Why The Metaverse Is Already Broken (And How To Fix It — Chapter Two) by@metapunk

Why The Metaverse Is Already Broken (And How To Fix It — Chapter Two)

The Metaverse and web3 is a start from the scratch moment for us all. Unity or Unreal are the first two platforms for building the metaverse, but are you even aware of alternatives? At a push, you might even consider throwing in CryEngine or Unigene if you know the space well enough. At this point, Matthew Ball completely loses focus because he can’t see past platforms and where we are today. Even Berners-Lee has picked up a white flag and given up with a half-hearted attempt at user sovereignty built for a world that’s already broken.
metapunk HackerNoon profile picture


Affectionately known as the Tony Stark of Web3 by his three cats.

You made it, welcome back!

Clearly dropping a cliffhanger works so now I’ll take a leaf out of the old, classic serials and do a quick recap but then alter a tiny detail that gives our hero a get-out clause to survive last week's seemingly impossible and precarious predicament and sets up the next episode.

In Part One I discussed at some length one of the core tenets of Web3 and the Metaverse according to a number of manifestos or set of rules that is ‘decentralization’. According to a16z, “Decentralization is the overarching, governing principle of a proper metaverse, and many of the traits that follow depend on or result from this main concept.”

By decentralization, we mean not owned or operated by a single entity or at the mercy of a few powerbrokers.

Well, we seem to be on the right track on paper, and coming from one of the largest venture capital firms in the world we’re watching with bated breath at all the big deals we’ll see injecting funds into the open source community.


Right lads? Never mind.

Tony Parisi, Chief Strategy Officer at Lamina1 chimes in that open, interoperable technology will provide the most assured way for the Metaverse to scale.

An open ecosystem of software and hardware offers greater choice to creators and consumers. Greater choice means more and more varied content, more success for creators, and more opportunity for tool and platform providers, enabling a virtuous cycle.

He adds later that “it may finally be time to go back to the drawing board when it comes to concepts around browsers, user agents, object models, protocols, persistent state and so on.” — finally we get to the real argument worth discussing here and a point I made in the previous post; that the metaverse and web3 is a start from the scratch moment for us all.

Yes, it really is time to throw the baby out with the dirty bath water.

At this point, Matthew Ball completely loses focus because he can’t see past platforms and where we are today. In fact, the constant quoting and referencing of Tim Sweeney and where Epic Games has come from is going to start to feel like the entire series of articles was sponsored.

Gretzky said he skates to where the puck is going to be, not to where it's been and unfortunately the opposite is true in many cases where we are thinking about the metaverse. People are building for what they know today will work, there are no real visionaries here building for what will work tomorrow. It takes a fucking lot of guts to move in a completely different direction.

Like I said in Chapter One, even Berners-Lee has picked up a white flag and given up with a half-hearted attempt at user sovereignty built for a world that’s already broken, not one that doesn’t exist yet.

Born Free — Open, Interoperable, For Everyone

Ask the majority of people about available tools for building the metaverse and they’ll state Unity or Unreal as probably the first two platforms that spring to mind. But are you even aware of alternatives? At a push, you might even consider throwing in CryEngine or even Unigene if you know the space well enough.

So much reporting is done on the prior two major platforms that nobody cares to research whether anything else is worth examining. Not even Ball.

Did you know, off the top of some basic research there are another ten game engines that could potentially become the protocols and platforms for an open metaverse?

Godot, Cocos2d-x, Armory, Openage, Sprint Engine, Panda 3D, Defold, Phaser, Moonstream, and O3DE.

Any one of these could be taken by the community and developed further, their code is open source. What’s even more interesting is that O3DE is the failed commercial experiment of Amazon taking a fork of CryEngine and trying to take on Unreal for games development. But like the Amazon Fire phone, Bezos tried to muscle his way into a domain he knew nothing about and it crashed and burned spectacularly.

Then there’s the open source graphics software packages, sound software, and physics engines….in fact for pretty much every commercial and centralized tool that can be and is currently used to build the web3 and metaverse utopia we’ve been promised there is a free and open alternative.

So why aren’t they being used? Convenience and apathy. We have become an apathetic society, indolent and spoon-fed. This is why the real creator economy, the one where people have dug into how and why an NFT works and then launched something off their own efforts is far more exciting than the highly commercialized and VC-funded enterprises — we’re almost back to flashes of bedroom coding again, where the likes of 11-year-old Benyamin, the creator of Weird Whales learned how to launch his own collection and is now guest speaking at institutions like Oxford about his exploits.

It’s worth reading this lengthy article from Matthew Ball about Epic Game’s long-term strategy over the years and where it’s leading.

