Heavy research report (1): What is the value of blockchain, virtual currency, NFT, and Metaverse?


In 2009, the first genesis block was born, starting the first year of virtual currency. Subsequently, blockchain technology began to be gradually applied and stablecoins were quietly born. Beginning in 2015, the “use-based, equity-based” tokens issued in ICO, IEO, STO and other modes began to enter the public eye; at the beginning of 2019, NFT digital collections, chain games GameFi, DAO, Web3.0, Metaverse and other new field of. These new concepts and new ways of playing can be described as changing with each passing day, one after another, endlessly emerging…

For more than ten years , the series of social phenomena surrounding virtual currency have any value to society?

Author: Beijing Yingke (Shanghai) Law Firm

Head of Digital Economy and Fintech Legal Services Team

Lawyer Liu Lei


1. All beneficial phenomena must return to value! 3

(1) What is the value of virtual currency? 3

(2) What is the value of blockchain? 5

(3) What is the value of NFT digital collections? 7

(4) What is the value of the Metaverse? 8

2. Create, consume, hype, and commit crimes, analyze the virtual world industry ecology from four perspectives 9

(1) Research on the industry ecology of virtual currency 9

(2) Exploration of the industry ecology of blockchain 12

(3) Industry ecological research on NFT digital collections 13

(IV) Metaverse’s Industry Ecological Research 15

3. How to clean up the source, break the unhealthy trend of “bad money drives out good money”, and shape the innovation value of the industry 16

(1) Classify virtual currency and NFT products, and clarify their legal attributes 17

(2) Cooperate with multiple government departments to establish a normalized supervision model 19

(3) Relevant government departments guide and support the development of the industry in the scenario of “innovation and creation” 19

1. All beneficial phenomena must return to value !

( 1 ) What is the value of virtual currency?

From a global perspective, there are as many as 10,000 virtual currencies circulating on the market, and their total market value is as high as trillions of dollars. With such a volume of virtual currency, what benefits can it bring to social development? Before answering this question, we first need to classify virtual currencies. The author has made the following classifications based on his practical experience and the current market conditions of virtual currencies; the first category: mainstream virtual currencies , such as Bitcoin and Ethereum ; The second category : stable coins (here mainly refers to mortgage-type stable coins); the third category: use-based and equity -based tokens issued in accordance with the securities laws and relevant laws of the country where the coins are issued .

After clarifying the basic classification of virtual currency, we will answer: “What is the use of virtual currency for the development of society?” The author looks at virtual currency from the perspective of “usefulness”, and believes that there are three main points:

First, the universal application of mainstream virtual currency and stable currency can break the monopoly of the US dollar as the global trade settlement currency to a certain extent, restrain the US over-issued currency to a certain extent, and “cut leeks” (that is, inflation) to the world. The risk is grafted to other countries around the world); in addition, in the political relationship of countries, virtual currency and stable currency can become effective confrontation tools to a certain extent. On March 18, 2022, Duma member Alexander Yakubovsky, who is a Russian legislator, pointed out that the cryptocurrency sector is an area in which it is difficult to impose restrictions on Russia, and the effective development of digital financial assets will minimize the damage to state sanctions; 2022 On March 25, 2018, according to the CCTV 2 economic information broadcast program: “Russia is considering accepting Bitcoin to pay for oil and gas exports.”


(Figure 1: Source baidu)

Second, the use of virtual currency in the process of international trade settlement promotes the convenience of cross-border trade , reduces import and export-related costs to a certain extent, improves transaction efficiency, releases market vitality for cross-border commodity trade, and provides global promote the prosperity of the market economy;

Third, the project party follows the securities law of the country where the currency is issued and the use-type and equity-type tokens issued under the regulations of relevant laws and regulations, which are similar to traditional companies listing and trading company stocks on exchanges. In the traditional financial field, if the industry can insert the wings of finance, it can create further prosperity of the real economy. Since the Amsterdam Stock Exchange (AEX) became the first stock exchange in the history of the world in 1609, about The question of “why companies choose to list on exchanges” has become a topic of research and discussion. The author tries to explain this problem from three scenarios:

Scenario 1: Suppose there was a village with 100 people, each of whom grew crops, and each person created an average income of 10,000 yuan a year; then, the income of the entire village is 1 million. Now, there is a very thoughtful Zhang San in the village who is going to purchase modern equipment to grow crops on a large scale, so he borrowed the income of 10 villagers for one year and used the 100,000 income raised by him to start the business. A year later, Zhang San created a profit of 500,000 through the start-up capital of 100,000. As a result, the entire village has created an additional income of 400,000 yuan. This is the simplest financial scenario of borrowing, and industrial creation is carried out through idle funds in the market.

