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Info: Entropia PED flow and Loot Pool basics explained

e-lite

e-lite

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Xaero e-lite Cynque
The last couple of weeks I have read several post in different threads showing there’s a huge confusion around how EU’s economy works. This question has been answered by MindArk before in a Q&A many years ago, but apparently this information has gone lost over the years. So I thought I’d take a few minutes and try to explain the basics as simple as I can.

The confusion is that all real cash that is deposited into PED goes straight into EU’s shared economy, loot pool and MindArk’s assets. Well this is not how it works.

All deposited PED must first turn into player deficit or loss before it goes into loot pool, deed returns or withdraw-able funds.

An example of this would be if you go into a casino and buy $1000 worth of play markers/chips. As long as you have the chips in your pocket and did not lose any of it on a game, it is still yours to withdraw, and it is not counted towards the casinos winnings pool.

It is not until you lose some or all of these markers/chips that they belong to the casinos winning pool and economy.

This is the same with PED. If you deposit $1000 USD (10K PED) they are not accounted for as MindArk assets as long as they are either on your PED card or traded for against items. It is not until some or all of those PED are lost into hunting, crafting, mining or decay as they are added to the loot pool and to the withdraw-able pool.

MindArk always needs to reserve a quite large overhead of the total amount of PED in the “loot pool” for deed payouts and withdrawals. This is also why there’s quite a long withdraw time until you receive your real world cash back after doing a withdrawal.

There’s the basics. Hope this helps to clear up some confusion.
 
e-lite said:
MindArk always needs to reserve a quite large overhead of the total amount of PED in the “loot pool” for deed payouts and withdrawals. This is also why there’s quite a long withdraw time until you receive your real world cash back after doing a withdrawal.
Click to expand...


bullshit.;)

Withdraws take so much time because Mindark has 3% of total PED which exists ingame covered with RL cash, that my friend is the truth, why it takes so long for your withdraw to be completed (2+ months)...
 
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the_prophet said:
bullshit.;)

Withdraws take so much time because Mindark has 3% of total PED which exists ingame covered with RL cash, that my friend is the truth, why it takes so long for your withdraw to be completed (2+ months)...
Click to expand...

No. tooshort

<removed>
 
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e-lite said:
It is not until some or all of those PED are lost into hunting, crafting, mining or decay as they are added to the loot pool and to the withdraw-able pool.
Click to expand...

This pretty much sums it all up. If we all made deposits, didn't spend it on anything and instead decided to withdraw, MindArk would only get a little back from the transfer fees they levy.
 
the_prophet said:
bullshit.;)

Withdraws take so much time because Mindark has 3% of total PED which exists ingame covered with RL cash, that my friend is the truth, why it takes so long for your withdraw to be completed (2+ months)...
Click to expand...

I would hope that this illegal in Sweden but I have no idea how the financial legislation works with EU if it's not considered a casino
 
Steveyneo said:
This pretty much sums it all up. If we all made deposits, didn't spend it on anything and instead decided to withdraw, MindArk would only get a little back from the transfer fees they levy.
Click to expand...


MA don't charge anything for transfere, as far as i am aware. All costs are associated with each bank and or credit card. NOT from MA.

So if everyone deposited then instantly withdrew. The only money MA would make is from interest while the deposits sit in their bank account.

Rgds

Ace
 
<removed>

Bottom line is that what e-lite wrote about withdrawals is bullshit and don't get me wrong - I'm glad it is that way.

Because if it isn't so and what e-lite wrote is actually true;

- and MA actually take the ped, which you put into "withdrawal mode" (taken from your ped card into limbo until you get it on your bank account)
- and use them to pay ingame revenues such as CLD payouts etc. and only then - when they can again "grab" enough PED to process the withdrawal to put those ped back into limbo "withdrawal mode"

and what I just wrote is true - then the situation is even MUCH MUCH worse than anyone would think it is..
 
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Ace Flyster said:
MA don't charge anything for transfere, as far as i am aware. All costs are associated with each bank and or credit card. NOT from MA.

So if everyone deposited then instantly withdrew. The only money MA would make is from interest while the deposits sit in their bank account.

Rgds

Ace
Click to expand...

Are you forgetting the 100PED withdrawal process fee:confused:
 
the_prophet said:
Are you forgetting the 100PED withdrawal process fee:confused:
Click to expand...

Oh right - obviously banks in Sweden don't charge anything for international wire transfers from business accounts ... :rolleyes:
 
Ace Flyster said:
Maybe i am thinking of depositing, rather than withdrawing.


Rgds

Ace
Click to expand...

Weird that you are maybe thinking of depositing rather than withdrawing, when what you actually wrote was;

Ace Flyster said:
So if everyone deposited then instantly withdrew. The only money MA would make is from interest while the deposits sit in their bank account.
Click to expand...

