Wu Tong: The Internet is too convoluted, we need Metaverse

Editor’s note: Not long ago Zuckerberg announced that Facebook will be renamed “Meta” and enter the meta universe. Then within a week, both Microsoft and Nvidia put forward their own meta-universe ideas, which caused a lot of waves in the stock market. “Meta universe” is attracting the attention of the ideological, technological, capital, corporate, and cultural circles. On November 6, 2021, Weicao Zhiku planned the 119 session of the Zhiku Salon, inviting Wu Tong, a blockchain and digital economist, to share “The Internet is too complicated and we need a meta-universe”.

The following is the speech record:

Hello teachers! Hello, friends! Today, I will mainly talk to you about the business, social and cultural logic of Metaverse and Metaverse that I understand.

At the beginning of this year, I participated in the investment of several meta-universe projects, and I also closely followed the progress of meta-universe in the world. The meta universe is a new thing. “1000 giants, 1001 meta universe”. Everyone understands things differently, or that the meta universe is a brick, and you can move it wherever you need it. When everyone wants to do a thing of their own, as long as it has something to do with digitization, it seems that it can be put into the scope of the meta-universe.

Many people say that Metaverse has a progressive relationship with the Internet. This is indeed the case. The meta-universe is not a separate concept. It actually overlaps with many concepts, such as Web3.0, DeFi, and DAO.

1. What is Metaverse

Is Meta universe old wine in new bottles? There is a lot of discussion about this. A very central question is how to define the meta-universe. Because if the definition of the meta universe is different, then the meta universe we understand is not one thing at all, it may be many things.

Recently, the meta-universe fire on a global scale is mainly due to the change of Facebook to Meta. In fact, in the concept of meta-universe that I understand, their addition is at best the icing on the cake, and this meta-universe is not a meta-universe in the true sense, or it is not a meta-universe that I understand. I believe that the meta universe is a digital world that runs parallel to the real world. If a world is completely dependent on another world, or has no independence at all, then it can hardly be called a digital world.

Many people ask, what is the difference between the game chain in Metaverse and the current game? The difference is still great. For the participants, if we can achieve a meta-universe in a relatively ideal sense, it is equivalent to restarting life.

We cannot choose which country we were born in, which city we were born in, and what kind of family background we are. Although we can change some things through acquired learning, there are still many things that cannot be changed. In fact, from birth to the end of life, many times it is like a game process. In this respect, the meta universe is equivalent to restarting life. This is why the valuation is so high now, because it gives us an ultimate definition, which is whether we can live a new life.

The meta universe is characterized by sustainability, openness, autonomy and immersion. Of these four characteristics, I think the least important is actually immersion. As I said earlier, I don’t think that the meta-universe mentioned by these Internet giants is the meta-universe I understand. Why? Because they tend to emphasize immersion, and in my opinion, immersion is the least important. It is nothing more than improving the user experience through AR, VR, and MR technologies. This is actually just some changes in the “technical” aspect, not a change in the “dao” aspect.

2. The Internet is too rolling: we are rolling in Web2.0

If the Internet is not so volumetric, we will not collectively be so high towards the meta-universe. Where is the Internet rolling?

First, our data does not belong to us. In recent years, the proposal to incorporate data into production factors has not been achieved, and it is far from being achieved. But the metaverse provides a solution that at least seems to work.

Second, the Internet not only monopolizes business scenarios, but also monopolizes information and logic. Monopoly of information and logic is even more important, because most people actually seem to get a lot of information, but they don’t have the ability to think independently, and they are often trapped in the “information cocoon.” The meta universe is on fire and everyone is talking about it, but many people may not understand it, and they are often guided by other people’s thoughts.

Third, the Internet is not interconnected, and there is a tendency to become even more disconnected. Especially when combined with our international situation, this trend will become more apparent in recent years.

Fourth, the diminishing wealth effect of the Internet cannot bear the dreams of young people. Because the Internet in 2016 to 2017, after the end of the dividend of the mobile Internet, in fact, there has not been a point that has made the entire industry collectively high for several years, so it has not produced a relatively strong wealth effect. Because any new technology, new ecology, or a new technology cluster replaces the revolution, it must have a strong wealth effect.

