card
to
the
Microsoft
account
for
Xbox
in-game
purchases.
The
kids
are
playing
Fortnite,
and
I’m
playing
my
favorite
game,
which
is
a
text-based
roleplaying
game
called
Web2
Payments.
V-Bucks:
Default
transaction
flows
for
unbanked
tweens
I
play
Web2
Payments
almost
daily
in
one
form
or
another.
But,
the
other
day,
one
of
my
kids
found
a
workaround
that
cut
me
out
of
the
flow:
the
Fortnite
V-Bucks
gift
card.
The
V-Bucks
gift
card
is
available
at
many
retail
stores.
My
kid
bought
one
with
physical
cash
and
thought
they’d
been
scammed.
The
gift
card
was
legit,
it
turned
out,
but
the
process
for
converting
it
into
in-game
currency
wasn’t
an
ideal
end-around
to
parental
capital
controls.
It
was
too
complex
for
anyone
uninitiated
in
the
art
of
internet
search
queries.
The
in-game
form
for
entering
a
V-Bucks
gift
card
requires
a
16-digit
code.
But
the
code
on
the
back
of
a
physical
V-Bucks
gift
card
is
25
digits.
No
explanation
is
given
–
not
on
the
card,
not
on
the
in-game
form.
A
search
reveals
a
separate
webform,
where
a
25-digit
gift
card
code
can
be
converted
into
the
16-digit
code
that
the
game
requires
–
after
logging
in
with
a
player
account.
If
you
happen
to
log
in
with
the
wrong
account,
there’s
no
way
to
transfer
the
V-Bucks.
I’ve
worked
in
the
cryptocurrency
industry
since
2017
and
for
the
past
couple
of
years
I’ve
focused
on
cross-chain
interoperability.
Let’s
just
say
I’m
no
stranger
to
bad
user
experience
–
but
the
convoluted
UX
for
converting
V-Bucks
gift
cards
into
in-game
currency
surprised
me.
Gift-Card
Fraud
Vs.
Cryptocurrency
Fraud
The
crux
of
the
bad
V-bucks
gift
card
UX
is
simple:
it
requires
a
login
on
a
third-party
site.
This
could
be
more
seamless
with
better
instructions
or
an
integrated
form,
but
the
need
for
the
login
seems
pretty
obvious.
It
prevents
fraud
and
money
laundering.
Bitcoin
and
ether
have
no
similar
constraints,
making
them
more
apt
for
extralegal
uses
ranging
from
laundering
the
proceeds
of
fraud,
to
funding
dissident
movements
in
Hong
Kong,
to
escaping
capital
controls
in
Turkey.
Regulated
entities
layer
similar
anti-money-laundering
(AML)
measures
atop
the
Bitcoin
and
Ethereum
networks.
Just
like
a
V-Buck
on
a
gift
card
is
not
the
same
as
a
V-Buck
in-game,
bitcoin
on
the
Bitcoin
network
is
not
the
same
as
bitcoin
in
your
Coinbase
trading
account.
It’s
entertaining
to
imagine
a
world
that
isn’t
like
this.
Dark-web
deals
in
the
Fortnite
metaverse
sounds
like
a
good
wrinkle
in
a
Charlie
Stross
novel.
But
in
my
opinion
it
would
not
improve
the
game
–
any
more
than
Coinbase
would
be
improved
by
less-restrictive
access.
An
all-too-real
“Grand
Theft
Auto”
is
not
what
most
people
want
in
their
metaverse.
Even
if
Fortnite
did
turn
into
a
channel
for
gift-card
fraud,
it
would
probably
be
the
virtual
tip
of
an
iceberg-sized
illegal
business
done
via
gift
cards
in
much
more
mundane
locations,
like
Home
Depot
parking
lots
and
your
online
bank
account.
U.S.
Federal
Trade
Commission
data
on
gift-card
scams
show
they
increased
from
$180
million
in
2021
to
$228
million
in
2022
–
but
that’s
just
vanilla
scams,
duping
people
into
buying
and
sending
a
gift
card
as
payment.
The
real
world
of
gift-card
scams
is
much
more
varied
and
colorful.
It
involves
alleged
fraudulent
charity
tax
rebates
on
Home
Depot
gift
cards,
compromised
Starbucks
loyalty
points
accounts
and
gift
cards
allegedly
purchased
with
the
intent
to
fund
ISIS.
Cryptocurrency
Vs.
Robux
Of
course,
things
get
much
more
interesting
–
if
not
more
lucrative
–
when
fraud
begins
on
the
internet,
goes
out
through
retail
and
comes
back
to
the
internet.
Roblox
is
another
successful
MMORPG.
It
doesn’t
have
the
cultural
cachet
of
Fortnite
or
the
money-making
engine:
Roblox
reported
$2.2
billion
in
revenue
in
2022.
Epic
Games’
2022
sales
from
Fortnite
alone
are
estimated
at
more
than
double
that
amount.
However,
Roblox
does
have
its
own
in-game
currency,
Robux,
and
a
legion
of
youthful,
unbanked
players
who
lust
after
it.
Players
have
fallen
victim
to
a
“gift
card
method”
attack,
where
accounts
have
been
griefed
or
taken
over
using
the
gift
card
code
as
a
means
of
authentication.
The
ripple
effects
of
Robux
supply
and
demand
have
spread
beyond
the
game,
too
–
into
[click
fraud.
In
a
2022
episode
of
the
internet
true-crime
podcast
Darknet
Diaries,
a
pseudonymous
guest
described
distributed
click
farms
where
kids
are
compensated
in
Robux
for
watching
ads
and
filling
out
surveys.
“So,
it
would
cost
him
like,
$6
to
pay
a
kid
for
like,
$50
worth
of
income
for
him.
He’d
have
like
2000
kids
a
month
and
he
was
making
$1,000
to
$2,000
a
day,
and
that
was
the
most
I
had
ever
seen….
He’s
my
age;
he’s
like,
fourteen,
fifteen,
and
he’s
doing
this
every
single
day.”
Does
Bitcoin
Fix
This?
I
think
$2,000
a
day
is
impressive
earnings
for
a
child
of
15,
but
it’s
almost
certainly
a
rounding
error
in
the
multibilion-dollar
business
of
fake
traffic
on
the
internet.
And
in
the
rankings
of
scams,
it
doesn’t
come
close
to
the
billions
crypto
users
have
lost
to
bridge
hacks
alone.
And,
while
permissionless
networks
like
bitcoin
provides
extralegal
paths
for
uses
both
deplorable
and
laudable,
some
crypto
projects
are
apparently
finding
a
better
option
for
regulatory
escape
in
something
that
looks
a
lot
like
gift
cards.
There
could
be
many
interesting
opportunities
in
a
more
open-source
approach,
making
gift
cards
more
composable
or
programmable.
There
might
even
be
a
role
for
a
shared
trust
layer.
But
at
present,
it’s
hard
to
see
incentives
for
issuers
to
create
one.
Once
you
build
to
a
point
where
you
can
issue
a
desirable
gift
card,
you
want
to
keep
those
dollars
in-network,
behind
your
moat
–
whether
that
moat
is
a
Home
Depot
parking
lot,
or
an
Epic
Games
login.
It’s
up
to
builders
in
Web3
to
find
the
user
experiences
where
open
and
composable
networks
make
those
businesses
look
obsolete.
