The Impact of The Metaverse on Society - European Blockchain Convention, February 16

foreign [Music] hello everyone hi um I am Jemima Kelly from the ft and I actually have a column I'm a columnist at the Ft as it says up there and I have a column in today's ft about the metaverse um and I'm I'm going to be honest with you I'm gonna I'm gonna level with you I'm not sure I really believe in the metaverse um despite being the the moderator on this panel um my column was called whatever happened to the metaverse and my closing line was the metaverse never really begun and yeah it's already over that's so I just thought I should you know I thought I thought I should be real and just lay you know my cards on the table for we start because that's where I'm coming from and we've you've got 19 minutes and six seconds to convince me that I'm wrong so uh so can I so can we just start by just um because I think for me the biggest issue is the definition so could we just start by like each of you telling me what the metaverse is because I think that's what I don't know about the rest of you but like that's what I find the most challenging sure so we got 19 minutes to convince you and make you into a Believer what the metaverse is right so maybe you and I can do it right so there's we'll try it's a challenge bonus noches hi everyone Barcelona how's everyone doing yeah good energy is good everyone good cool well they're fired up so what is the metaverse I think uh it's an interesting question it's a very tough question to be honest with you right so um we're freaking it out to be honest with you as as we go along the way like what is virtual reality what is augmented reality right what are all these what's AI what's ml these are all these questions we have answers to these right uh but I think uh it's not something that is super tangible at this point so you can kind of like sense it uh but you can't really touch it and you kind of know where this is going um that's what the meta wears to me is Right everyone has their own definition um Robbie would have Robbie would have it would you concur yeah I think hello there we go I'm gonna go with this one um so I'll give you my take on it yes you know which is my personal opinion I think the metaverse is about open applications and about the idea of what happens to the internet if we have lots of different siled software applications that start to interoperate content with each other and so when I look at early attempts at building metaverses within web 3 obviously we have one called The Sandbox so you know that's my bias worn on my sleeve and then there are other ones like obviously decentraland and alien worlds and you name it there's lots of metaverses out there and I think if we're talking about the metaverse with a capital M the all-inclusive metaverse I think that's actually a composite of a really messy and chaotic landscape of things that are trying to work and talk to each other to a greater extent than websites and the internet does today and it will largely occur in three dimensions so that's also going to be kind of an evolution of where we are at the moment because the idea behind it in my mind is that if you have digital stuff that you own and now so you know we like to use blockchain to try to provide proof of ownership whether it's in the form of nfts so we make games and we make playable nfts as content inside games and if you own that stuff I think you want to be able to take that stuff with you from place to place and if you can do that then in my mind you no longer just have games but you have a metaverse like experience because all of it is connected even if it's imperfect and messy and so I think the important distinction is not to confuse the idea of the interconnectedness of it with the way you access it so I think one thing that meta has spent a long time on is promoting the idea that VR defines the metaverse but in my opinion that's just a way to access it because the metaverse is content and you can access it through VR through your phone through a desktop you know many different ways and people will enjoy different experiences based on their own way of accessing it just like you may enjoy a film on your phone or on your television or in a movie theater but it's you know it's just a different way of accessing content so I don't know that you can Define it very specifically because it's not just one thing just the way you can't really I wouldn't say you can Define the internet because it's a tool upon which people create lots of messy stuff that talks to each other I think you probably could Define the internet like I think the internet is easier to Define um and so you've said that it was something that you can sense in touch but and you've said that it's not definable so is is the answer that we just can't Define it because when we were on the phone a couple of days ago and actually this is something that I quoted in my in my column you said that there wasn't really any difference between the metaverse and web3 and that's I think it's correct that's correct correct yes yeah because what I'm talking about is the interoperability content between previously siled software applications so in my mind the aggregate of those software applications that interoperate would be the metaverse so why are we calling it The metaverse is that not just uh for me that's proof If I'm being honest that this is just another buzzword because we were calling it web3 why are we suddenly calling it The metabolt why do we need another name for it I mean if you go back in history when DARPA launched the internet what was it it was a protocol right it was just for two entities to communicate right sending data back and forth so why did we call it the internet I guess that's that's the question so you go we didn't we didn't keep calling it different things did we it was like so I think to maybe if if you want to put a fine point on it I think when people use the term metaverse they're thinking more about the UI and they're thinking about the three-dimensional aspect that most people assume is part of the metaverse whereas when people think of web 3 they think of early use cases for web 3 which were largely text based if you go and use uniswap to exchange cryptocurrency that's a web 3 application but it's not necessarily the metaverse so they're overlapping circles but they're not exactly I don't think I'm completely understanding but but we'll move on because otherwise we'll spend the whole the whole um the whole time kind of