Regulating the metaverse: The new unknown - Hindustan Times
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Regulating the metaverse: The new unknown

ByHindustan Times
Oct 20, 2022 02:59 PM IST

The article has been authored by Amar Patnaik, Member of Parliament, Rajya Sabha from Odisha.

For about four decades since the advent of the internet which ushered in a new epoch of the information age, regulators have found themselves behind both the regulation curve as well as the innovation curve when it comes to internet governance. With changes happening at an unprecedented frequency, this lag is only increasing. The regulatory challenge is centred around capacity, agility and quality to ensure a fair marketplace and at the same time ensuring citizens’ protection against harm while promoting innovation and protecting democracy and free speech.

Various organizations and even industries are stepping up and forward with metaverse development to offer an immersive user experience.
Various organizations and even industries are stepping up and forward with metaverse development to offer an immersive user experience.

The internet ecosystem has been maturing with the discourse firmly set on the issues and principles around user rights, service providers and intermediaries’ accountability towards users and to the State in matters of national security and law and order. Metaverse, a digital platform enabled by Web 3.0 and designed to offer an immersive social experience within the confines of the internet through augmented reality, is expected to be the next platform of the internet.

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Metaverse presents a completely separate universe. One can be represented by one’s digital avatar, and undertake a host of activities like recreate any environment like a home or an office space, own a piece of virtual land and transact using cryptocurrency - essentially indulge in most of the activities that one dabbles in an offline world. Just last month, HSBC purchased virtual land in The Sandbox dedicated to engaging with e-sports enthusiasts. A neobank Zelf is launching embedded banking for metaverse gamers. The use cases and creative ways of engagement within metaverse are going to expand with almost every passing day. While metaverse will transform the way we consume the Web, it will also throw up challenges that will need the attention of the regulators and policymakers.

Ensuring privacy on the metaverse would firstly need privacy and data protection designed in its ecosystem (privacy by design) and second and most important, for the country to have a privacy and robust data protection law that lays down a solid foundation towards safeguarding the data of digital consumers so that no harm comes on them.

After withdrawal of the much debated and deliberated Data Protection Bill of 2019 which would have exercised jurisdiction on the metaverse, policymakers and the regulators will need to be nimble and creative to ensure that a new law as promised is enacted as soon as possible and that it takes into account the peculiar nature of metaverse that has ways of escaping the data protection law. Due to the use of massive amount of data that the metaverse will operate on, safeguard and protection of such user data is of paramount importance. IT companies may utilise this data to simplify and personalise their goods and services to meet the needs of their users. But there would also be concerns of higher surveillance over a person’s activities so as to influence his behaviour and choices and also, selling this data to advertisers. As more personal data is uploaded on the metaverse, the risk of sensitive or confidential information being stolen also escalates. There is therefore, a crucial need for regulators to be creative. The best bet is to come up with accountability mechanisms based on harm caused to users.

In the metaverse world, there are also concerns about bullying, sexual harassment, discrimination, racial abuse and a host of other real-world problems. There have already been reported instances of employees facing racial abuse and women getting groped in virtual reality. Without robust mechanisms to report, prevent, and act in real-time, this could lead to unwanted conduct. While it would be easier said than done to attempt and use real world laws and apply them to the metaverse, the nature of the platform, be it centralised or decentralised, will make it extremely tricky to offer remedial as well as punitive measures to such grievances on the grounds of lack of audit trail, incontrovertible evidence, acceptable jurisdictions and efficacy of criminal jurisprudence applicable to a digital metaverse world. It is important to deliberate on liability mapping to address the accountability issues.

The impending privacy and digital laws must take cognisance of these and ensure that the content moderation policies of the metaverse platforms are made to incorporate provisions which would minimise such instances and also ensure that remedial measures are offered.

Another aspect of the metaverse is that it would be aided and fuelled by Internet of Things (IoT) gadgets like augmented and virtual reality sets which can monitor and process biometrics data, like eye-tracking, gait-tracking, brain wave monitoring, iris and retina scan among other things. There will be concerns as to the extent to which this data would be extracted. IoT has a very complex data processing mechanism with different architectures. While the Joint Parliamentary Committee in its proposed Data Protection Bill 2021, did suggest that a Data Protection Authority (DPA) should create frameworks for monitoring, certifying, and testing manufactured hardware devices (including IoTs), it is a subject that needs to be probed further to ensure a fair and reasonable structure in terms of compliance and accountability keeping in view the harm likely to occur. Issues around reasonable processing of data as determined by the DPA, privacy by design principles and reporting of data breaches need to be fleshed out in detail considering the IoT ecosystem and functioning.

The growth and expansion of the metaverse is now a foregone conclusion. It will augur well for our regulators and policymakers to be fast, agile and decisive to formulate a principle-based approach towards this emerging tech environment.

The article has been authored by Amar Patnaik, Member of Parliament, Rajya Sabha from Odisha.

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