Scenario 2: Now, Zhang San not only grows crops with large-scale modern equipment, but also wants to engage in construction and real estate, so he hopes to raise funds through the villagers, but there are only a dozen people who are willing to trust Zhang San , How can more villagers trust Zhang San and give Zhang San the idle funds to start a business?So, Zhang San thought of a way to “share”, let the villagers contribute to work together, and the money earned will be divided according to the investment share.

Scenario 3: However, the construction and real estate industry is not as good as the traditional “crop planting”. The initial capital investment is huge, and the return cycle is relatively slow. Because the villagers live in poverty, they often need funds to deal with some unexpected situations. What should we do? ? If you need money urgently in an accident, should you force Zhang San to repay the money, or let the company go bankrupt and liquidate? Faced with this predicament, Zhang San came up with another way: to set up an exchange in the village to trade the shares of the construction company he created, so that the villagers could not only realize the funds in case of emergencies, but also At the same time, it ensures that the enterprise can develop for a long time with the help of the idle funds of the villagers. The Dutch East India Company used this model to create a splendid history of the Dutch financial market and made great contributions to the economic development and international political status of the Netherlands at that time.

The difference between the above three scenarios is that: stock listing is for equity investment, and equity investment is for private lending, the ability to raise funds is stronger, and the possibility of using idle social funds to create social wealth is stronger. The author refers to the above model of empowering real enterprises through finance as “transferring flowers and trees”.

Comparing with today’s virtual currency project party’s use-based and equity-based tokens to raise mainstream virtual currency from the society, we explore the “value” of its existence. Compared with the IPO listing of enterprises in the traditional financial model, the project party follows the use-type and equity-type tokens issued under the securities laws and relevant laws and regulations of the issuing country. The virtual currency project party expands the scope of investors to the whole world, further Strengthen the ability of enterprises to raise funds. In the early years, Chinese Internet companies went overseas to list on the Nasdaq, because they were optimistic about the strong ability to raise funds brought about by the prosperity of foreign stock markets.

( 2 ) What is the value of blockchain?

As an innovative technology, blockchain can certainly exert positive value as long as it can be used in the correct applicable scenarios. At present, from the perspective of the incentive mechanism of the blockchain, the blockchain can be divided into the following two categories: one is “blockchain with Token (token) as an incentive mechanism”, and the other is “without Token as an incentive” mechanism of blockchain”. The representative of the blockchain with Token as an incentive is “Bitcoin and the public chain that maintains the normal operation of Bitcoin”; the blockchain without Token as an incentive is mostly reflected in the alliance chains constructed by government affairs, enterprises and other organizations, such as “Changan Chain” , Wenchang Chain, etc.”

As a technological innovation, blockchain, like 5G, artificial intelligence, Internet of Things, and cloud computing, is the embodiment of technological progress. The blockchain was born to solve the problem of “decentralized collaboration”. The application of decentralized technology can be used in scenarios such as “improving collaboration efficiency, improving confidentiality, and confirming digital asset rights”. A blockchain with Token as an incentive is similar to building a trustless blockchain network, and the network itself feedbacks the contribution made by the co-builder in the form of Token, and passes the proof of each person’s work through the secondary Market transactions to allow participants to get paid; blockchains without Tokens as incentives are essentially paid by specific bosses to those involved in blockchain construction, but this blockchain technology is distributed through distributed The server stores data to ensure that no centralized independent third party can manipulate the data, which solves the problem of trust mechanism.

Regarding the role of these two blockchains in social development, the author tries to describe two scenarios to explain:

Scenario 1: We use such a convenient map navigation today. In fact, we spent a lot of money through early map development companies, hired professional personnel, and prefabricated professional equipment. It cost billions to build, and it was the first time to start map development in our country. The project company is the well-known “Gode Map”.

