The Metaverse And The Practice Of Law

While early, there is tremendous promise and opportunity for legal professionals as new types of issues surface in the virtual world.

African american man standing at night with VR headset on. Virtual reality concept.

(Image by Getty)

Facebook recently made the big move to change its name to Meta as it pursues a broader market beyond social media and advertising. The name is drawn from “the Metaverse,” a digital reality cyberspace world where people and computers interact with each other. As humans live in the “real world,” people can enter this digital world to interact with others, and elements of this digital world can interact with people in the real world.

For many, this notion of a virtual world is pretty farfetched, and perhaps a passing fad; but in truth, we’ve learned to interact with computers and people digitally for years. Clicking on a mouse. Using AOL chat rooms. Dating through the Internet. Using the rear-view camera on your car. These are all experiences that have been prepping demand for an increasingly digital experience through the Metaverse.

While they fall into the genre of science fiction, popular movies like Disney’s “Tron” (1982 and 2010), the “Matrix” series, and Netflix’s “Free Guy” have made the understanding of deeper real world/virtual world interaction a part of pop culture. There is an entire generation that has grown up with games like “The Sims” and “Pokémon Go.” I remember watching my kids playing the “John Madden NFL” game nearly 20 years ago and being entertained by the life-like play on the screen — it was as enjoyable to watch as a real football game on TV. Today, the top gamer on Twitch, who goes by the name Ninja, allegedly makes $95,000 a month playing games like “Fortnite,” while his more than 28 million followers follow along as spectators and occasional competitors online.

Mark Zuckerberg’s announcement to build Meta — the seventh-largest market cap company in the world — is yet another indicator of the increasing influence that the virtual world is having on our society. From online gaming to digital currencies and everything in between, the rising prevalence of the Metaverse represents new frontiers for how individuals, organizations, and businesses can interact with each other — and that also means new issues and challenges for legal professionals to tackle.

While early, there is tremendous promise and opportunity for legal professionals as new types of issues surface in the virtual world.

Meta itself poses some interesting topics of discussion. For example, Zuckerberg is promising that individuals will have property rights that are transferable across platforms. Compare that to some online services where you lose all of your data (e.g., e-mails, gaming tokens) if you cancel service. This could potentially pose some challenges for some of its competitors.

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Outside of Zuckerberg’s platform, here are some other questions for legal professionals to consider as the Metaverse at large continues to grow.

  • Will property rights be regulated in the Metaverse? What might be the role of contract law?
  • How will contracts be designed and executed? Will certain legal services be automated?
  • Is it possible for property to be stolen (i.e., hacked) in the Metaverse? What kind of liability might exist? What might tort law look like in this context?
  • Could disputes that are contained to the Metaverse and involve parties around the globe be resolved using alternative dispute resolution? Might that rise to a separate “Metaverse” legal system?

As the Metaverse expands, these are questions that leading-edge firms may need to consider. It is also likely that governments will begin to try to regulate interactions between the real world and the virtual world.

These developments could present a new frontier for smart contracts, too. Smart contracts use blockchain technology to implement the terms of an agreement, such as execution of payment terms for the purchase of property, liens on an asset, or a return policy. Smart contracts would seem to be a natural, automated solution for buying, selling, and fulfilling products in the Metaverse — and while the legal status of smart contracts is far from established, the growth of the Metaverse could present opportunities for wider use of them.

While early, there is tremendous promise and opportunity for legal professionals as new types of issues surface in the virtual world — and those issues are likely to put pressure on legal professionals across several different practice areas. We may still be a generation away from the Metaverse being large enough to be mainstream, but a stronger vision of the future can serve as a north star for innovation and opportunity.

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Next month, I’ll focus on how innovation in the Metaverse might accelerate innovation in the practice of law in the real world.


Ken Crutchfield HeadshotKen Crutchfield is Vice President and General Manager of Legal Markets at Wolters Kluwer Legal & Regulatory U.S., a leading provider of information, business intelligence, regulatory and legal workflow solutions. Ken has more than three decades of experience as a leader in information and software solutions across industries. He can be reached at ken.crutchfield@wolterskluwer.com.

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