How Legal Design can help in the metaverse’s regulation?
Our current governance policies are constantly at odds with exponential technological advances, which create an impasse between innovation and regulation. Therefore, we want to propose a legal design framework for regulators. In order to illustrate this method of analysis, we have decided to focus our work on the issue of the metaverse.
Artificial intelligence (‘AI’) combined with Big Data brings an entirely new dimension to algorithms. In the age of the digital economy, business models shifted to online platforms. Data became the most valuable asset in the world. In this frantic race for innovation, AI is developing in all areas of life. AI helps save a life, save the planet, increase productivity, and more applications. Mark Zuckerberg has recently announced that he has the ambition to develop an Internet 3.0 with the Metaverse.
Although it may seem like a rosy picture, these innovations have many uncertainties. To name just a few: how can we regulate a technology advancing exponentially? What is behind those AI systems?
This article intends to be exploratory in the way governments should approach those issues. Therefore, we want to propose a legal design framework for regulators. In order to illustrate this method of analysis, we have decided to focus our work on the issue of the metaverse.
WHAT IS THE METAVERSE AND ITS POTENTIAL CHALLENGE?
According to Mark Zuckerberg, virtual reality serves as a computing platform for living a second life online. You wear a headset that immerses you in a 3D environment and you carry motion-sensing controllers to interact with virtual objects and use a microphone to communicate with others[1].
In this new environment, it will be primordial to fix ground rules. Not only ethical questions but also legal questions arise from various legal domains. Without being exhaustive, we will present a few : the purchase of numeric houses raises questions on property law, the use of cryptocurrencies. Then which law do we apply ? What happen if someone steal NFTs to another ? Or if you discriminate against somebody ?
PROPOSITION OF A METHOD FOR REGULATORS
As you can see, lots of challenges will have to be taken into consideration. In order to regulate those new technologies, we want to propose a framework suitable for regulators based on Legal Design. Legal Design is an innovative method that uses design thinking[2] in the legal field.
1. Empathize and Define
First, it is essential to have a clear understanding (experience) of the segment targeted by the regulation and define the problems you want to solve. You can do it for example by:
– Conducting surveys, polls of relevant stakeholders.
– Creating a harm framework to see where irregularities are emerging.
2. Ideate
Then you should address all those questions.
2.1: Goal of regulation
2.2: Who are the stakeholders ?
2.3: Benchmark: is it possible to learn from other countries ?
2.4: Brainstorming with all the identified stakeholders and selecting the best proposition.
2.5: Resources : what resources are needed to achieve the solutions identified above? Is this doable? Should there be outsourcing? Or cooperation with other states/entities?
2.6: Channel ? – Through which channel will we succeed in implementing the proposals? Soft law? Hard law? etc.
2.7: Cost analysis / Value of design : compare the cost and value of your solutions.
2.8: Key Performance Indicator : what performance indicators allow you to monitor and evaluate the different values of design?
3. Prototype and Test
We are not trying to create a perfect prototype version, but rather several versions that are as close as possible to the problem to be solved. After prototyping, you need to test it with future customers. Here we want to get as much feedback as possible from the users to optimize our prototype. It would be best if you did this until having the final prototype.
This aspect is the least natural part of a traditional regulator. But we think it’s the most crucial part. Indeed, the lack of agility of governments poses many obstacles. This section allows us to act quickly, to be able to ensure certain flexibility and to guarantee the right to make mistakes to come up with better solutions. It is necessary to remember that stakeholders play a vital role in this stage.
BENEFITS OF THIS METHOD
- This regulatory process would allow regulators to issue temporary safety rules and assign liability while products and services are in the beta-testing stage.
- The inclusion of all stakeholders increases the likelihood that potential litigations will be identified early in the process, since both regulators and innovators would have a better understanding of mutual expectations.
- In a design-thinking-based regulatory process, data sharing would no doubt help to ameliorate the regulation[3].
At present, the European Union has not yet proposed any regulation. They first need to better understand the futuristic digital world known as the metaverse before they can decide how to regulate[4]. We can only hope that they will dare to think outside the box and address this regulation in a more creative way.
Aurélien GHOSE
[1] https://www.nytimes.com/2022/01/18/technology/personaltech/metaverse-gaming-definition.html
[2] https://think2make.ch/design-thinking/
[3] Alice Armitage, Andrew K. Cordova, and Rebecca Siegel, DESIGN THINKING: THE ANSWER TO THE IMPASSE BETWEEN INNOVATION AND REGULATION, 2017.
[4]https://www.euronews.com/next/2022/02/08/eu-is-analysing-the-metaverse-ahead-of-possible-regulation-says-anti-trust-chief-margrethe
