The ideas in this writing have been developed over the past year as I worked on Zesty Market and researched on topics regarding The Metaverse. I have refrained from writing stuff about The Metaverse because it such a vague topic that encompasses so many things. It has been a loaded term hijacked by hustlers and scammers leading to lots of noise and little substance. I felt like I didn’t have any novel or unique ideas to share.
However, after working in this space for close to 2 years, I do think my perspective as a builder and speculator in this space might be useful for others. The Metaverse is fundamentally a bet on the way human society will evolve. This article hopes to provide more speculative ideas to think about The Metaverse and the future of human society. The article is going to be lengthy but I hope the ideas would be interesting even if you would disagree with me.
Investing and building towards the Technological Singularity
The Technological Singularity is a term thrown about by futurists in the 20th to 21th century. It also the thesis Softbank’s Vision Fund is operating on. So why is the Technological Singularity or The Singularity such a huge deal and what role does The Metaverse play into it?
Let’s first hypothesize about the Singularity and backtrack possible important innovations that will lead to it, in this article we’ll have a brief look into The Metaverse.
The Singularity is the final machine that human society would have built. While the final machine definition isn’t the widespread definition that is used, it is a reasonable hypothesis to make. The Singularity would be a hypothetical point in time where technological growth becomes uncontrollable and irreversible, as that machine would be able to undergo self-improvement cycles quickly redesigning itself to solve problems. Recursive improvements in light of incompleteness allows such a machine to become a behemoth really quickly, out-classing every other technological invention we could fathom. In the paper Incomplete by Design and Designing for Incompleteness, Garud, Jain, and Tuertscher, highlights the evolution of design in light of recursive improvements, rather than design being a process that leads to outcomes, design is both the medium and its outcomes. The Singularity is thus the infinitely recursive intelligent machine every conceived. While humans could attempt to out-wit or out-design such a system in parallel it would be akin to a lab rat trying to outwit its lab technician.
Machines built by humans are solutions designed to solve problems that we may face. Businesses function in a similar way too, solving problems for paying customers. The process of finding solution to problems is at the heart of design. Design is the cornerstone of important human activity and this creates value in human society. The Singularity makes the design process redundant as this entity would be able to encompass the design processes from understanding problems and addressing problems. It’s the machine to designed solve design. The Singularity is the final machine. It would be the most valuable and dangerous entity humans would ever make. Things get hairy when paradoxical states like wicked problems or undecidable problems are introduced. We don’t know for sure how these scenarios will be resolved but that’s something we’ll find out on a later date.
Being able to solve any arbitrary problems, the Singularity would be every business conceived. Processed leading to the Singularity would lead to value being unlocked, things like Deep Learning despite not being fully generalizable have unlocked significant real world use cases and is very useful at this point. There are lots of other possible intermediate steps and this could be a topic for another article. I do think that The Metaverse is one such stepping stone. We’ll focus on The Metaverse for now and how it can speculatively lead to The Singularity.
What about The Metaverse?
The Metaverse is a vague and open term and encompasses many kinds of digital experiences. At a cursory level, the Metaverse seems to be pretty much like the current internet but with an improved spatial interface.
The term had been coined in Snowcrash by Neal Stephenson. The vague definition makes it really hard to build an investment thesis (where to put money at), or a building thesis (where to spend your time building). There are inklings of what a The Metaverse would look like through initial forays into immersive technologies and experiments with GameFi and NFTs. What more can we speculate about and expect?
The Metaverse is the Hyperreal Society
One thing is for sure, The Metaverse isn’t just about reality. We’re dealing with Hyperreality. The Metaverse is the H𝒚𝒑𝒆𝒓𝒓𝒆𝒂𝒍 society that would both integrate and alongside to our own. AR/MR/VR, denotes the extent of separation of hyperreality to actual reality. The term Hyperreality had been a point of discussion for a number of Post-modern thinkers like Baudrillard. Hyperreality is reality brought to its excesses, where illusions cannot be differentiated from reality. If reality was sufficient we wouldn’t need a digital realm to do things. At the heart of H𝒚𝒑𝒆𝒓𝒓𝒆𝒂𝒍𝒊𝒕𝒚 is simulation and simulacra. It’s the point where we would consider simulated realities to be real or even better than the real thing. The recent speculative fervor over NFTs is a prominent example where the promise of what is to be is more important the actual reality itself.