I wrote last year (republished recently on LinkedIn) about how Sweeney’s vision has been akin to a Blue Ocean Strategy all along, that the prize for the metaverse was the ultimate goal for the use of Unreal Engine.

“At Epic we succeed when developers succeed.”

It’s true that Epic’s strategy has been to remove as many barriers for developers to gain access to their tools as possible at the expense of revenue — the majority of games will never hit over $1m in revenue so Epic will get no license fee revenue themselves.

But with the metaverse being the goal there’s absolutely no way that, if web3 achieves the promise of democratization for content creators, we should believe people using Unreal to build their virtual worlds and content won’t be making these numbers.

It’s a $5 trillion industry after all if the numbers are to be believed.

“This Metaverse is going to be far more pervasive and powerful than anything else. If one central company gains control of this, they will become more powerful than any government and be a god on Earth.”

Tim has been very vocal about centralized platforms and walled gardens like Facebook, Apple, and Microsoft taking control, and rightly so. But what about centralized ecosystems?

Just look at the diagram here — there is nothing decentralized or open about Epic in the slightest. Dig further and just pay attention to the acquisitions over the years to see how much real estate Epic owns. The most recent was Sketchfab.

Sketchfab is a 3D modeling platform website to publish, share, discover, buy and sell 3D, VR, and AR content. It provides a viewer based on the WebGL and WebXR technologies that allow users to display 3D models on the web, to be viewed on any mobile browser, desktop browser, or Virtual Reality headset.


Matthew’s article goes into a lot of detail about Epic’s financial strategy, and seemingly altruistic approaches toward the developer community.

It’s certainly helped the cause by taking on Apple’s app store policies, and also Unity being a complete clusterfuck of a company itself (I’ve had so many conversations with devs who are ditching for Unreal after their latest merger).

“Whatever form this medium ultimately takes, our biggest hope is that we can play a role in it, whether we’re the creators of the big thing or technology supplier to it, or even better, if it’s a decentralized distributed system that combines everybody’s efforts and connects them in a much more open way.”

Tim never talks about making money because that’s not his interest or motive. Some people want to make billions, some just want to watch the world burn.

Tim is motivated by power — the power to be the one that owns the development infrastructure to build the metaverse. If Tim says Epic will support NFTs the market breathes a sigh of relief because if Epic said ‘no’ where are you going to go? Unity? LMAO

I firmly believe Epic will crack interoperability before everyone else (explained later), or certainly provide a mechanism for it that will tie it back to Unreal and offer it for free-ish. Eventually, he will make the money, not now but in 10–15 years when everyone using Unreal starts raking in — $1m in metaverse terms is tiny.

If they were really supportive of the development community they’d tell them about all the open source alternatives that exist across the industry. In fact, if VC firms like Andreessen Horowitz were serious about the ideology behind web3, democratization, and decentralization they’d be pumping money into the open source community. But they aren’t.

That should make you sit up and think.

Unreal is seen as the welcome antidote in the industry but it’s actually the drug. And you’ll all be hooked. That’s the real Blue Ocean strategy at work here.

But it’s ok. Because we’re starting from scratch remember? Frankly just let Tim and Unreal own the old world because that’s not where Web3 and the metaverse are both truly going to be birthed.

The other issue here is open standards which are fast becoming another set of walled gardens.

Hanging In The Walled Gardens of Babylon

History is already starting to repeat and I feel like we never learn a thing. Another metaverse standards consortium has popped up on top of the existing Metaverse Standards Forum.

This one is called OMA3 (OMA 3 — Open Metaverse Alliance for Web3) and is led by some of the more prolific brands across web3 like Animoca, Decentraland, Sandbox, and others.

The MSF has around 650 members so far and its mission states that

“the potential of the metaverse will be best realized if it is built on a foundation of open standards”

It provides a venue for cooperation between standards organizations and companies to foster the development of interoperability standards for an open and inclusive metaverse and accelerate their development and deployment through pragmatic, action-based projects.

Sounds decent enough.

Now here comes OMA3 where the mission is to realize a goal of an open metaverse by operating as a DAO (decentralized autonomous organization) and

“is guided by the principles of inclusiveness, transparency, and decentralization.

The standards we create are guided by the goals of true ownership and real-time interoperability.”

Ok, so pretty much the same goals then.

Back in 2015, I was tracking some 10 major factions fighting to become the standard for IoT, the reality being that 6 vendors controlled the outcome of the industry. There was a lot of money sloshing around if you believed the pundits — $19 trillion to be precise.

The metaverse so far represents $3tn which is no wonder why we’re going to see another bunch of fragmented standards councils all wanting to own their piece of land.

Now I can see Tim Sweeney’s point about being in for a decade of pain and suffering around standards and interoperability with so many groups now starting to form.