In fact, before AutoNavi started to collect real-world data offline, many map companies also had this idea, but they suffered from the huge workload, such as the need to call and manage a large number of participants; It is also difficult for enterprises to make profits by collecting data in a short period of time. These two factors have led to the retreat of many companies with this idea, which makes technological innovation that is so convenient for the people today and of great value to the society stagnate. The pace of realizing the real-life data construction of every street and every community in the country is still slowing down. Through this case, we can imagine that if there is a project in the real world that is of great value to the society, but requires huge funds or personnel to participate in the development and construction, in the case of lack of funds and personnel in the early stage, whether it can pass the district Blockchain technology to solve this problem?

For example, AutoNavi released an announcement calling on people from all over the country to participate in the collection of map real-world data without pay in the early stage, and then issue a “Proof of Work” (POW) based on the collected data, which can be used as free or discounted use The future projects of AutoNavi Maps; or the future projects of AutoNavi Maps are profitable, and you can participate in the project profit distribution with the proof of work; at the same time, once the AutoNavi Map project is completed, the proof of work is similar to that of stocks and can be obtained in a special secondary market ( Exchange) to list and trade, allowing participants to profit from it. In this way, Gaode Map can cost almost no cost in the early stage, and can call on such a large number of participating groups to jointly build matters of great value to the society; at the same time, it will not make the participants profitless. The personnel involved in the project construction are similar to the behavior of investment. Once the project is successful, they can enjoy the right to use the project and the right to benefit from the work certificate, and can also trade in the secondary market, which may be more beneficial than the initial payment and remuneration. many.

Scenario 2: Our country’s civil law divides “things” (commodities) into “movables” and “real estates”. The ownership of “movables” is mostly achieved through “possession”, that is, you control it, it It belongs to you; legally, “real estate” is about registration. As a credible third-party government property rights registration department, the property rights exchange center registers that the house belongs to you, and it is yours. So, how to identify who the virtual data belongs to? Everyone knows that once intellectual property rights such as trademarks are presented in the form of virtual data, they can be registered and confirmed by the relevant intellectual property departments established by the state. However, if the virtual data does not meet the relevant standards of intellectual property protection, but it is also valuable, how to confirm its rights? It seems unrealistic in terms of workload and efficiency in the use of administrative resources if it is expected that a government with reliable credibility will register all virtual assets and declare their ownership. Here, blockchain technology has done it ; Whether it is a blockchain with or without Token as an incentive mechanism, their principle is “trustless network”, that is, the assets on the chain are confirmed through consensus mechanisms such as POW and POS (Proof of Equity), and the entire network is disclosed. Announcements, whose security is ensured by the entire network. Finally, the virtual asset is connected to the username in the form of a hash value through a public and private key. Today, the popular NFTs, game equipment in chain games, land, and virtual assets in the Metaverse use this principle.In layman’s terms: the physical form of virtual assets, as a string of numbers, is naturally reproducible and easy to tamper with, but blockchain technology endows it with a special set of production, traceability, and recording methods, which can be issued for these virtual assets. “Proof of Identity” and “Circulation Records”. Therefore, mastering the Token that identifies the “identity certificate” means theoretically the ownership of the virtual asset, but there may be differences with the theory of “property law” in traditional civil law.

Through the description of the scene, we can intuitively feel the implementation of the blockchain decentralization technology, which can be used as a special collaborative method to solve the problems of efficiency, cost and trust that are difficult to solve by centralization; in addition, in the digital assets In terms of right confirmation, blockchain solves the disputes over the ownership of digital assets that are difficult to solve by traditional methods; this is the benefit and value of this technology, but technology is also a double-edged sword. No matter how good the technology is, it must be combined with beneficial The scene can play a positive social effect.

(3) What is the value of NFT digital collections?

Since the concept of “virtual assets” was born, we know that a string of virtual data codes as a carrier has transitioned from pure information transfer to value transfer, becoming a carrier of value; thus, what kind of mission does a string of virtual data carry? , what kind of market value it has. As blockchain technology can issue the only credible “identity certificate” for virtual data, another question worth pondering arises, that is, whether this string of data can carry the value of “art collections”, so that this A string of data becomes the carrier of artwork, does it have the attributes of artwork?

