Metaverse and NFTs, or the mutation of e-commerce

In the beginning there was nothing… or very little. Based on barter, the man never stopped innovating in his own way to act, almost as if it were his second nature. Agriculture and livestock, maritime explorations in search of new products, development of transport on land and the sea as in the sky. Trade gradually crossed borders, cities, villages, roads and dangers to be carried out directly at home encamped before one computer, tablet or smartphone. Who has never shopped online these days? Since already several years, the stars have aligned in favor of marketplaces, these giants of digital commerce through which almost everyone buys…

The law has widely worked to make room for digital trade to the benefit of consumers, but also to ensure competition and market stability. The legislator has also warned against forms of disloyalty, compliance problems and regulated delivery and cancellation periods. The Ministry of Economy was quick to condemn the excesses drop shippinga newer and yet legal practice of digital commerce.

Despite this rapid and everyday adaptation, it seems that digital commerce is evolving in a significant and different way. Initially focused on the consumption of tangible products or services, digital commerce is gradually shifting towards the sale of virtual products and services … via other worlds.

The Metaverse: Towards a Transformation of Digital Commerce

What if Steven Spielberg’s movie Ready player 1, released in 2018, turned out to be a prophetic picture of tomorrow’s market? Virtual worlds connected to the internet where everything is bought via currencies and virtual titles? Where everyone would have the opportunity to live their dream life through their avatar? If reality does not yet exceed fiction, some companies have understood the potential that the metaverse could generate in e-commerce and data collection. It is no coincidence that in 2021 the Facebook company changed its name to Meta in light of its futuristic program. If the concept seems to come out of a science fiction novel, the number of people connected in these virtual universes is constantly increasing and new practices are emerging. From buying apartments, clothes and virtual artworks…

that metaverse is above all based on an immersive experience made possible by 3D technologies that throw the consumer into a virtual world. As surprising as it may seem, the user’s avatar can purchase products that are designed virtually and do not necessarily exist in reality. Recently, Nike has invested heavily in the virtual fashion market by selling its range of shoes: CryptoKicks, whose prices can top out at more than 10,000 dollars… Others have the ambition to turn the metaverse into a vector for acquiring virtual real estate through sales, development, rental management, following the same model as standard estate agents.

Virtual reality headsets, tablets, controllers, there are many products sold physically that aim to optimize the experience of the metaverse. A high-definition experience that gives users a higher degree of confidence in the quality of the products they buy. With stores and virtual inventory, the digital trade of metaverse will no longer be subject to the limitations of opening hours, compliance with delivery deadlines, compliance issues, recruitment of salespeople, etc. If the system seems too good to be true, it is in any case virtual and all the more advantageous, as it allows testing the popularity of a product without manufacturing it, while giving the consumer an optimal experience.

The first experience of NFTs

The strong enthusiasm experienced by metaverse today is mainly due to the success of NFTs, which laid the foundation for the new electronic commerce. Beginning in the art market sector with the dazzling success of the “Bored Ape Yacht Club”, whose pictures sell at exorbitant prices, the NFTs have gradually opened up to other sectors. The cinema took advantage of this momentum to invest the NFT’s market with a first film completely financed in this way and directed by a certain director named Martin Scorsese. As you will have understood, the NFTs in their childhood will have benefited from powerful relays, stars, entrepreneurs and influencers. They are even a pledge of social affiliation, a closed and exclusive club that brings together a community of individuals who share the same family of NFTs.

First experience of the commercial metaverse, the enthusiasm surrounding NFT’s has only pushed the big companies to gear up to conquer a new world. Amazon has begun equipping itself with technologies from the metaverse, while eBay plans to launch its platform for selling NFTs. Avant-garde and visionary, the fashion sector has not escaped this dynamic to launch an attack on this new form of creativity. Fashion products, games and NFT’s works diversify the arsenal designed by Gucci, Louis Vuitton and Balenciaga in collaboration with renowned designers.

Although the harvest of glory may experience setbacks like the recent fall of NFTs with the bursting of the speculative cryptocurrency bubble, it is a fact that the mechanism fascinates and will continue to improve. NFTs have proven to the world that digital commerce is undergoing profound changes across the metaverse. More than a simple investment, it has transformed into a gateway to a new way of consuming by carving out the lion’s share of 21st century business.

A legal world to rebuild?

The changes in digital commerce are not entirely cloud-free and bring their share of questions. If digital, consumer and competition rights occupy a ready place when it comes to traditional marketplaces, certain sprains and hesitations must be raised in metaverse. On the one hand, it seems difficult to imagine the future of the metaverse without the decisive action of GAFAM, raising the question of a competitive asymmetry. On the consumer side, some advocate a legal extension of its personhood and legal protection in the metaverse, while the most conservative suggest a distinction of regimes.

Intellectual property law also seems to be affected by this development, with the uncertain legal qualification of NFTs having something to do with it. Since they are “legal aliens” that oscillate between deed and simple token similar to virtual currency, the actions attached to them are uncertain. The relationship between counterfeiting and NFTs has been the subject of several disputes in the United States. The court in New York decided in particular in favor of Hermès about the redirected rendering in a digital work of his iconic bags in the work Meta Birkin.

Rome was not built in a day, it will certainly take a few years for the metaverse to take root in practice and digital commerce to take on a new dimension. The rules of the game will certainly be determined by the practice and development of this new form of business and the mentalities surrounding it. Some lament the interruption of exchanges and the interruption of morality at the expense of a new way of consuming that will change in depth. The fact is that this phenomenon is already at our doorstep… It’s not a question of the future… but of the present!

Tribune written by Raphaël A. Hérimian, commercial lawyer

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