Sry, from your first post it can be read, that if everyone deposited money and instantly withdrew, that MA wouldn't make any money except for the interest from the money sitting in their bank account

- where in fact they make 100 PED per withdrawal :ahh:
 
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the_prophet said:
<removed>

Bottom line is that what e-lite wrote about withdrawals is bullshit and don't get me wrong - I'm glad it is that way.

Because if it isn't so and what e-lite wrote is actually true;

- and MA actually take the ped, which you put into "withdrawal mode" (taken from your ped card into limbo until you get it on your bank account)
- and use them to pay ingame revenues such as CLD payouts etc. and only then - when they can again "grab" enough PED to process the withdrawal to put those ped back into limbo "withdrawal mode"

and what I just wrote is true - then the situation is even MUCH MUCH worse than anyone would think it is..
Click to expand...

That is not even what I wrote :D Maybe read the post again. This is facts my friend, it was confirmed by MA them self at a Q&A, but I assume it was before your time here.
 
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e-lite said:
That is not even what I wrote :D Maybe read the post again. This is facts my friend, it was confirmed by MA them self at a Q&A, but I assume it was before your time here.
Click to expand...

Sure, ok, if you say so, OK, lets play your game then :)

Explain then, what did you actually mean by this :laugh::laugh::laugh::laugh::laugh::laugh::laugh:

e-lite said:
MindArk always needs to reserve a quite large overhead of the total amount of PED in the “loot pool” for deed payouts and withdrawals. This is also why there’s quite a long withdraw time until you receive your real world cash back after doing a withdrawal.
Click to expand...

<removed>
 
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e-lite said:
The last couple of weeks I have read several post in different threads showing there’s a huge confusion around how EU’s economy works.
Click to expand...

yes and the biggest confusion is that ppl tend to merge Mindarks economy with EU economy.

100USD in bought peds = 100USD to cover cost and profit for Mindark. Nomatter what happens ingame with the PED.
 
<removed> All I posted is that withdrawal times take long because MA doesnt even have 5% of PED INGAME covered with RL CASH.

<removed>

When in reality EVERYONE CAN SEE THIS INFO, IT IS IN THEIR FINANCIAL REPORTS, THEY HAVE ~3% of PED ingame covered with RL cash.

If you can't understand that this is the biggest reason withdrawals take so long - not my problem, <removed>
 
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Ace Flyster said:
MA don't charge anything for transfere, as far as i am aware. All costs are associated with each bank and or credit card. NOT from MA.
So if everyone deposited then instantly withdrew. The only money MA would make is from interest while the deposits sit in their bank account.

Rgds

Ace
Click to expand...

Not true. I have credit card from bank with "NO" foreign transactions fees and MA still takes their 40 ped for every $100 USD deposited
 
sighlentz said:
Not true. I have credit card from bank with "NO" foreign transactions fees and MA still takes their 40 ped for every $100 USD deposited
Click to expand...

I would say the 40 ped has to pay for for some sort transfer fee. That MA most probably have to pay for. Like when you use your credit card in a shop the shop has to pay for you using your card. A lot of small shops wont let you use credit for small purchases.
 
sighlentz said:
Not true. I have credit card from bank with "NO" foreign transactions fees and MA still takes their 40 ped for every $100 USD deposited
Click to expand...

And it's never occurred to you that businesses pay 'merchant fees' for receiving credit card payments? :scratch2:

Just because your card company doesn't charge you for the transaction at your end, doesn't mean that someone else isn't paying fees somewhere down the line.

It astounds me sometimes how little some people seem to know about everyday business operating costs like this.
 
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Count Joe said:
yes and the biggest confusion is that ppl tend to merge Mindarks economy with EU economy.

100USD in bought peds = 100USD to cover cost and profit for Mindark. Nomatter what happens ingame with the PED.
Click to expand...

Very good point, because it is 2 different things.
 
e-lite said:
MindArk always needs to reserve a quite large overhead of the total amount of PED in the “loot pool” for deed payouts and withdrawals. This is also why there’s quite a long withdraw time until you receive your real world cash back after doing a withdrawal.
Click to expand...

Totally disagree with last statement. Long waiting period serves purpose- to keep withdrawals as minimum as possible. Some folks don't even bother to withdraw because of long waiting period and keep wasting PEDs instead
 
the_prophet said:
bullshit.;)

Withdraws take so much time because Mindark has 3% of total PED which exists ingame covered with RL cash, that my friend is the truth, why it takes so long for your withdraw to be completed (2+ months)...
Click to expand...

Dunno about 3% or 5% but in general yes - MA doesn't have enough dollars to cover ALL PEDs ingame. It has been like thatfor many years now. Most likely since financial crisis and introduction of CE.
 
Ace Flyster said:
MA don't charge anything for transfere, as far as i am aware. All costs are associated with each bank and or credit card. NOT from MA.

So if everyone deposited then instantly withdrew. The only money MA would make is from interest while the deposits sit in their bank account.

Rgds

Ace
Click to expand...

10 dollars withdrawal fee
 
Spawn said:
10 dollars withdrawal fee
Click to expand...