However, in recent years, the wealth effect of the Internet has actually been reduced. Of course, many digital giants have continued to appear, and a small number of people have also achieved a leap in wealth. But in fact, its scope of influence is not that large, far unlike the wave of mobile Internet, including the wave of traditional classical Internet of the previous generation. So everyone has been suffering from the Internet for a long time, at least for a few years.

There is a certain degree of overlap between the meta universe and many concepts, such as Web3.0. Because we are still essentially at the Web2.0 stage, there is still a lot of work to be done to Web3.0.

Wu Tong: The Internet is too convoluted, we need Metaverse

Now our state is that most of the information can be read and written, but the value can only achieve limited sending and receiving, and the data does not belong to us. In other words, we can see information, but the value does not belong to us. Moreover, our data security and data privacy cannot be well protected. So under this circumstance, we are moving towards the meta-universe, in fact, with Web3.0, it can be regarded as a parallel development relationship.

3. The goal of the meta universe

In my opinion, the goal of Meta Universe is a systematic and complex digital world based on a variety of digital technologies. This world can realize data confirmation, pricing, trading, and empowerment. On the server of a certain Internet giant, he wants to delete the data, or he wants to arbitrarily add roles and create some wealth. This is not enough. The meta universe is objectively existing, open source, dynamically evolving, and user-oriented. It is essentially an artificial digital parallel world.

How should you understand the concept of “parallel world”? Parallel worlds cannot be said to be one world totally dependent on another world. It can be said to be derived from this world, but after all, it must have a certain degree of its own independent operation value, otherwise, it will become a vassal of another world. In this case, it does not conform to the concept of parallel worlds. So property rights and governance are very important.

4. The “Dao” and “Technology” of the Metaverse

I have a clear opposition to the big Internet route, but I don’t exclude Internet giants from joining. Internet giants can be a relatively important ecological participant, but if he wants to do it entirely based on his original ecology, or he wants to engage in monopoly, this path must not work.

The technology groups involved in Metaverse include AR, VR, 5G, cloud computing, IoT, blockchain, artificial intelligence and so on. I also mentioned just now that all kinds of immersion are just “techniques” in my opinion, and sustainability, openness and autonomy are the “Tao”. The key to achieving “Tao” lies in the blockchain. In my opinion, “Tao” is the soul core of the meta universe.

Basically, the entire Internet industry has reached a FOMO stage. Everyone wants to participate and is afraid to miss this wave. But in fact, most of them paid attention to the level of “shu” and ignored the level of “Tao”. In other words, they think that the “Tao” level is difficult to achieve in a short time. In order not to fall behind, they choose to start from the “technical” level. But such a meta-universe will develop very serious problems later.

Five, the two basic construction routes of the meta universe

The first route is the “big Internet route.” Large-scale Internet platforms rely on their existing traffic, data, and scenarios, including hardware reserves, technical reserves, etc., to build a meta-universe based on their own ecology; the second route is to build several open-source meta-universes on the blockchain. And realize interconnection and intercommunication through cross-chain. I think this approach is more in line with the nature of the meta universe.

The “Great Internet Route” of Meta Universe has many drawbacks. The first drawback is that it is too centralized. If it is said that the Internet giant itself has problems, or that he wants to create or delete some characters, users have no ability to compete with the giants. Moreover, as the parallel digital world of the real world of human beings, the meta universe should represent the interests of the community of shared future for mankind, rather than being the final say by individual giants.

Many countries are also formulating or have formulated the industrial policy of Metaverse. For example, American companies are urging the US government to formulate a meta-universal policy. South Korea has already appeared in the meta-universe alliance of such giants. South Korea is very radical in the meta-universe industry, the blockchain industry, and the cryptocurrency industry. Japan is also beginning to formulate some policies, and Japan is also very radical. In the entire concept of aggregation, including cryptocurrency, Web3.0, DeFi, Meta Universe, etc., South Korea and Japan are very radical.

The second drawback is the inability to solve the problem of data governance. In 2019, Facebook wanted to release the global stablecoin Libra , which was later renamed and called Diem, but it has not yet been launched. In fact, I talked about this at the time. It doesn’t matter whether it is launched or not, because he has already told the world that we can still do such a thing. There are actually many stablecoins that perform similar functions as Libra.