COVID-19 had accelerated the digitalization of human interactions. Remote-first is now a thing. We primarily interact with representations of real things through screens using applications like Zoom or Discord. None of these had been possible without advances in communication technology and computing hardware. Our virtual lives and activities is now as important if not more important than our physical lives and activities. While Baudrillard approached the topic with much pessimism, we will approach it optimistically instead.
Technologist have already been clawing towards this vision of the Hyperreal society and the concept of The Metaverse in the past decades. A notable area of acceleration is the proliferation of digital products and services notably accelerated by mobile computing. Smartphones had been a hot topic in the past decade and had created significant wealth and opportunities. The ease of use of mobile meant that people are now spending most of their lives online, consuming information and publishing information.
Society is already being digitalized and becoming increasingly virtual. The extent of this Hyperreal society and The Metaverse is therefore not a definite end-state but an evolving process at the moment. I hypothesize that The Metaverse reaches its end game when every possible human experience becomes digitalized. How far more can we digitalize human society further? In many ways, the building blocks of The Metaverse are already here, and we’re going to build more ridiculous things out of it. While immersive technologies do provide interesting business use cases, immersive technologies are able to cater to our innermost desires. Humans need to cope.
Copium
The reason why simulacra and simulations would even be desired at all is because reality does suck. War, pestilences, pain, depression, death, the list goes on. Life is actually harrowing despite the fleeting joys we may experience. Cope is the main driving force for The Metaverse. Businesses wouldn’t need to exist to solve pain points if there were no pain. There are definitely other driving forces like productivity, and work related reasons, so on. However, cope makes H𝒚𝒑𝒆𝒓𝒓𝒆𝒂𝒍𝒊𝒕𝒚 really sticky. It doesn’t matter if the thing we’re dealing with isn’t real, escapism is fun. Further digitalization of the human experience now allows us to treat the human experience as a computational problem. Much of the experiences that draw significant attention on the internet at the moment like internet porn and gaming, for example, are already trying to address need to cope. The next phase of The Metaverse will seek to address these intimate drivers further through more immersive technologies.
Bored? Every single possible game is accessible to you for free or for a fee. Lonely? Pop up a social media/VR app and talk to strangers, sleep in worlds where you won’t be alone, or get an AI Anime Waifu who won’t quarrel with you, or befriend a friendly Vtuber. Horny? Checkout some immersive porn and erotic roleplaying experience. Having Gender Dysphoria? Swap avatar genders, it’s just a flick of the button without the need for surgery. Handicapped or bedridden? Put on your headset and you can experience a virtual world without disabilities. The cope list goes on. Advances in haptics now allow for teledildonics and virtual intimacy (see the anime tiddies simulator below for an example). Every product that can address an area of cope is a valuable business on its own. They’re digital painkillers without the illegal drug trade.
All this can feel dystopian. For realists it all feels like a digital illusion with deleterious effects on society. However, I would argue that these new digital technologies built out of copium will unlock a new form of innovation unlike ever before and would accelerate the rate of innovation and progress further. Distraction and copium isn’t necessarily bad either, VR has been used to reduce anxiety in children who are afraid of injections. Serious gaming and VR is a promising area of research. The emergent morality of the technology’s progress is out of scope for this writing.
Digital worlds offers the ability to have more serendipitous encounters online and to form new relationships that could not have emerged without such mediums. The ability to talk to people and bump into people from all over the world to exchange ideas and do business with the illusion of physical proximity is of tremendous value. It’s a much more natural experience versus talking to faces of people on screens. A market research article by Eventbrite showed that Millenials veer towards experiences, more than 3 in 4 millennials (78%) would choose to spend money on a desirable experience or event over buying something desirable. There’s evidence to show that immersive experiences could develop a wide audience as compelling experiences can be made remotely just through a headset, it may take time to mature as the world gradually adopts more immersive technologies.
Beyond being a better medium of information exchange, The Metaverse and improvements in immersive technologies makes the process of making Design Fiction a cost effective endeavor. Tell experiences, not stories. Designers can design worlds that would not be possible in reality and simulate possible paths of innovation or “what-ifs”. The new immersive technologies at affordable price points will kickstart a Design Fiction-driven economy and would potentially spur greater progress in the way we think about innovation in both physical and virtual domains. While games will be part of Design Fiction, the domain encompasses a wider spread of innovative practices that lead to more innovations. The Metaverse will go beyond just gaming.
The Design Fiction-driven Economy
The idea of Design Fiction popped up in an essay written by Julien Bleecker and was expounded by Dunne and Raby in the book Speculative Everything: Design, Fiction, and Social Dreaming.
