7 Essential Ingredients of a Metaverse

Link: https://future.a16z.com/7-essential-ingredients-of-a-metaverse/

Intro

Andreessen Horowitz (a.k.a "a16z") is a big player in the blockchain/web3 investment game. One thing that makes them different from other more traditional VCs is that they employed a big media arm. This article is from Future.com, a newsletter run by them.

This article is the most concise one I have ever read about what is metaverse, what matters, and what doesn't.

Highlights

In many ways, the metaverse is just another name for evolving the internet: to be more social, immersive, and far more economically sophisticated than what exists today.

Yeah, it's an evolution, not a revolution. You can say we are already living in the metaverse today. People compete on the follower number, start relationships online, and collaboratively maintain important Internet infrastructures like Wikipedia.

Decentralization

Decentralization matters. Without it, anyone can get “rugged” at any time — a precarious situation that dissuades people from building on top, hampering innovation.

Decentralization is a means to an end, but not the end itself.

Property rights

Just as courts of law uphold these rights in the physical world, so should code enforce it online. It just so happens that true digital property rights weren’t possible before the advent of cryptography, blockchain technology, and related innovations such as NFTs.

Self-sovereign identity

Identity is closely related to property rights. You can’t own anything if you don’t own yourself.
The cryptography at the core of web3 enables people to authenticate without relying on these intermediaries, so people can control their identity directly or with the help of services they choose.
Standards like EIP-4361 (Sign-in with Ethereum) and ENS (Ethereum Name Service) allow projects to coordinate around open source protocols

Composability

In games like Minecraft and Roblox, you can build digital goods and new experiences out of the basic components supplied by the system, but it’s harder to move them outside that context or modify their inner workings. Companies offering embeddable services, like Stripe for payments or Twilio for communications, work across websites and apps — but they don’t allow outside developers to change or remix their black boxes of code.
By composing together powerful new ingredients like property rights, identity, and ownership, builders can create completely new experiences.

That is why I'm skeptical about most of the so-called metaverse companies nowadays. The walled garden approach is so prevalent in today's business.

Openness/open source

The best programmers and creators — not the platforms — need full control to be fully innovative. Open source, and openness, helps ensure this.
They could also even obviate the need for outdated U.S. securities laws, which were designed decades ago to reconcile the longstanding principal-agent problem and information asymmetries in business.

Community ownership

If any one entity owns or controls this virtual world, then much like Disney World, it may offer a certain form of contained escapism but will never live up to its true potential.
This miracle of coordination — previously unwieldy or not possible without the advent of crypto and blockchains — is orchestrated through the ownership of tokens, the native assets of networks.
Across web3, participants in decentralized autonomous organizations, or DAOs, have taken this principle to heart. They are eschewing the formal rigidity of corporate structures in favor of more flexible, more varied democratic, and informal experiments in governance.

Social immersion

Big tech companies would have you believe that high-powered virtual reality or augmented reality (VR/AR) hardware is an essential — perhaps even the most essential — ingredient in a metaverse. This is because those devices are a trojan horse.

A metaverse does not have to exist in VR/AR. All that’s necessary for a metaverse to exist is social immersion in the broad sense. What’s more important than hardware is the type of activities metaverses enable. They will let people remotely hang out, work together, mingle with friends, and have fun, much like they do using Discord, Twitter Spaces, or Clubhouse today.
Further, because of the economic elements outlined earlier — property rights, self-sovereignty, community ownership — metaverses can enable people to make a living, engage in business, and attain status. In a typical knowledge worker’s workplace, people collaborate using tools like Slack, while outside the traditional corporate world in the bottom-up organizational movement of DAOs, Discord and Telegram prevail.

Exactly. Mobile phones pushed the Internet penetration tremendously. Not because they rendered better games than PC, but because they connected us to others and the real world.

In the end:

While a number of companies have begun building out different pieces of the whole, if a virtual world is lacking in any of the above parts, it doesn’t count as a fully formed metaverse, in our view. We believe — as is evident in this framework — that a metaverse cannot exist without the fundamental foundations of web3 tech.

Closing Comments

I don't believe the future of the Internet is Hedonism or Escapism like most movies depict. (Yes, I'm looking at you Ready Player One.)

Metaverse, as a word, was made up in a niche sci-fi book, then rediscovered by enthusiastic technologists, and finally picked up by the mass. At each stage, some new sentiment is added to it.

Whether you like it or not, people will continue talking about it for a long while. So it's good to get to the same page first.