The Shanghai Municipal People's Government has announced a ten billion yuan (US$1.4bln) metaverse fund as part of a wider roadmap to rejuvenate the flailing economy of China's most populous city.
A policy paper published on July 8 outlined plans to become the global leader in metaverse technology, with a view to grow a US$52bln industry by 2025.
Web3 proponents, whose entire philosophy is built on a pillar of decentralisation, will likely be cynical of the government-led initiative.
The announcement also comes as a surprise, given the People's Bank of China’s large-scale cryptocurrency ban enacted in June 2021.
But while a deeply crypto-sceptic country like China might seem like an unlikely global leader in metaverse technology, the move could make sense for a darker reason.
China’s nanny state
No other country compares to China when it comes to surveillance.
A year-long investigation conducted by the New York Times uncovered mass phone tracking, expansive DNA databases, ubiquitous facial recognition technology and, well, it goes on.
China’s aim is to design “a system to maximise what the state can find out about a person’s identity, activities and social connections, which could ultimately help the government maintain its authoritarian rule,” the investigation concluded.
In one mind-blowing statistic, analysts estimate that roughly 50% of the one billion surveillance cameras globally are in China; one camera for every 2.8 citizens.
Then we have China’s social credit system, which applies a trustworthiness and behaviour rating based on citizens’ day-to-day actions.
Caught jaywalking? You could be fired or even blacklisted from future job opportunities.
If you think that sounds familiar, it should- comparisons to Black Mirror episode Nosedive have been widely made.
The coronavirus outbreak also signalled an explosion in China’s digital surveillance program.
“Nanny apps” such as WeChat — China’s instant messaging and mobile payment alternative to the banned WhatsApp — work in tandem with the police to monitor digital behaviour and have been accused of contributing to the suppression of the Uighur Muslim population.
Surveillance goes meta
Could the metaverse be the new frontier for China’s surveillance state?
The metaverse operates at the cross section of digital and physical, or what the policy paper calls “virtual-real interaction”.
At times, the paper veers into the realm of science fiction, discussing “spatial computing, holographic light field, five senses enhancement, brain-computer interface and other directions to break through the bottleneck of human-computer interaction”.
Ambitious words typically read in a pie-in-the-sky startup’s whitepaper, not official government policy.
While much of the policy paper espouses the metaverse’s potential in the education, healthcare, entertainment, tourism and even manufacturing sectors, Shanghai also sees space for government representation in these virtual spaces.
“Urban digital twins” could “improve the scientific nature of urban governance” and allow for “dynamic simulation and real-time continuous monitoring of urban risks”.
What that actually means is anyone’s guess, and such grandiose terminology could, and probably should, be looked at through a fanciful lens, given that no real framework for implementing this metaverse vision exists (publicly anyway).
But while the ambitions detailed in the roadmap are largest economic in nature, phrases like “near-eye display technologies such as optical waveguides and optical fiber scanning” have an undeniable similarity to the “regionwide iris databases” uncovered by the New York Times investigation.
Shanghai intends to cultivate at least 10 “innovative leading enterprises” and 100 “specialised, special and new” enterprises.
Who exactly these enterprises will be is unclear.
3D scanning technology is a growing sector in the West, with companies such as Wolf Digital World pitching their photogrammetric technology as “the bridge between the real world and the Metaverse”, though scalability remains a bottleneck for such technologies.
Whether purely an economic stimulus or something else, the “Shanghai Action Plan for Cultivating "Metaverse”" could very well put China front and centre of the Web3 movement in the years to come.