In 2021, this number has achieved an order of magnitude increase, and the transaction volume has reached the trillion-dollar scale, which is a very large scale. Therefore, the meta-universe of the “big Internet route” cannot solve the problem of data governance. The anti-monopoly of the digital economy will still be a problem they cannot avoid in the future. Anti-monopoly in the digital economy is also a global trend.

The third drawback is that it is difficult to solve the problem of interoperability. This is actually an old problem of the Internet. Different games, social interactions, and animations will form different IPs. It is difficult to achieve interconnection and interoperability in the construction of meta-universe based on different IPs. For example, in animation, we can have the meta universe of “One Piece” and the meta universe of “Dragon Ball”. But if both metaverses develop, it is difficult for us to imagine how Lu Fei and Monkey King would communicate. This will certainly be the case in the future, either through blockchain cross-chain or through the user’s re-kneading a meta-universe, which can realize the roles between different meta-universes in the same meta-universe. The second method is very costly, and it is better to implement cross-chain based on the construction of blockchain from the beginning.

This meta-universe based on the emergence of blockchain can solve the above three shortcomings, or in other words, these three shortcomings will not appear. Its advantages are:

First, it is a more decentralized system. I published a book in September of this year called “Chain Government Economy: How Blockchain Serves the Country and Governance in the New Era”. I also proposed two models: one model is if the chain government economy is a kind of public governance. Mode; the other is that if the meta-universe is constructed based on the blockchain, it is a market-based approach. Market and government are two models.

If Metaverse is done by the Internet and has a strong monopoly color, this approach will be difficult to work in the future. If we do it in a market-oriented way, it is a very conducive approach. Just now I said that South Korea and Japan have formulated industrial policies, and it may be too early if the public sector is required to intervene, and the direction of development is still difficult to determine. Instead of intervening prematurely, the government should give the market more room.

Compared with the meta-universe that we think about now and the meta-universe that will be formed five or ten years later, it is very likely to be wrong. Because the future we can foresee now may only be 2 to 3 years, or even shorter. We just have a relatively vague concept, and we know what general direction the industry is heading towards. But in fact, many abnormal changes will be discovered during the development process, so that the meta-universe we think of today and the final meta-universe formed a relatively stable state must be different. So at present, it should be a more reasonable way to build and develop the meta-universe through the market.

Second, data governance can be achieved. Simply put, data can be incorporated into factors of production, and data is the first factor of production.

Third, based on the core assets of the blockchain, a broad consensus has been gradually formed on a global scale. What is the importance of this? It is that the assets of Yuan Universe have a relatively strong accumulation. Based on the blockchain-based meta universe, the core assets are actually mainstream encrypted assets. Mainstream crypto assets have begun to be recognized by more mainstream financial institutions worldwide in the past two years, including by some government departments, and their total market value has exceeded US$3 trillion. In terms of technology, various branches of blockchain technology are developing.

At present, based on the blockchain metaverse, its infrastructure is basically Ethereum, SOL , and FTM, which are relatively mainstream public chains. Whether it is from the perspective of asset reserves, from a technical perspective, or from an ecological perspective, they are relatively mature. Under the construction based on the blockchain, the problem of “meta universe island” basically does not exist.

However, although I am more opposed to the “big Internet route”, it does not mean that Internet giants have nothing to do in the meta-universe ecology. They are still important contributors to the ecology. Because they have an irreplaceable role in the underlying technology, traffic entrance, and scene construction. The objection is that they are completely based on their own ecology and directly construct what they think of as the meta-universe.

In essence, this will only intensify monopoly, intensify the involution of the Internet, intensify users’ lack of independent thinking ability, and intensify the deprivation of data rights of users by giants, and so on. In fact, this time Metaverse has aroused extensive discussions around the world, and it is directly related to Facebook. Their leading role and publicity role are very prominent and obvious.

How to realize the interconnection of value and information between the meta-universe world and our real world? The information dimension is mainly the oracle, which is a very important mechanism. The value dimension is mainly stable currency and legal digital currency.

The most noteworthy progress this year is the development and rise of algorithmic stablecoins. Because algorithmic stablecoins existed in 2019, but at that time, the industry felt that algorithmic stablecoins were a Ponzi scheme, which was completely inanimate. But this year, algorithmic stablecoins have seen great developments. This means that Metaverse can create a legal currency that is relatively stable with the real world through an algorithmic mechanism. This is a very gratifying development.