discussing that does okay here's here's one question we're obviously at the blockchain conference but does does the metaverse need the blockchain like those two things one and the same like yeah I think yes yes absolutely you need you need protocols you need layer once layer twos and there's no way to Mint nfts without the ability of the technology right so it's kind of like the chicken or the egg problem but what comes first but absolutely yes you need the blockchain to have the metaverse with me it doesn't feel like a chicken and egg problem it feels like metaverse how how I think most people have understood it to be honest is that it's a kind of uh virtual world in which which you can a kind of another layer of the internet that you can that creates this kind of 3D immersive virtual world a mix of VR and AR you don't need nfts for it really to be honest you might have digital property which you might choose to do with an nft or not but the idea that it needs to run on the blockchain or that you need blockchain based up I'm not genuinely can you tell me can you explain that because so I think that the important part is the interoperability piece okay and the best tech that we have currently to provide that would be the blockchain so what you're describing to me sounds like what from a gaming perspective I would call a VR game because it exists in it's a single environment all the content exists within that environment within what the developers created and that's it it's a world and you know there are lots of great games out there both VR and non-vr but those are what I would classify as being web 2 games because they're not designed in a way to talk to other games for you to bring objects from those games into other games and I think that interoperability piece is where blockchain allows us the potential to actually do that so Timber the great Timber burners entered the web he says that web 3 is is a bit of a nonsense I think and one of the reasons that he said this says this is that I think the idea that your that your data should be held on a public database on a blockchain is wrong and you want it to be private you actually personal data is personal for a reason and you want it to be want it to be private so he says that he's obviously pushing the idea that web 2 is is broken so I think often with with some of this stuff we like I would agree with that as well like I would agree that there is a need to that the kind of current centralized version of the internet um isn't great like needs in which we've all become the product and everything you know and so I think we can all agree on maybe the the kind of the problem but not necessarily the solution so what would you say to to this to to burners Lee who says that actually that kind of stuff should be private not published so maybe I can just add a little bit of color so I guess we're going back to the on-prem era so you know web.1.0 so everything should be on-prem so same same issue with it should be on on-prem so on-prem when you had servers and behind you know walls and whatnot and you were controlling your own data and whatnot maybe we should go back to that error that there was nothing wrong with it Cloud came and cloud changed that so you gave access of your data your personal data your company data Enterprise data what we have you to Providers like AWS gcp Cloud Google cloud and so forth that's basically web 2 right so they're the ones who are holding the keys to the kingdom and they have that data now there's a huge conversation please where I'm from from the valley that that's BS it shouldn't be that way right so there should be decentralization around that and honestly it's not one of those sure but but I'm kind of like getting towards that Evolution so that's the conversation that we're having so giving too much data and control to one entity is just not okay so that's that's that's an ongoing conversation I respect his views I I I know where he comes from for us right that's just the next Frontier for us that's what web3 is it's decentralization of the data we say that hey I don't want to give in my entire control of my company data to a company like Amazon for example Google whatever what may have you and there needs to be better Solutions better technology it's just the next level of infrastructure what Robbie was just talking about that doing the AR VR stuff or the VR stuff in gaming especially it's just not possible without that infrastructure that infrastructure is blockchain so that's just that's just the fundamental how technology is moving and it's just he wouldn't agree and he's quite a you know I was I what what what about that point about data needing to be private I think that um the idea of using a public Ledger for proof of ownership or authenticity is not mutually exclusive from privacy though I think actually one of the key sort of foundational ideas of why people want a decentralized ownership scheme using blockchain is to have better privacy because they have concerns about privacy so I don't think those two things are mutually exclusive I think everybody here wants more privacy so why not store it on a private system then on a private Ledger because the idea of so the idea of having it public is to know that it can be trusted and that way that other people can't modify your data whether it's a centralized Authority or a bad actor because that information is in is is written to a permanent Ledger that's the basic idea tax tax is one of them like companies get hacked Sony was hacked like there's a lot of um you know I can name 100 companies that got hacked so sure data was compromised Equifax but in the in the Gaming Community it's particularly dear to Gamers because there are a lot of Gamers who've played games that you know they love for long periods of time years and then the game developer decides to rebalance the game economy or change the rules inside the game and all of a sudden all of that stuff that they've been collecting or the points that they've won all of a sudden become valueless or change and the players didn't ask for that change of rules and didn't have any say in that change of rules it was just something that the developer did and so I I think what we're trying to do by introducing blockchain into games is to make it more fair to the players so that they're able to have a say in what goes on characterize the the demand that's that's there for like blockchain based gaming because it seems to me that for example anamoka had a metaverse fund that was going