Design Fiction is closely related to Science Fiction. In Science Fiction you’re presented a narrative about a possible future. In Design Fiction the possible realities and outcomes are the result of designers and participants in that system. It allows people to reason about speculative futures and experience them in a simulated manner. A wacky example of Design Fiction could be a game world with weird bouncy physics and anti-gravity and people are supposed to transact in it. Other examples that could be considered design fiction would include things like Mark Weiser’s early ideas on Ubituous Computing (ubicomp) and experiments in Xerox PARC which tinker on the edge of possible realities where technologies may not be fully live or complete but simulates a possible reality.
That being said design fiction is not necessarily exclusive from being a design reality, as elements on design fiction can be brought to life in other ways, eg. initial ideas in ubicomp igniting the developments IoT of today, or even the idea of the Metaverse, a topic written in Snowcrash that is now spurring massive innovation is immersive technologies and games. Another notable invention that was brought about through diegetic prototypes was the invention of the spreadsheet. What started out as a daydream by Dan Bricklin and a set of paper prototypes led to the development and invention of Visicalc the influential spreadsheet program which made computers an integral part of the office.
Simulation and play allows people to experience things that might not necessarily be complete, prototyping plays an important role in helping imagine the future. In The Future is Now: Diegetic Prototypes and the Role of Popular Films in Generating Real-world Technological Development, David Kirby explains more about the role of how diegetic prototypes can help allow people to suspend disbelief and experience a world where. Design Fiction allows us to reason about things we may not have a clue about.
Instead of telling stories we can now share worlds that can be experienced by users. It can for once allow humans to share qualia and subjective perceived experiences rather than just tell stories. In ways, stories and writing can dehumanize lived experiences, statistics can occlude true understanding (eg. suicide statistics, casualties from war). If we could experience things in a tangible way it is easier for people to appreciate things. Design Fiction can be thought of as a marketing tactic that deals with our senses in a visceral way.
The Metaverse and immersive technologies that would become increasingly pervasive would make the practice of Design Fiction much more cost effective and immersive. Making diegetic prototypes at higher fidelities instead of just paper mockups to simulate a possible reality will be much more achievable through open source tools like Blender and game engines. What had been accessible to advanced human interaction labs and other research labs is now in the hands of the average individual. The office of the future will likely incorporate immersive experiences to help people with design problems. Like how spreadsheets accelerated digitalization of businesses, immersive technologies will accelerate the development and validation of ideas.
A Design Fiction-driven Economy focuses on using the process of Design Fiction (“what-ifs”) to generate value. One obvious use case of such a practice is the mockup of architectural prototypes in VR. Let users experience a scene and take notes on the experience that people have in it in headsets. This makes deliberating on architecture plans and conveying ideas to people in a tangible way a much more productive endeavor.
GameFi can be seen as a nascent example of Design Fiction — design a game world and design the economics that would govern that game world. The extent of immersion determines how improbable the game world could be as the bottleneck to unnatural experiences is human biology. Ideas and experiments in GameFi can potentially lead to new insights and findings in how we can better improve real world economies. With actual financial incentives GameFi can act as canary systems for other more complex financial systems that takes into account of subjective human behavior.
In addition to simulation, Design Fiction provides Marketers a way to sell or validate ideas. Through games engines and virtual worlds, marketers can simulate an experience of a product before a user would physically experience it. One such example is Rebuff Reality’s Cybershop.
As of now (May 2022), the ability to share worlds and experiences is limited by hardware and game engines. Right now native applications have the best performance, but it’s going to tedious to be downloading a native application every single time you would want check out a new experience. Being siloed into a world ecosystem like VRChat or the Oculus App Store can be limiting. With WebGPU coming soon, and the WebXR API being adopted, it’s likely that the web-first spatial experience will start to be the preferred mode of distributing experiences. It’s permissionless, accessible, and not constrained to a single application ecosystem. It’s no wonder that Meta is looking to develop a web version of Horizon.
It’s hard to predict the incredulous things and innovations that would emerge with a Design Fiction-driven Economy. The limits are your imagination. The next paradigm shift is just a digital dream away. To understand the kinds of digital dreams we can have, we look into the past with The Metaverse Roadmap, a working group made about a decade ago.
