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For those doing business in Second Life the Currency Exchange is a tool that can improve their profit margin when they are taking L$ out of world to RL currencies. One just has to understand how it works, which is what this Second Life Currency Exchange Tutorial is about.

If you are a resident that just needs a few Linden dollars on occasional bases to purchase something, you can still gain from understanding how the Currency Exchange works and knowing what it is and how to use it. You won’t need some of the more esoteric information I’ll provide. Knowing the basics will save you a few L$.

The Exchange


XStreetSL Currency Exchange

XStreetSL has a Currency Exchange, which is now owned by Linden Lab. This is a place where you can easily buy and sell L$ as well as other stuff. It is a fun place to shop also and has loads of free stuff. There is no StreetSL fee for moving funds between SL and PayPal. Using PayPal is the only way to take cash out of XStreetSL.  URL:


SL LindeX Currency Exchange

Second Life has the LindeX™ Exchange. One can trade L$ there. Much of what is going on is the same as at XStreetSL. You can get to LindeX from any Second Life web page.  There is also a US$0.30 fee to buy L$ regardless of amount bought. When selling there is a 3.5% fee on the amount sold. All money is held in your SL account. When moving funds out of the SL account there is a US$1.00 charge and one can only move funds to PayPal.

Why Bother?

It is worth one’s time because there are two types of people buying and selling L$. There are those that want a deal At Best Price (ABP) right now, which is also known as a Market Buy.  The At Best Price could be a little miss leading as it means At the Best Price RIGHT NOW. There are also those that want to buy at a Set Price (SP), also known as a Limit Order, whenever they can get it. Time is a factor in the process and you can wait for a better price. If you are willing to wait, you can get a better deal using a SP or Limit Order.

LindeX Buy

LindeX Buy Dialog

Today the best price for an ABP transaction I can get L$ for on the LindeX is L$252.43 per US$1.00 for US$10. The more I buy the better the price.

However, if I go over to XStreetSL and look at the Open Orders List I can see there are people willing to sell L$ at L$277.80 per US$1. (see image ‘Open Orders XStreetSL’)  I could buy those and get about L$25 more per dollar, a good deal for me. So, better deals are available for those that are willing to wait. One can make either type of purchase at either exchange.

Open Orders

Open Orders XStreetSL

At LindeX you can get a better deal by scrolling down and looking at Open Sell Orders (See image ‘LindeX Open Sell Orders’) and placing a Limit Order. The best deal on LindeX Limit Order at the time was L$260/US$1. But my US$10 was going to happen at L$252 for a Market Buy oABP. And the XStreetSL Exchange is showing a best deal at L$277/US$1.

Now we know why this can be worth your time. On this little US$10 order I can save about US$0.50. Not big but certainly worth the effort to type in one box on the page over another.

Getting the Absolute Best Deal

As one searches for the best deal they will soon learn that eBay has L$ for sale. As I write this there is L$10k @ US$49.97 offered. That is L$200.12/US$1. Not such a good deal. And there are scams out there as well as outright thieves. Take care where and from whom you buy.

You can figure the best deal for you on either XStreetSL or LindeX. As we can see the XStreetSL deal looks better and usually is. L$277.80 (sell) is a good buyer’s deal. But one is not going to get that price because of a thing  currency traders call pips. This is the money-changers cut of the deal or fee. It is now L$3.00/US$1. In RL money exchanges compete and this rate varies. Not in SL. The ‘order filler’ pays the fee. In this case the ABP buyer or seller. A SP Buyer or Seller gets their set price, which is one way to look at it.

LindeX Sell

LindeX Open Orders

The fee (pip) effectively matches the L$277.80 sell offer to a L$274.80/US$1 buy offer. Remember, when buying less L$’s per dollar costs more, So L$274/US$ is more expensive than L$277/US$. When selling less L$ per dollar makes you more dollars.

Now if you want to pay L$277.80/US$1 there is no one currently in the list is willing to sell to you. Someone would have to be willing to sell for L$280.80/US$1 or more for there to be a deal on your L$277.80 buy offer. Confused?

