Meta goes beyond the world of social media by introducing the Metaverse, a digital space that brings together the future of technology through virtual reality technology and digital interpersonal relationships. Think of it like a video game on steroids. A simple pastime here to stay or a fleeting trend based on science fiction? It’s a common question people are asking as the Metaverse fills the headlines. To answer this, Global LegalTech Hub organized a roundtable, "What about Metaverse?", featuring a group of experts on this topic.
Taking part in the roundtable discussion was Joaquin Matinero, Blockchain Associate at Roca JunYent; Megan Gordon, L&DR Partner at Clifford Chance; Carlos Escapada, PyTorch Global Business Development Manager at Facebook AI; and Stephen Ritter, Chief Technology Officer at Mitek Systems.
What role is Meta going to play in the Metaverse?
According to Escapada, Meta plans on providing immersive solutions and partnerships that will replace much of the current software. The platform will offer new enriching and engaging ways for companies to interact with their audiences.
However, given that the virtual space is so new, Facebook has recently undergone a name change, and the platform is still in development, it’s understandable that people might confuse Meta and the Metaverse. To be clear, Meta refers to Meta Platforms Inc, which is the name of the company formerly known as Facebook, led by CEO Mark Zuckerberg. The Metaverse is the name of the platform they are developing that will replace many of the ways we interact online today through a virtual experience.
Learn more about which generations might accept the Metaverse first
What are the legal implications of the Metaverse?
According to Gordon, the Metaverse is here to stay in the long-run. That’s because it’s based upon certain foundational building blocks that so heavily impact our online activity: Online gaming and cryptocurrencies. The lines between the physical world and virtual reality have blurred as the concept of paying "real money" for virtual assets becomes more normalized.
However, we have to consider certain legal issues in this new virtual land, such as trademarks, as seen in the recent case of MetaBirkin and Hermes. The latter sued a digital artist for making an imitation of its Birkin bag and issuing MetaBirkin non-fungible tokens (NFTs).
Other issues related to financial crimes and data privacy may also arise that have yet to be identified. Right now, there are many unknowns about what regulations should be in place, including jurisdictions and which country. There are no physical borders in a virtual environment, unlike in the real world.
But for Gordon, the more interesting question has to do with what the Metaverse is going to look like in terms of interoperability and data. How is it going to incorporate blockchain technology? Is it going to be like a blockchain-based Web 3.0, or are there going to be a handful of big companies that control the environment with their platforms? Is there potential of us facing a scenario like the one portrayed in Ready Player One?
How will the Metaverse build in digital identity?
Another key aspect is how people will connect to and identify themselves in the Metaverse. Will our identity in the Metaverse be the same as our identity in real life?
According to Ritter, the possibility of anonymity in the right environment is powerful, so the key will be how to require the right amount of identity assurance for each type of interaction. Fortunately, there are already many tools that allow us to carry out this identification at different levels.
Conversely, decentralization is an intriguing trend that leads us down the line into the concept of a multi-metaverse versus a single offering. So, the question goes beyond how we should create digital identities with the right level of identity assurance and into how these identities should move across the different metaverses.
Mariona Campmany, Digital Identity and Innovation Lead at Mitek Systems, commented in an article that "identity in the Metaverse should be considered almost like a genetic code that confirms biological identity". That is, it should allow us to move through different environments within the Metaverse using a full-fledged alter ego. This could be achieved using NFTs.
Campmany mentions in another article that the concept of self and identity in the digital world blur our idea of who we really are and what it means to be ourselves in the virtual environment. We need some kind of interoperable identity, like a passport, that we can use in multiple digital configurations to prove who we are.
Are people prepared to live in different parallel worlds?
The issue of digital identity in the Metaverse leads us to the next question. Are people actually prepared to live and move between different virtual worlds, in addition to the real one?
Escapada comments that the concept of the Metaverse is still being defined, but it will enrich digital relationships in a three-dimensional and contextual environment where people can collaborate and coordinate more easily.
It will be a gradual evolution, so it’s difficult to foresee how it will finally take shape, although it will probably be a fragmented scenario.
South Korea, the country that is currently the most advanced in adopting the Metaverse, already has two main platforms. Zepeto, which is purely digital, and ArcVerse, which combines the virtual world with the physical. Of particular note is the involvement of the South Korean government in the creation of these new ecosystems. It’s viewed as a cultural phenomenon.
Gaming and social interaction are the two main drivers for adoption of the Metaverse by consumers. Escapada comments that there are many large companies that already have a presence promoting their goods and services.
There are also many interesting use cases. This type of technology has already been in use for some years to rehabilitate very dangerous prisoners. It allows them to interact with therapists at a distance. However, which spaces are safe for people to interact in have yet to be defined, as there are plenty of "obscure places" emerging in the Metaverse.
Another issue that Ritter comments on is diversity in the Metaverse. We have already seen problems with race or gender bias in current technologies. Work still needs to be done to make technology fully inclusive. There is also the "digital divide”, i.e., unequal access to the internet and new technologies. This applies to not only countries but also to different social classes with unequal economic resources.
On the other hand, in places where people do not have easy access to traditional banking, fully digital fintechs have become an excellent option, as in the case of M-Pesa in Kenya. But, as Gordon points out, if we move to an increasingly digital world, it will require more and more resources, like electricity, that are not easily accessible for some countries, not to mention the question of sustainability.
Read more on diversity and identity from Mitek's CTO, Stephen Ritter
Can identity be stolen in this new ecosystem?
Security in the Metaverse is of particular concern for most users. According to Ritter, there is no 100% guaranteed security, so there will inevitably be cases of fraud and other crimes. The key will be to detect and identify fraudsters so they can be stopped as quickly as possible. There are already tools and solutions that do this in today's digital environment. Biometrics, in partciular, will play an essential role in this fight.
Regarding data privacy, Gordon comments that there is no environment 100% secure at the financial and data level. But there are already more aggressive legal initiatives that enhance the protection of the user and their data and privacy, such as the GDPR in Europe and the data protection laws in China.
There is a growing amount of tension between the evolution of technology and the ability of legislation to regulate it. But as more and more financial services spread to the Metaverse, legislation will need to cover these as well.
Is the Metaverse a threat or a better alternative to the real world?
According to Ritter, the Metaverse, similar to cryptocurrencies, is perceived as a threat to governments and traditional entities in the sense that they lead to decentralization and, therefore, a loss of control over people's information. It's definitely going to be a game of push and pull to control all the information generated in these environments.
The approach to the Metaverse is one of cautious optimism. It offers value in the potential advantages it brings, but there is a lot of work to be done to make it a safe environment that can be adopted on a large scale. The involvement of governments will be essential in order to regulate and consolidate this environment.