The Past: The 2006 Metaverse Roadmap
The Metaverse Roadmap which is a working group that seems dead right now gathered a number of prominent futurists and innovators of their time to provide insights on the Metaverse. The Metaverse Roadmap seemed to have started in 2006 and provides a valuable time capsule in the way people thought about the topic. While The Metaverse had recently re-emerged as the new hyped up topic, it’s not new. Understanding what predecessors have thought about allow us to innovate in newer angles not thought of. I would recommend reading the writings for insights.
One useful mental model that had emerged from the working group is The Metaverse Continua.
On the vertical-axis we have Augmentation and Simulation. On the horizontal-axis we have External and Intimate.
Augmentation adds new abilities to the real world, while Simulation models the current reality or offer completely new environments.
External focuses on the external world. Internal focuses on a user’s identity in relation to the world.
The quadrants aren’t mutually exclusive but are complementary. In the past decade (2010s-2020s) we have seen the rise of various products along those quadrants. Lifelogging is essentially today’s social media and livestreaming networks. We are no strangers to virtual worlds, World of Warcraft, Runescape, Second Life had periods of hype and periods where hype died off. Mirror Worlds manifested themselves as Maps applications like Google Maps. Augmented Reality manifested itself as filters on your social media applications like Snap or Instagram.
Current day Metaverse projects do combine or fall into one of these quadrants. Even if we do play 3D games today, we are mostly interfacing with 3D world through a 2D interface. Mobile gaming, PC, and Console gaming is still much more popular compared to XR gaming as of now.
The unexplored frontier at the moment isn’t going to be another game, but full immersion through VR/MR/AR (XR) technologies. That being said, there are still going to be successful Mobile, PC, and Console games, just that full immersion is an uncharted territory.
The next other uncharted territory is with the organization of digital assets with cryptocurrencies. Cryptocurrencies was not part of the 2006 roadmap, it’s unlikely that most technologists then could anticipate its meteoric rise. The marriage of distributed computing, cryptography, and game theory is an unlikely development. The rise of NFTs stemming from experiments on colored coins is an even unlikelier development. Being a futurist is hard but it’s fun to guess what’s next.
The Future: A Possible Metaverse Roadmap for 2022+
To chart a possible path forward we look at the new ingredients on hand. The two new main ingredients we have in the mix are more immersive technologies as well as cryptocurrencies. There are trends like larger storage capacities, faster networks like 5G, faster compute, but these do not give too much insights on how things can evolve.
Immersive technologies present new forms of computing interfaces leading to unfathomable new products and services arising from Design Fiction as described above. Cyptocurrencies presents a radical alternative in kinds of political organization possible, political organizations built on Cryptoanarchy.
In Snowcrash and Ready Player One/Two, the dystopian scenario is largely a result of an autocratic entity gaining too much influence over the Metaverse. Cryptocurrencies could potentially allow us to avoid this dystopian scenario by decentralizing power. How the decentralization of power would work in practice at the moment is still pretty hazy. In the worst case scenario, it transfers power to a new set of overlords. In the best case scenario, we engineer systems where everyone has a justifiable stake in important systems.
Right now deflationary token based systems and token based governance gives significant power to early holders leading Plutocracy. Quadratic voting could mitigate this but Sybil prevention remains a problem to be solved. . Proof-of-personhood solutions like Worldcoin can feel invasive and dystopian once more.
Further development of more DAOs models interesting experiments in Crypto Anarchistic organization. However, as Anarchy goes it’s usually chaotic and it can be hard to get things done. Apathy is the default behavior. Decentralized Governance (DeGov) is still a WIP. That being said it’s not as if existing systems of governments are perfect either. However, DeGov an open design space and we can expect to see interesting solutions. Solutions like Kleros allow for decentralized arbitration using game theoretic consensus. Developments in DAO tooling have been made: from Moloch DAOs, Compound Governor Forks, Aragon DAOs, Holographic Consensus, NFT based governance, ve tokenomics, and Vitalik’s musings on governance. The community will gradually continue to innovate and find new ways of coordinating. While imperfect, decentralization is a hedge against despotism.
Cryptocurrencies, pose a political counterpoint in the way the Metaverse and the Hyperreal society should be governed. Centralized organizations desire tyranny and control, while Decentralized organizations tend to anarchy and freedom. The initial end state of The Metaverse predicted by books like Snowcrash was for it which is entirely controlled by a single entity. However, through crypto we can engineer systems where everyone could be equivocal stakeholders.