I’ll try to un-con-fizzle you. Look at the open Buy Orders on the left starting with L$276.5. Say you are wanting to sell L$. Start at the top of the left column and add the L$3.0 pip (fee) to the rate and then try to match it to a Sell Order on the right. You can’t and it gets worse as you move down the list, which is why the Open Orders are open, unfilled.

Turn this around and say you need to buy L$. Now the best fast deal for a buyer is subtract the L$3 pip from the top rate in the sell column taking L$277.80 to  L$274.80. There are no 274’s on the left for the L$277.80 order to match to. Your order at L$274 +/- will create a match. It should fill quickly and you’ll be on your way. Way better than L$252 or L$260 as seen on LindeX.

You know the basics now and that should be enough for an occasional buy/seller. Now we get into messy details.

Advanced Currency Trading


XStreetSL Currency Chart

The chart shows a snapshot of the trades across five days. You can some hills and valleys. You can also see spikes in rates. In a RL market these spikes would capture all the orders within a range. But, XStreetSL doesn’t work that way and the spikes are an aberration of what is really happening. Small orders and penny round-off cause the spikes. You can ignore them as it is not going to help you sell/buy L$. The cause is an attempt by the Lindens to keep the market fair. But, this has effects on how you buy and sell.

When selling small amounts (L$500 is the minimum transaction now) there is a problem with round-off. The Linden accounting system is in US dollars and the smallest unit is a penny i.e., US$0.01. In L$ the smallest unit is L$1. While you can have fractional rates there are no L$ pennies in SL.

Currency Chart

XStreet Currency Summary

This means that per the summary above L$1 is worth from 1/279.7 to 1/266.0 US dollars or US$ 0.00357 to US$0.00376. Turn this into something other than just math and the smallest amount we can handle is a penny or L$2.797 to L$2.660. But now we have …cents… in L$ which does not work. There is about 9% to 14% error in these two numbers when we round them off. That won’t work. On big transactions that could be a lot of Lindens.

The first step taken to keep things honest is to apply the round-off on the full transaction amount rather than per L$. The smaller the transaction the worse round-off is. So, a L$500 minimum is used at XStreetSL now. Consider a L$500 order filled at L$277.80. (500/277.8= US$1.799856) Round that off to $1.80 and it is a much smaller percent of error. But this starts to reveal another problem.

If I put in an order of L$500 at 277.2 or 278.6, I will still be US$1.80. This is why the final amount you actually pay varies from what XStreetSL and LindeX estimate. They make the best and nearest match between traders and you pay the actual trade price rounded to the nearest penny. It is also part of why one sees those spikes in the currency chart.

Smart traders once used this idea to bump ahead in the trading cue at no cost. A recent change in how the rounding is handled changes that and makes it fairer to older orders. In both cases the deal goes down at $1.80 so a new 277.2 and old 278.6 are the same money-wise, so the older of the two fills first.

The Daily High/Low can reflect this problem too. The old order may be the 277.2 order. The high can show trading at 278.6 while it was the 277.2 that was filled. This makes the chart harder to understand and explains why orders under the high and above the low may not fill. Check the high and low and then look at the Open Orders list. There are many unfilled orders between the high and low shown on the summary.

When you look at the Open Orders you can see how many orders are likely to fill ahead of you. You can get an idea whether it will be a long or short wait.

You can figure out the best range in which to set your rate for a fast deal without changing your cost. Decide the L$ amount and pick a rate. Let’s say we want to buy L$1500 and are willing to wait a bit so we decide L$280 is good.

1500÷280= 5.35714 which rounds to $5.36

Now add 0.004 to get one limit and subtract 0.005 to get the other limit.

1500÷(5.36 + 0.004)= 279.6

1500÷(5.36 – 0.005)= 280.1

Setting the rate at either 279.6 or 280.1 or in between is essentially setting the same rate. But change the L$ amount and things change. The difference in these two rates is 0.46. Bump the 1,500 to 5,000 and the range narrows to 0.14. At around L$15,000 the range disappears for practical purposes and there is no point to looking at the range. But, for smaller amounts knowing the limit of the range can give you a better idea how many other orders you may be competing with.

LindeX™ vs XStreetSL™ Trading

If you noticed, the rates at XStreetSL and LindeX are different. I suspect this is because many are using the LindeX to pay their tier. That places pressure on the LindeX that does not exist on XStreetSL. I can wait to purchase that cute lingerie. I can’t wait to pay tier. Here are rates as I write.

