Ruling the Metaverse

Part 1: the case for regulation

When you hear the word “metaverse” what springs to mind? The first thing I’ll say is there’s no one metaverse, but a limitless number of them. Each one with its own community focus and its own attributes, characteristics and rules.

What is a metaverse?

At its most simple, a metaverse is a virtual reality environment where people can interact with others, but it has other hugely important attributes that distinguish it from your average VR world. Attributes like scale, interoperability, real-time rendering, persistence (even when you’re not there) and individual presence and continuity of data.

For some, the metaverse concept is new, but those who were into reading sci-fi in the 1990s (ourselves included) will have come across the term in Neal Stephenson’s dystopian cyberpunk novel Snow Crash (which we highly recommend you read). And since then it’s made regular appearances in popular culture.

If you watch The Flash series, you’ll likely recognise various references to metaverses and parallel universes. And Spielberg, in his movie Ready Player One, showed us his version of the metaverse in the “Oasis” — a virtual world that combined gaming and a social life to powerful effect. And talking of gaming, we’ve been able to play, and interact with others, in virtual universes like The Sims, Eve Online and Second Life. Incredible to think that Second Life, which has been visited by millions and transacted billions of dollars, was launched waaa…aaay back in 2003.

In essence, the metaverse builds on these platforms to provide a very interesting cross-over point for a lot of things we already have, but also it unleashes the potential for a lot of new applications and experiences. It brings it all into a single domain, and provided we can overcome some of the key challenges, the metaverse should and could create untold opportunities for individuals, organisations, government agencies and the wider society.

House rules

One major obstacle (or opportunity if you prefer) in this brave new virtual world is regulation. What does it mean in something like a Metaverse, which as our colleague Ernest Kissiedu likes to refer to as “a glorified giant virtual sandbox”. How do you even go about beginning to regulate something made up of 0s and 1s? Well, we think the concept of regulation has been misunderstood by a lot of people in crypto, in blockchain, and in tech, generally. But realistically, it’s the only way that individuals can create a meaningful contract to live together in a collective environment.

Majority rules

But the moment one person needs to interact with another — whether in the metaverse or in society — then we need a set of rules both parties can agree on. Here’s a simple real-world example: people don’t walk around naked in the streets. There’s what what French philosopher Jean Jacques Rousseau would define as a “social contract” and it’s contracts like these that society uses to create the laws that govern our lives. There is no doubt that we need to create a new code of existence for the metaverse(s) that will govern our lives as a collective of individuals in a metaverse.

It doesn’t have to be built on a moral or theocratic framework, but it’s likely to include social contracts or regulations based on what you can and cannot do. So, long story short, establishing a set of rules the majority agree upon helps all participants in a metaverse to live together in a way that’s respectful and protective of each other and enables everyone to grow together in a fair way.

Mob rule

To some degree this goes against the crypto-anarchist community that believes strongly in self-sovereignty and the absence of regulation in any blockchain or crypto project. Personally, we believe the concept of crypto anarchism is misleading. The original term “anarchy”, in the sense Pierre Joseph Prudhon (another French philosopher and father of the Anarchist movement) meant it, refers to “an absence of government and absolute freedom of the individual”. He did not mean it in the sense of chaos, disorder and lawlessness.

Our point is that the majority of players in crypto and blockchain recognise that even a decentralised world needs a set of rules to play by (even a smart contract is a kind of regulatory tool). And this regulation / moderation could lie with an external industry regulator or Government, or the community that makes up a metaverse itself. Which leads to our next point about regulation versus moderation.

Regulation versus moderation

One of the main challenges of the metaverse revolution will be how society goes about governing these virtual spaces. For example, how do we distinguish between the concepts of regulation and moderation in the metaverse? To us, both are parts of the same system. For example, a regulation says anyone earning over a certain amount in a country has to pay income tax in that country. The moderation aspect is enforcing that regulation. So maybe we don’t pitch moderation against regulation, but rather see moderation as a direct effect of regulation.

In other words, you have set a set of democratic rules (regulations), that you need to democratically enforce (moderate). Personally, we believe every metaverse will have to be subject to some kind of regulation and moderation in the same way we’d expect it if humankind colonised Mars.

Last word

Rules not only provide a fairer and more level playing field to those who’ve signed up to them, their enforcement also brings reassurance, confidence and trust that a system or environment is working for the collective good as well as the individual’s potential. Of course, we don’t have all the answers at the moment, but we’ve no doubt these discussions will keep the rule-makers, regulators and moderators/enforcers busy in the years to come.

Next time…

In “Ruling the metaverse: part 2”, we’ll be looking more closely at how Concordium’s can play a role in the regulation / moderation discussion. Plus, we’ll be opening Pandora’s box to explore the altogether more heated debate between privacy and accountability that continues to rage in the crypto and blockchain world.