“We will build infrastructure to ensure the metaverse operates as a unified system where digital assets (such as NFTs), identities, and data are permissionless and interoperable for all and controlled by users, not platforms. Users will immutably own these assets and transfer them to any OMA3™ virtual worlds freely, without needing the platform’s permission.”

This sounds like a lot like a closed system to me, as long as you’re part of the group of companies building on their infrastructure.

For an industry that preaches about collaboration and community, there are an awful lot of walls being put up around paradise already.

Here is where a16z starts to make sense in their manifesto.

“The power of composability in web3 is largely due to its open source ethos.”

They go on to state that “true composability is impossible in the absence of open source, which is the practice of making code freely available and able to be redistributed and modified at will. Regardless of degree or kind, open source as a principle is so essential to the development of a metaverse, that we’ve broken it out as its own separate ingredient despite the overlap with composability above.”

This should be making everyone sit up and take notes again. Ball makes an excellent point himself in Part VI of his essays, that

“the use of common standards also meant that it was easier and cheaper to hire, to work with outside vendors, integrate into third-party software or apps, or repurpose code. The fact that so many of these standards were free and open source also meant that individual innovations often benefited the entire ecosystem…”

Here I believe we differ on the definitions of the ideals because in order to achieve an open and interoperable metaverse we’re going to have to strip it back to where it all began with Web1 — back in the hands of the people.

I made my case in Chapter One about the true nature of decentralization and I’ll stand by it as a foundation of the technical infrastructure or set of protocols needed to support the building that’s to come.

What we need thereafter are more composable protocols and open standards to allow that to flourish — protocols, not platforms. This flies in the face of the current trajectory of industries in general, that we have platforms built upon platforms but all of them centralized power structures.

It may finally be time to go back to the drawing board when it comes to concepts around browsers, user agents, object models, protocols, persistent state and so on.

Remember this quote from Tony? It’s true and oddly aligned with how a16z sees the world of Web3, if only they would put their money where their mouth is for once.

Everyone is fixated on the predication that the metaverse will one day be controlled by a single entity and are so violently opposed to it to the exclusion of seeing the real truth — that is, ignoring the fucking obvious that single entities can also mean ecosystems and platforms that are used to build it in the first place.

“Web3 technology is already becoming an early foundation of the Metaverse and will play a critical role going forward. In particular, identity, privacy, payments, and economies in the Metaverse will be shaped by these initiatives.”

Well, quite Tony but even Lamina1 is making a mistake right at the outset by building a fork on Avalanche (according to the recent AMA) which means they’re building an annex on someone else's plot of land.

This is no different from the myriad of forked Axie Infinity clones we saw spawned at the height of late 2021 only to watch the entire play-to-earn market reduced to ashes. Like a stack of dominoes, when one falls so do they all because they all inherit the same design flaws.

“Some industry players may establish early advantage by exploiting economies of scale and offer loss-leader products, but any advantage will be temporary.”

Oh, my friend, if you could only see the irony dripping from that statement.

So, we have sets of competing ‘open standards’ being created by commercially driven and centralized agencies, centralized closed ecosystems in favor of open source software, and we’ve still to tackle interoperability.

Fuck me I feel very claustrophobic right now.

Interoperability — but only if you make the ultimate sacrifice

I mentioned Sketchfab earlier for a reason. You can sign up and join Sketchfab for free. With a Basic membership, you can upload an unlimited number of public downloadable models. 10 view-only models per month, up to 100 MB each.

All Sketchfab Content is owned by Sketchfab, Inc. or its licensors, and is protected by the U.S. and international copyright laws, trademark laws, and/or other proprietary rights and laws but copyright free because the 3D model downloads on Sketchfab are shared under Creative Commons attribution licenses, giving credit is a necessity.

Why is this an important point

Because in all honesty, I think this is how Epic Games is going to crack interoperability if you use their ecosystem. Sketchfab is a fucking gigantic library of objects that are centrally held, but community driven. If I decide to make a game or metaverse using one or more of these objects, and they’re all available for everyone to use, then it means that you can make a game using the same models.

Did the penny drop yet?

If I use Cup Model A in my game, and under the wonderful ideology of asset interoperability and ownership, Player Z buys this item and wants to use it in your game, where you used the exact same model, then the chances are moving this object from one game to another is going to be possible. You are using a 1:1 relationship where the object is already supported and, assuming no other attributes were changed in the underlying model, it will look and behave in a manner that supports the model.

In fact,

Fucking Grade-A Genius Acquisition.

There are 6m users of Sketchfab, Jesus fucking Horatio Christ people see what’s happening here.

