CoinDesk’s scoop that Barbados had become the first government to acquire virtual land and create a “metaverse embassy” was met with great interest
CoinDesk’s scoop that Barbados had become the first government to acquire virtual land and create a “metaverse embassy” was met with great interest, but a lot of quizzical looks as well.
The question some commentators asked was: What is the point? If Barbados is trying to digitally solve some problem – such as how to make issuing visas and permits more efficient – why use a blockchain when a simple e-government services website would suffice? The metaverse part seemed like a gimmick.
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Our own Will Gottsegen, who knows the nooks and crannies of non-fungible tokens and the metaverse far more deeply than I do, concluded a skeptical column on the topic by stating, “Not everything needs to be on the blockchain – in the absence of clarity, the metaverse embassy just feels like an empty ad campaign from a government official with a stake in the crypto industry.” He was referring to Gabriel Abed, Barbados’ ambassador to the United Arab Emirates, who is also the founder of crypto company Bitt and the person who brokered the deal between the government and blockchain-based virtual world platform Decentraland.
To Will’s point on clarity, we definitely need more information on what Barbados plans to do with this project. Still, I think there’s a lot more here than meets the eye. This raises some pretty interesting questions about how sovereignty is exercised in the digital age. And it has the potential to be quite disruptive.
To understand why, we need to go down the rabbit hole of property rights and state power, starting with how it currently works in real life.
Treaties and property rights
When governments set up embassies in foreign lands, international treaties ensure they’re granted certain protections from interference by the host country’s government.
Those treaties hinge upon the control that national governments legitimately exercise over access to their territory, a power that stems from their command of the security forces that police it. The host commits to not arbitrarily exercise that power.
Meanwhile, legally enshrined property rights give foreign governments the freedom to use that space without interference from the state, much like those enjoyed by private homeowners in modern democracies. This combination of treaty protections and the right to own, occupy and use property creates a sufficient degree of sovereignty for an embassy to function.
Read more: A Crypto Guide to the Metaverse – CoinDesk
It’s important to note that both of these rights exist at the whim of the host government. There are plenty of examples of one state deciding not to grant another diplomatic recognition – the U.S. did so with Cuba for decades – because of one geopolitical issue or another that, in its view, outweighed the benefits of reciprocal rights.
The point is that the entire system of international diplomacy starts with the premise that national governments control their territory and hold jurisdiction over the laws governing how individuals and entities can and cannot behave within it. That power affords governments the discretion to decide with which people and entities they and their citizens can transact, interact and forge diplomatic relations.
Now, let’s translate that to NFTs
How I relate this legal framework to the metaverse stems from my view that non-fungible tokens are the foundational layer for a new model of digital property rights. I believe the systems we build on them will eventually end the power of gatekeeping internet platforms such as Facebook and Google to set the terms for digital asset usage rights.
It’s also based on the idea that an entity’s control over the private key that manages tokens or smart contracts within a blockchain address is analogous to a nation-state controlling access to its land. Whenever an NFT is transferred from a seller to a buyer, the former enables access to it by putting the token and any on-chain related digital assets under the control of the latter’s private key. (Note: Rights to off-chain assets such as digital or physical art also require a real-world legal contract that’s associated with that NFT, which is analogous to a property deed spelling out an owner’s or occupier’s rights to a piece of real estate.)
Apply this idea to a government using its private key to control access to digital assets in the metaverse, and you now have something that resembles its real-world power over physical land. It’s not the same as a state’s absolute power to wield physical force against an enemy state, but it’s not far from the delegated, dependent powers that a foreign embassy acquires via diplomatic property rights and treaties.
The bottom line is that this functionality will allow Barbados to set…
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