to be 2 billion up to 2 billion last year now earlier this you said up to 1 billion I'm not sure if you can give us any sense of what's going on with that and if you if you still have that figure in mind or if you're going to have to scale it back I mean that doesn't seem to necessarily be there was a big kind of a lot of hype around around the metaverse a little while ago and it seems to me that it's already quite like that hype has really fizzled already and the fact that you're having to scale back that kind of project how would you kind of characterize that I mean you're you're running a big metaverse company sure so I think again it goes back to definitions but I think the idea behind building a fund for example to invest invest in people building the metaverse is a very long-term uh initiative so obviously this this is a fund called animal Capital we just started the process and announced the fund around around the beginning of this year so it's early days um and the idea behind it is to support people who are building metaverse projects and they come from our lens and perspective so they're mostly game developers and the thing about building this kind of content is that it takes a very long time and I think that that's something that's often not appreciated by people from outside the industry which is that a good game can take many years to make and and so I think when you see the games in web 3 that are the most popular today most of them began development in 2017 2018. I mean our sandbox product for example which is our most mature product we started development in 2017 and so it takes a long time to make great games particularly when you're using new technologies where you have to really kind of innovate and problem solve because nobody's ever made games with these kind of tools before but if we take out the the blockchain element from it so just like the web 3 definition that I would say you know Mark Zuckerberg might use or the consensus let's be honest I think the consensus outside of maybe this room or outside of you guys is that is that the metaverse is more about the kind of immersive 3D internet than the blockchain right if you um if you take that out I mean in the column that I wrote today actually I'd spoken to someone who was talking about he bought one of these metaquest um Pro headsets that was like 1500 pounds and he's used it three times and he was saying to me that like there's been so many attempts to create these kind of immersive games and there's just not the demand there that's why I'm asking and it's like if you think about a while ago everyone thought that 3D movies were going to be like the big thing and like who watches 3D movies you know what I mean it's like no one actually wants it so that's why I'm just asking is the demand there what would you say so if you define the metaverse as VR games I agree with you I wouldn't invest in it so what is it then if it's this is why this is why it's really tricky to understand that's why I said let's because I thought that it was an immersive 3D experience so I'm asking about the demand that there is for that but you're saying it's not an immersive 3D experience I don't think it's a VR okay immersive I think that it's a desktop game if you've ever played a triple a desktop game it's 3D and it's immersive and you get very engaged in it so I would call that an immersive 3D experience but I don't think it's necessarily VR I think some metaverse experience but that doesn't Define it and how how is the demand looking for that or VR no for an immersive experience oh I mean 3D MMOs are some of the biggest games in the world so are they yeah okay okay sorry that's okay like I'm not a gamer so for us the community is 35 000 strong and growing pretty much but 35 000 is you know I mean it's not for a web AAA rated game I mean it's but that's what I'm saying for a web three game so that's so it's that's not exactly taking the kind of gaming World by storm is it 35 000 players is although you have to keep in mind that you need to rethink what metrics you're considering to look at because audience size is very important in web 2 because the monetization is so bad so when you only make money from two percent of the users who pay and the rest are free and they're only paying you five six cents a month you need hundreds of millions of users in your user acquisition funnel in order to make you know any decent Revenue whereas if you have a game that has a relatively small audience but monetizes at a high rate then you know it's a very different proposition I thought I thought the whole point of the new world was that you don't monetize us the use users who who like get their own money you're now saying it's even more profitable that's kind of what I'm saying what I'm no what I'm saying is that the revenues of the game are enough to support the developer actually wanting to make the game because it has to be a commercial Enterprise but if you look at for example Eve online which is you know arguably the most successful game of all time very few games have lasted for 20 years of continuous operation it has 150 000 users but most people would scoff at the idea of 150 000 users in a game because they're used to Casual free-to-play economics where you need to have tens of millions of years the GameFly angle where users can actually play to earn so that's that's something that's okay that we didn't add in web 2. I would I would we've got 22 seconds left can I just ask both of you what will be the biggest impact of like you know the title of the panel what will be on kind of society we're talking about gaming is that do we need to just think a bit smaller is it is is it going to impact society as a whole in a in a big way I don't think this is going to impact the entire society as a whole uh you know is it's just a way for us to evolve as people and actually have more options to be more immersive like Facebook changed the way we communicate it right and how we connected with peers all around the world and have these conversations and so forth the same thing with messaging apps WhatsApp and Telegram and so forth and whatnot this is just another evolutionary aspect of what the metaverse brings to the table it's just a new way of connecting it like okay forget about the Baby Boomers forget about the Gen Z's and so forth the next Generations that are coming up that's that's how they're going to communicate and that's how they know okay all right well thank you so much and thank you very much thank you guys thanks