Ok, so it means that there could be a lot of homogeneity across virtual worlds and metaverse projects but the idea and fundamentals of interoperability are starting to become clear. It has fuck-all to do with blockchains and NFTs and everything to do with creating a centralized database, filled with community creations, to draw from.

Raph Koster, CEO of Playable Worlds and creative force behind titles like Star Wars: Galaxies and Ultima Online wrote a brilliant set of blogs explaining the problem and drills this point home perfectly.


Raph Koster/ Playable Worlds

A digital item is made up of database entries. It’s bits and bytes living on a server. It may have been made by the same folks who operate the server, or it may not have. It may have been uploaded by someone who pays for the privilege of manipulating the data on the server, or it may have been uploaded by someone who gets access for free.

In some cases, these bits and bytes might be a unique arrangement of data, in which case it is probably copyrighted by someone. In some cases, it may actually be a record of activity instead, in which case and under some laws, it might be subject to privacy laws instead.

In no [legal] sense are any of these database entries “objects.”

You all were so desperate for interoperability that it was built right under your noses and is potentially now controlled, again, by Epic Games. You might think at this point I have some huge beef with Tim and Epic, I really don’t, I just see perspectives from a different angle and all the conference rhetoric and inspirational quotes can’t shake this gut feeling.

Something like this also makes a mockery of community ownership, one of a16z’s other core tenets of web3 but we’ll tackle this in another chapter.

It should be becoming a little clearer now that decentralization is not only a core tenet for building the metaverse of web3, it is in fact the only fucking core rule. Period.

This is the problem even in blockchains that are ignored. The now famous blockchain trilemma is a concept coined by Vitalik Buterin that proposes a set of three main issues — decentralization, security, and scalability — that developers encounter when building blockchains, forcing them to ultimately sacrifice one “aspect” as a trade-off to accommodate the other two.

It is a widely held belief that decentralized networks can only provide two of three benefits at any given time concerning decentralization, security, and scalability.

The beef I have with this is that decentralization is not a part of the solution — it’s inherent to what blockchain is supposed to achieve and therefore should be removed from the equation.

It is, in fact, the apparent goal of web3 and the metaverse in the first place.

So you’re either left with trying to balance two parts — scalability and security, and the pivot point which never moves (because it’s implied) is decentralization. A bit like a seesaw.


The goal remains decentralization and central to everything and the trilemma still exists but you’re being pulled in three directions by scalability, security, and one other. Or maybe there’s some other bloody shape instead of a triangle. Who knows. The issue is that decentralization sits at the heart of it all.

You can’t create a community without it, you can’t create protocols without it, nor the creator economy or currencies needed to scale it, nor the technical infrastructure to power it all.

I’m arguing with myself here as I write this because out of the three manifestos a16z seems to nail so much of this and it pains me to agree.

Composability is a systems design principle, and here specifically it’s the ability to mix and match software components like lego bricks. Every software component only needs to be written once, and can thereafter simply be reused. It’s analogous to compound interest in finance or Moore’s law in computing — some of the most powerful known economic forces — because of the exponential power it can unlock.

To feature composability — a concept closely intertwined with interoperability — a metaverse would have to offer high quality, and open, technical standards as a foundation.

In their strongest form, composability and interoperability are possible permissionless across wide ranges of the software stack.

Liz Harkavy, Eddy Lazzarin, and Arianna Simpson co-wrote these sets of rules and I agree. I’m agreeing with capitalists about the foundation of Web3 and it hurts my brain — I don’t agree with how they’re going about enabling it, of course, I agree with how they’re describing it should exist. Again, put your money where your mouth is kids.

I’ll argue against the permissionless bit for another time too because this stinks of the absolving of responsibility when things go South. They might mean this from a technical standpoint but so much of how this is going to work is a human effort and we all know what happens when we introduce people to a free and open system…


Time for a nap…

In the next episode, I’m going to continue with some more core themes, I’ll recap on composability (it deserves a bit more because it ties deeply to the origins of the web itself and protocols of web3), community, identity, and more.

I might even throw in the metaverse and web3 search into this because it combines a lot of where we’ve been so far and the search is becoming very interesting to a lot of people.

The kids are apparently turning to TikTok for search and of course, all the marketers are clambering over the dead bodies of failed campaigns and SEO initiatives to understand why and play in this brave new world — it’s bullshit but it helps point to how the search will work for web3 and the metaverse.

And again, it can only truly happen in a completely decentralized world.

I’m going to leave the hardware and more technical aspects for a later Chapter, along with that 8th rule Matthew threw in for kicks about user behavior (this is actually a very important rule!)

Stay tuned for Chapter Three: Composability, Community and Content.

Also published here.

react to story with heart
react to story with light
react to story with boat
react to story with money
. . . comments & more!