6. Metaverse helps establish a digital labor paradigm

The meta universe is actually at the level of “Tao”, and it is more of an impact on economy, society, and culture, because it itself is also a product of these three.

From 2019 to this year, the establishment of a digital labor paradigm has become very obvious. At present, Metaverse provides us with some new options that are different from the previous ones, such as P2E (Play to Earn), which is to make money in entertainment. Including some GameFi represented by Axie Infinity, and SocialFi represented by Mirror and FWB (Friends with Benefits).

In addition to the culture and hope that everyone has their own data, there is another kind of thing that is, indeed, through this kind of thing, everyone can realize technology to make money. The business incentive effect of Meta Universe is very strong, because this thing has just begun and it is still a blue ocean. Through DAO+DeFi such an incentive mechanism, a new employment and collaboration paradigm has been created. It also provides many young people without capital with the opportunity to counterattack. Many young people make a fortune. This is currently difficult for the Internet to achieve.

Take AXS (Axie Infinity) as an example. This year, its revenue has achieved an order of magnitude leap. And in many countries, especially some countries in Southeast Asia, such as the Philippines, 30%-40% of their labor force is earning income through this game, and the proportion of income realized through this game is two to three times higher than their previous jobs on average.

Everyone has been thinking about a question before, how does the meta-universe or the encrypted world affect the real world? Unexpectedly, this year, such a big impact on the real world will be realized. 30%-40% of employment in a country is a data that was hard to imagine in the past. Moreover, this matter has actually produced a great demonstration effect on projects such as GameFi and SocialFi.

In the digital economy paradigm, labor can actually be defined into two types: the first is general labor that meets the rigid demands of social use value. For example, we do a lot of things through computing power. This computing power itself does not carry any emotional color and does not carry value judgments. It is to satisfy some of our labor tasks; the second is to meet the needs of human psychological value. Some “quasi-individualized” labor. For example, in the meta-universe, we need several cards and several characters to form or multiply some new characters. These things have a kind of quasi-individual labor. Quasi-individualized labor will have a bargaining price compared to general rigid demand labor.

Seven, the main organization form of the meta universe-DAO

The model of DAO this year is also very mature. The organization and operation of DAO are also more adaptable to the development of the meta-universe. (DAO: Decentralized AutonomousOrganization)

What is DAO? That is, you do not need to register a company to operate, but write our rights and responsibilities, division of labor, and collaboration on the code of the blockchain, and let the code run, so that we can match the labor force on a global scale. Some people have comparative advantages, some people have skills, and some people are willing to pay and provide ideas or other means of production. Everyone can combine them. Time is also more flexible and looser. The meta-universe I understand is basically developed in the form of DAO.

DAO was first practiced and explored from The DAO in 2016. The DAO has suffered a big setback, but after four or five years of development, it has shown a prosperous situation, and it has proved that this track has its own vitality. One of the more representative ones is YGG (Yield GuildGames). YGG is a meta-universe game guild, which is also very successful this year, and its community building is also developing very well. In addition, it also includes Venture DAO, which is how to invest in meta-universe projects around the world through DAO. Venture DAO is also a very clear track. It has achieved a lot of growth, and there is still a lot of room for the future.

I think we can put forward a very important proposition this year, that is, can DAO partially replace the corporate system? If it is placed in 2020 or 2019, it may be too arrogant to ask this question. But this year, I think it’s time to ask this question. Because DAO’s practice has achieved remarkable results, including the need for matching labor on a global scale, online office and distributed office under repeated global epidemics, will determine its long-term existence. So this year I think everyone can discuss this very important issue-whether DAO can partially replace the corporate system.

8. An important form of expression of the meta universe-NFT

There is also a very important concept of high overlap in the meta universe, which is NFT (Non-Fungible Token). Simply put, NFT is a non-homogeneous token, which means that each token has a unique and unique identification. The combination of NFT and Metaverse is that Metaverse itself is a digital world. There will be many transitions of real things in the digital world, and there are many unique experiences and assets of users or players, so it has a closer integration space with NFT.

The main form of expression of the meta universe is NFT. Of course, Metaverse also has many FTs (Fungible Token). FT is generally used to portray something that measures value, while NFT is mainly used to portray the experiences or assets of some players or users with such unique identifiers.