For example, we scan the two artworks of Van Gogh’s masterpiece “Starry Sky” and Da Vinci’s “Mona Lisa” in the real world into virtual pictures, and confirm the rights of the virtual pictures on the blockchain; then Identify the “identity certificate” of the virtual picture on the blockchain, and then conduct market transactions. Then, from scanning physical paintings, turning physical paintings into virtual pictures, and then registering and confirming rights on the blockchain, the holder of the “identity certificate”, that is, the owner of the virtual painting. If the “identity certificate” is traded at a sky-high price through market transactions, it is even close to the market price of the real physical painting. How should we understand this social phenomenon? What are the benefits and values ​​of this phenomenon for social development?

Before answering this question, we must first think about: what is the logic behind the recognition of sky-high artworks by the market, and what is its beneficial value to society? Regarding this issue, the author has discussed with economists, and it is mainly based on the basic economic principle: “The price of commodities fluctuates around the value”. Behind the high price of the art market, it must be that the art has a specific effect on the society. Value; for example, Van Gogh’s “Starry Night” cannot be estimated by direct use value, but the impact of this artwork on culture is obvious to all. Some experts pointed out that the value of artwork itself includes physical value, artistic value, cultural value, historical value and economic value, and the values ​​are relatively independent. The most basic value of a painting is its own cultural connotation, including artistic value, historical value and aesthetic value, as well as the artistic inheritance, historical changes and aesthetic experience embodied by it. So, if you ask whether virtual artworks can carry the artistic value of physical artworks, I believe most people are sure. Whether it is physical paper or virtual code, just as a carrier of art works, the artistic value it reflects will not change.

In addition, as for real artworks, virtual artworks have more advantages than real artworks in terms of artistic inheritance and cultural dissemination due to the characteristics of their data carriers. This is why NFT can set off waves of virtual art transactions.

(4) What is the value of the Metaverse?

In the past year, the concept of “Metaverse” has been on fire. In practice, it can be roughly divided into these versions:

1.0: With the continuous improvement and application of VR and AR technology of “virtual reality and virtual simulation”, the use of scientific and technological means to link and create, through the virtual world and the real world to map and interact, the specific performance is: VR, AR The new experience brought by related equipment and products.

2.0: With the popularity of the GameFi market, products, equipment, land, characters, skins, etc. in online games can be used for transactions and hyped up for high market prices after being confirmed through blockchain and turned into virtual assets. Many players profited; therefore, the market kept advocating, tempting people in the real world to enter the world of the Metaverse to invest and consume.

3.0: With the entry of top luxury goods LV and sports brands Nike and Adidas into the Metaverse, combining the product features in the real physical world, creating a virtual space of its own brand, guiding consumers to consume virtual products in the virtual world; at the same time, it also indirectly serves as a reality Business scene in the world for backward flow and marketing promotion.

4.0 The Metaverse in people’s minds is closer to the sci-fi movies “Ready Player One” and “The Matrix”, which arranges people’s creation and consumption in a virtual world, which gives countless people a dreamy imagination; because in the real world Even if I am a beggar, I can become a king in the Metaverse world and experience another life.

Professor Shen Yang from the School of Journalism, Tsinghua University said, “Metaverse itself is not a technology, but a concept and concept. It needs to integrate different new technologies, such as 5G , 6G , artificial intelligence ,big data , etc., emphasizing the integration of reality and reality.” (See “Professor Shenyang, School of Journalism, Tsinghua University: The Metaverse May Account for One-third of the Total Economic Scale in the Future”, https://baijiahao.baidu.com/s?id=1722647549124930183&wfr=spider&for=pc) There are the following core technologies: First, extended reality technologies, including VR and AR. Extended reality technology can provide an immersive experience and solve problems that cannot be solved by mobile phones; the second is digital twin, which can mirror the real world into the virtual world. This also means that in the Metaverse, we can see many virtual avatars of ourselves; the third is to use the blockchain to build an economic system. As the Metaverse develops further and the simulation of the entire real society is strengthened, we may not only spend money in the Metaverse, but may also make money, thus forming an economic system in the virtual world.

What is the value about the Metaverse? The author believes that as one or a series of technological innovation scenarios, it can improve the production and life efficiency problems in the real world and bring positive value to social development through the “combination of virtual and real” methods ; Virtual simulation technology can allow medical students to complete difficult medical experimental teaching in the absence of sufficient experimental specimens; in addition, from the perspective of consumption: if the scene of the Metaverse can highly restore the physical scene, just like Disney’s ” “Flying Over the Horizon” project achieves the effect of immersive experience of outdoor beauty without leaving home, and even creates a surreal dream scene, which can bring people a good consumption experience.

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