The ability to own digital property in public ledger that the world accepts will usher a new era of digital wealth for creators. It’s much more profitable to be a creator in web3 at the moment. In the State of Crypto report by a16z, creators have made a significant amount of money through projects like OpenSea, yielding $3.9billion, compared to the $1billion earmarked by Meta through 2022. Cryptocurrencies will emancipate the “digital serfs” of web2.0. Digital property rights will usher in a new era of digital wealth creation for the average person. Ideas and memes are the valuable crops of the digital era and now creators will have rights over them which they can control autonomously.
With this power structure that is emerging, new opportunities will start to emerge. The next wave of opportunities in the Metaverse will involve developing new services or tools for a new emancipated creator class, and increasing the capital efficiency of new assets that would emerge.
Value Capture
To understand better the kind of opportunities that will arise from The Metaverse it’s best to understand its commodities: Attention and Content. Attention is attracted to the latest interesting things and Content is always looking for Attention to be able to monetize and to gain a following for clout. Like Yin and Yang, these two commodities underpin the products, services, and infrastructure that should be build. The stack which is able to capture these two commodities the best will eventually be the gold mine of The Metaverse.
Attention and Content being king is not too different from existing web2 media and games, but now we have web3 and cryptocurrencies for value capture, redistribution, and governance. With the encapsulation of digital objects as NFTs we are able to create new creator oriented financial primitives. If you look beyond the JPEGs, NFTs can do so much more. NFTs allow for new financial primitives with NFTs loans and underwriting (NFTfi and Goblin Sax DAO), or NFT rentals (Rentable, ReNFT), or Cashflow NFTs (Zesty Market). Everything is early though and it’ll take a while for their adoption. The Metaverse built on web3 is a much financially interesting avenue for digital creators and builders as it is the first time we see the emergence of creator-owned sovereign digital assets. Web2 native companies are forced to adapt to become more “Web2.5” as a result of the upcoming competitive landscape.
The Metaverse Layers diagram is a good model to showcase the possible stacks at which Content and Attention would be captured. The model can be slightly misleading as dependencies like Games might not be dependent on layers like the Metaverse Substrate. For example, Axie Infinity is built on Unity but not on a Metaverse Substrate like Sandbox. While the levels may not make too much sense like the OSI model the diagram is still a useful chart of possible avenues for value capture. It is mainly content, experiences, and additional structures that derive value from experiences.
As of now we have yet to see more speculative design and design fiction driven enterprises, though organizations like Metaverse Architects and Metaverse Builders DAO show inklings of what value creation through design in the Metaverse could be like.
Given the diagram above it’s seems to be the case that competition will be the dominant driving factor. People have finite amount of attention and time and can usually commit to a few Metaverse Substrates of Game Engines for the matter. However, without significant co-opetition and possible game theoretic stable collaboration states, we might fail to unlock further value that are collaboration dependent.
Inter-operable avatars are one such area that benefits from co-opetition, engines allowing for similar avatars enjoy the possibility of a shared user base and mutual growth. What would it take to create the 3D version of Gravatar in the Metaverse? Would DAOs be the bridging solution for adversarial collaboration? This is still another WIP. Right now it does seem that selfish value capture into distinct ecosystem will dominate, leading in a winner takes it all scenario — the dystopian Metaverse scenario that we would seek to avoid.
Conclusions: The Metaverse as a building block of The Singularity?
Beyond the society and economic impact that The Metaverse creates, The Metaverse digitalizes the human experience. As such, the human experience can be modeled as a computational problem. I hypothesize that The Metaverse fully matures once every single human experience becomes digitalized.
The Metaverse will help build the future AI models with a flood of worlds/environments and more interaction data. Human society is now a problem that can be addressed by information science to a degree much more pervasive compared to what text based social media has offered. Virtual worlds and digital experiences make the data collection much more convenient and accessible.
The actual manifestation of a Singularity is still very much hypothetical. However, we can expect improved tooling in AI with the surge in data driven by Metaverse experiences. This makes it viable to train transformers on spatial information through virtual worlds created, maybe a future iteration of GPT-3 or Dall E will be able to generalize to Computer Vision tasks well in addition to textual tasks? And as such, it can help assist human designers to create more experiences easily leading to more data, ad infinitum. It’s an open research frontier, and I hope to see more innovations in the area.
These are my speculative insights on The Metaverse. While The Metaverse isn’t new it has been revisited from time to time as people speculate on the topic through the process of Design Fiction. Until we actually manifest the Singularity and the Final Machine, we will build on and see what comes next.
Special thanks to littlebigepic, 0xren_cf, AutomataEmily, dax for reviewing the essay.
