Why Experts Are Criticizing China’s Plans to Regulate Metaverse

China’s telecom operator, China Mobile, has pitched a “digital identity system” to regulate the metaverse and prevent the spread of chaos or rumors in the digital world.

While China may have banned crypto-related activities, it is in a full-fledged preparation stage for the metaverse. However, the privacy flag bearers have questioned the digital identity system.

According to Politico, China’s digital identity system for the metaverse has striking similarities with its social credit system. The digital identity system would be designed to collect the user’s personal data, like their occupations, identifiable signs, and other such data. 

Moreover, China Mobile has suggested that law enforcement permanently store this data to maintain a safe environment in the metaverse. It believes that personal data could aid police in investigating bad actors in the virtual world.

The United Nations’ information and communication agency, the International Telecommunication Union (ITU), inaugurated a special group for metaverse regulation in December 2022. Politico’s report mentions that the metaverse group will likely vote on China’s proposal this October.

However, as the proposal has similarities with the social credit system, it has received heavy criticism from the experts. Chris Kremidas-Courtney, from Friends of Europe, said:

“To build a unified digital identity system, to give each human a unique digital ID that includes social characteristics from social media and occupation – that sounds a lot like China’s social credit system.”

China’s social credit system is a regulatory framework to rate an individual’s trustworthiness. A poor score may result in various blacklists, including blocking the person from accessing public transport. 

Meanwhile, various forecasts show that China’s metaverse industry is on its road toward exponential growth. In April, BE[IN]CRYPTO reported that China’s metaverse industry is expected to grow by 40% in 2023.  

According to Statista, the metaverse industry will grow at least seven times by 2030. This year, the sector is worth $12.6 billion, forecasted to hit an $87.6 billion valuation in the next seven years.

Metaverse Policing

Not just China, but various other countries are also exploring policing the metaverse. On May 2023, Hong Kong launched the CyberDefender Metaverse to tackle metaverse crimes such as fraud, hacking, theft, and sexual offenses.

Prior to that, in October 2022, INTERPOL launched a metaverse for law enforcement worldwide. And Dubai’s Ajman Police became the first police agency to provide its services through the metaverse. 

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