Which goes towards the transfere fee, back to our accounts. I presume they set this high, so i also presume? that the difference goes to MA. What that is i don't know.


Rgds

Ace

EDIT: i don't know this, i am presuming this. Does anyone know for sure?
 
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Reply

Not sure if I'm playing a different game but I just submitted a withdraw to my bank account and it was 1% of the total withdraw with no limit of 10usd. Why is everyone saying 10usd?
 
m0rr0w2 said:
Not sure if I'm playing a different game but I just submitted a withdraw to my bank account and it was 1% of the total withdraw with no limit of 10usd. Why is everyone saying 10usd?
Click to expand...

Its 1% with a minimum of 100 ped (10usd) - depending on which one is higher.
 
Further to my earlier post #4, from the withdrawal FAQ, which may be helpful for some that haven't seen it before:

Do I have to pay any fees when making a withdrawal?
The withdrawal fee is 1% of the amount you wish to withdraw. The minimum fee is 100 PED (10 USD). Your own bank might charge additional fees.

Is there a minimum withdrawal amount?
Yes, the minimum amount you can withdraw from your Entropia Universe account is 1000 PED (100 USD).
 
Just... no...

First of all no one knows A) How the loot pool works or B) If there is a loot pool at all.

Second it is a bit sad to see old myths be displayed as fact. There is not a shred of proof to support these theories. Sure, we all heard Marco say "MA makes money from decay". But that in itself proves nothing. Lets keep in mind that MA has never confirmed there being a "loot pool" (or did I miss something?) - in either way you'd be wrong on all other points.

There is as much proof of perception increasing your loot as there is of the existance of a loot pool.

e-lite said:
The confusion is that all real cash that is deposited into PED goes straight into EU’s shared economy, loot pool and MindArk’s assets. Well this is not how it works.
Click to expand...

Well, it kinda is just like that actually. PED deposited into entropia goes straight into MA's pocket. If there is a loot pool or what not (however the game handles payouts) is another story entirely.

e-lite said:
All deposited PED must first turn into player deficit or loss before it goes into loot pool, deed returns or withdraw-able funds.
Click to expand...

No. Or kinda no. It depends on if there is a loot pool or not. Either way you're not likely to loot anything without spending PED so it's a moot point.

e-lite said:
This is the same with PED. If you deposit $1000 USD (10K PED) they are not accounted for as MindArk assets as long as they are either on your PED card or traded for against items. It is not until some or all of those PED are lost into hunting, crafting, mining or decay as they are added to the loot pool and to the withdraw-able pool.

MindArk always needs to reserve a quite large overhead of the total amount of PED in the “loot pool” for deed payouts and withdrawals. This is also why there’s quite a long withdraw time until you receive your real world cash back after doing a withdrawal.
Click to expand...

No, that is not how it works.

e-lite said:
There’s the basics. Hope this helps to clear up some confusion.
Click to expand...

Well.. nah. :(


By now you are probably asking "Well how does it work then?" The answer is this: PED deposited into Entropia = income for MA. PED withdrawn from Entropia = expense. The total ingame PED balance is considered a contingent liability and is thus not accounted for in the balance sheet.

For example:

The 2014 annual report for the MA group has this note:

Note 19 Contingent liabilities
Group and Parent Company
Unconsumed user holdings: MindArk defines operating income from Entropia Universe as the net amount of provided and withdrawn funds by users.

Participants in Entropia Universe can at any time request a reimbursement of all their unconsumed assets in the virtual currency PED. MindArk then reserves the corresponding amount in SEK as an accrual.

It is not possible to determine whether a certain amount of PED at any given moment will be withdrawn from Entropia Universe or spent on activities within the virtual environment. MindArk therefore consider all unconsumed funds in PED as a contingent liability.

The corresponding value of all unconsumed PEDs is calculated at 97 million SEK on December 31st compared to 74.5 million SEK the previous year.
Click to expand...

The ingame PED value for 2014 was 97 million SEK.

The balance sheet for the entire MA-group for 2014 lists assets totalling 32 million SEK.

That is your casino example out the window.
 
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They said there is no personal loot pool, but they have mentioned there are loot pools. ;):silly2:
 
Why spend so much energy and wordswordswords to refute E-Lite's claim... only to turn around and confirm it:
Konve said:
The total ingame PED balance is considered a contingent liability and is thus not accounted for in the balance sheet.
Click to expand...
Didn't realize u actually saying exactly the same, only using different words.. :)

E-Lite has correctly described the basics of the RCE system.
  • Lootpools or not?
  • Unspent PED's ingame covered with liquid funds IRL 100%, or not?
  • How much exactly MA charges to process withdrawal and deposit?
  • How long does MA delay the withdrawals intentionally and how much is related to the background checks required by the law?
- yes there's a few details we don't know for certain. Luckily in the big picture those details are irrelevant. Could be this, could be that...
All those details don't really matter as long as we speak about the basic concepts of RCE.

It's a very useful post, it's amazing how many players are totally in the dark about the very basics... :yup:
 
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