LindeX Sell @ L$259         XStreetSL Sell @ 275.8

LindeX Buy @ L$269        XStreetSL Buy @ 276.5

So, can I sell on one and buy on the other? Yes. But… There are transaction fees on the LindeX. It looks like it would be good to buy on XStreetSL and Sell on LindeX.

To make money one has to be able to cover the fees. To get from XStreetSL to LindeX one must go through PayPal and the same returning. L$500 converted to US$ 500÷259=US1.93 minus conversion fee of 3.5% minus US$1 fee leaves US$0.86… so no good for small transactions.

Consider that the 3.5% fee at LindeX (the pip on XStreetSL is about 1%) changes the sell rate from 259 to 268. Still a better sell rate than XStreetSL.  Even with the US$1 charge it can be a deal. But you need to be trading more than L$27,000 to start to make it compare to XStreetSL.

Once you are moving over L$30k you can consider looping through LindeX. But with that much effort you can do better spending your time at something else. To really make money I’ve been told that one needs to be moving  US$40k per month.

Differences in Second Life from RL Currency Trading

If you are thinking trading L$ currency is like RL trading think again. It is similar but not the same. There is no leveraged trading. Leverage describes the practice of buying a commodity or stock on margin, meaning I’ll put up 10% (or whatever the current rate is) of the money to buy 100% of whatever. This means I can place a buy order for $100 by putting in $10. The stock, commodity or currency is the collateral for what is effectively a loan. The broker will hold the stock or commodity until I pay the remaining 90% or the stock, commodity or currency appreciates in value enough to pay off the 90%. There is more to this but you get the idea. Since Lindens are a controlled currency there is no possibility it will appreciate past a given value and therefore there is little point in attempting to leverage purchases.

L$ are, for practical purposes, not banked, meaning there are no interest-bearing-accounts for L$. So, there is no point in accumulating them and holding them for any reason other than in-world use.

There is a currency spread. Since the top value and the bottom values of a L$ are controlled, the spread is controlled. The pip is currently L$3.00. Their charts show the pip as if it were spread.

It is possible to trade L$ and make money. But just as in real life the market has to move for that to be possible. Since the Lindens control the price in relation to the US dollar, we do not see much movement in terms of US dollars and world currency changes certainly do not show up on the XStreetSL Currency Exchange pages. So, currency trading in L$ for profit, requires large sums and more time than it is worth. This means the L$ Exchange market at XStreetSL is not a speculator rich environment.

How many Lindens one buys and sells at one time does make several differences and can affect  your profit line. A Second Life™ resident named Mintyfresh wrote an analysis in May 2008, An Analytical Look at the Currency of Second Life®. Since then XStreet was purchased by Linden Lab and things have changed. But his idea was smart then and a good one now… check your actual costs.

The transaction cost of moving currency from XStreet to PayPal no longer incurs a cost. However, that does not mean all transactions, as some do incur a cost. Just the XStreetSL to ‘cash’ transactions are free. See the January 2008 announcement: SL Exchange deposit fees changed.

You can get the most for your Lindens by keeping them in-world or in XStreetSL. Remember. Leaving funds in SL or XStreetSl or LindeX leaves you at the mercy of Linden Lab’s customer service and an account suspension or closing.

There is no cost to move currency between SL and XStreetSL. When you do want to take money out to RL remember the more you transfer the better your deal. In Mintyfresh’s calculation you pay a premium for trading less than L$3,000. You get a better deal on anything over L$3,000. He says this improves up to L$80,000 and after that the difference is so small it does not much matter. With the recent changes that improves for smaller amounts but one still must deal with the round-off problems. The current minimum limit you can trade is L$500. The maximum… I don’t know if there is one.



  1. Excellent info as always, Nalates. Thanks for giving us good, timely info.

  2. I recently came across your blog and have been reading along. I thought I would leave my first comment. I don’t know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.


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  1. […] wrote an earlier post on the Second Life Currency Exchange as a tutorial. Parts of the post are being updated. The idea behind that post was how to easy get a better price […]

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