Two typical NFTs this year. One is the jpg format . jpg is the avatar we are talking about. It is probably this type of avatar, which is very popular around the world. Another way of expression is the txt format . For example, a project is called Root, and Root opens the txt type of NFT. Frenzy. It is to use some letters to form some words, or form some sentences, you use algorithms to synthesize. In fact, this is where Meta Universe and NFT are attractive or fun this year.

Many people, including OG (Original gangster veterans) in many industries, actually don’t have a very clear concept of how to develop in the future. It can only be said that as the industry fluctuates, everyone crosses the river by feeling the stones. Take, for example, NBA star Stephen Curry. He changed his Twitter profile picture to this monkey. He spent $180,000 at the time. In fact, this kind of avatar is very common, and many acting stars have changed this kind of Twitter avatar. The floor price of many heads is very high. For example, for the previous series, for a period of time, its floor price reached 100 ETH , and 100 ETH was about 3 million yuan. In fact, it was beyond the understanding of many people.

Wu Tong: The Internet is too convoluted, we need Metaverse

Wu Tong: The Internet is too convoluted, we need Metaverse

In fact, there are different cognitive differentiations on this matter in the industry. In fact, cognitive differentiation is a good thing. Because if the cognition tends to be consistent, often an industry may reach a bottleneck, but when the cognition is differentiated, this thing has relatively strong vitality.

Nine, the meta universe is still not heaven and earth

Many people say that since Metaverse has put forward such a good vision. Solve the internal volume of the Internet, return the data to the user, and then we can grasp the value of our own data. Is the meta-universe heaven and earth? Actually it is not. The meta universe is still a cruel world.

Commercial factors have always been a very important proportion in it. At the same time, its development has a lot to do with social and cultural reasons. Everyone says that since the meta universe is a digital world, do the resources in it tend to be infinite? At present, it is not, not only is it not tending to infinity, but very scarce.

At present, many meta-universe projects deliberately create a kind of scarcity in order to attract more users to participate. Will these things no longer be scarce in the future meta universe? I think this is a high probability. Because the business logic in the early stage is still a very important logic, maybe after the user reaches a certain level, the entire community will modify it through negotiation or through other mechanisms. The development of the entire industry is iterative too fast, and it is difficult to go in which direction to go in the end. Define.

After Facebook released the news of the name change, Meta universe real estate suddenly achieved a skyrocket. In the meta universe, real estate is still a basic industry. For example, “The Sandbox”, it opened a new round of land auctions this week. It sold 300 plots of land, 100 of which were prime locations, and 200 yuan is an ordinary lot. If you buy these land, these landowners can do some things they want to do on it, which is actually more like the real world. Why are everyone willing to participate in these things? It also took a fancy to its future growth, including SAND and MANA , all of which are doing meta universe real estate. The real estate of Yuan Universe is roughly equivalent to our domestic real estate market in 1998, and it is still in a state of nugget.

At the same time, the meta-universe is also a cultural phenomenon, which is a meme. Meme has actually become a relatively common phenomenon in the world since last year. There is a saying that “the essence of human beings is a repeater”, because everyone sees that many people are playing this thing, and they want to play it too. Just like currency, its network phenomenon is very obvious. People think that if I don’t play, I will be abandoned by everyone, and I will be out of gregariousness. The FOMO (Fear of Missing Out, meaning “fear of missing out”) effect is still relatively strong, and the cultural and social logic of the meta-universe is also strong. Especially the rise of the Z era now. The Z era is gradually becoming a force of production, consumption and investment that cannot be ignored by the society. They actually admire these things very much.

10. The meta universe is not an independent concept

Starting from this month, the relatively popular DeFi 2.0, including Web3.0, NFT, and DAO, have basically been established and developed in the meta-universe. Briefly talk about the logic of these concepts.

DeFi is the operating logic of the meta universe. If the meta-universe wants to operate through this digital civilization, its internal logic must be through DeFi. We write the most basic logic in the code, and then use various incentives to complete it through distributed finance.

Web3.0 is the data logic of Metaverse. It is how to realize the next generation of the Internet and how to return users’ rights (most importantly, ownership) to users themselves. NFT is a form of expression of the meta universe. DAO is a major combination form of the meta universe. Therefore, in my opinion, these concepts are relatively highly integrated concepts. The development of these concepts together supports the development of the meta universe.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/wu-tong-the-internet-is-too-convoluted-we-need-metaverse/
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