China Discusses Metaverse for the First Time at the National Level
The subject of Metaverse was discussed for the first time in China at the national level during the latest “Two Sessions”, an event that is held once every year in the country. The interests of the majority of the delegates at the event revolved around regulation to ensure data security and the eradication of speculation within the industry.
Metaverse has become a hot topic in China, especially among the big tech companies. This new trend emerged in the second half of 2021 after China embarked on a serious crackdown on cryptocurrencies. A crackdown has seen the overall cryptocurrency activities in the country drop significantly. Even the volume of trading which claimed about 90% of the global ratio before the crackdown has dropped to as low as 10%.
Among the companies that have led the trend in Metaverse adoption in China are Baidu, Tencent, and NetEase. Even Alibaba has gone a step further by releasing NFTs based on the Metaverse idea. The NFTs released are referred to as digital collectibles.
During the Two Sessions event, there was a universal agreement among the delegates that the Metaverse industry has growth potential. They also agreed that this is possible with proper regulations.
A deputy to the National People’s Congress, Kong Falong that a national institute for metaverse should be established. According to him, such an institute would be beneficial and will spur the growth of the industry. According to Falong, with increased investment into the industry to nurture talent, and support development, China could become a leader in the metaverse space.
Falong also acknowledged that a side-effect to such a development could arrive with increased investment and growth. The issues he pointed out include information protection, data security, and speculation. Hence, the essentiality of the regulation of firms operating within the metaverse space.
From his observation, Zhang Ying, a member of the Chinese People’s Political Consultative Conference (CPPCC) noted that the current metaverse space in China is largely focused on entertainment experience, in addition to speculation. As a result, he suggested that government regulation of the industry is necessary. This, he claims, will ensure the growth of the industry in terms of technological development.
China’s stance on the regulation of cryptocurrency and other related industries is not new. Since 2013, there have been several steps to eradicate crypto activities in the jurisdiction. This was not pursued forcefully until 2021 when a holistic approach and enforcement led to an exodus of crypto practitioners from the country.
Considering the outcome of the Two Sessions, expectations that regulation of the metaverse industry will be implemented from an early stage. When this happens, it will create a framework from the beginning for those willing to enter the ecosystem. In the long run, the development of the industry is expected to be different from what was obtained with cryptocurrencies where the sudden change led to what could be regarded as an extinction.
What most people expect from the government is the kind of regulation that will foster adoption, rather than stifle innovation. If that becomes the case, Falong’s prediction that China will lead the world in metaverse development could become a possibility. At the moment, this looks achievable with the tons of applications for patents that have already been submitted in the space.