Legal Implications of a Ubiquitous Metaverse and a Web3 Future

63 Pages Posted: 10 Jan 2022

See all articles by Jon Garon

Jon Garon

Shepard Broad College of Law

Date Written: January 3, 2022


The metaverse is understood to be an immersive virtual world serving as the locus for all forms of work, education, and entertainment experiences. Depicted in books, movies, and games, the metaverse has the potential not just to supplement real-world experiences but to substantially supplant them. This article explores the rapid emergence and evolution of the Web3 technologies at the heart of the metaverse movement. Web3 itself is a paradigmatic shift in internet commerce.
The article begins by exploring the competing economic and philosophical approaches to the future of the internet, which is being driven on one hand by the most successful internet advertising firms (Facebook and Google) as well as their videogame competitors (Roblox, Microsoft’s Minecraft, Epic Games, and Valve) and on the other hand by Web3 advocates focusing on cryptocurrencies, nonfungible tokens, decentralized finance (“DeFi”) and distributed autonomous organizations (DAOs). Limiting the focus on U.S. law, the article reviews three core areas for the development of the metaverse: the regulatory environment; the transactional essentials; and the limits on governmental intrusion into the metaverse.

The review of the regulatory environment includes state and federal gambling laws, money transfer laws, securities laws, and regulation of unfair and deceptive trade practices used to enforce privacy and cybersecurity obligations. The section on transactional essentials focuses on contracts between metaverse enterprises and their customers, antitrust and competition restraints, copyright protections, protections of biometric data and rights of publicity, and protections of customer speech in metaverse environments. Finally, the article addresses the need for the continuing evolution of the Fourth Amendment protection from search and seizures, the third party doctrine limitations on reasonable expectations of privacy, and the statutory protections under the Stored Communications Act.

The article highlights that although these doctrinal issues are not new, the scope of the metaverse and its potential social importance will reshape these doctrine in sometimes unpredictable ways. Technologists, practitioners, and regulators must be open to these shifts to appropriately develop the correct mix of user control, industry practice, and regulatory oversight.

Keywords: Web3, Metaverse, blockchain, cryptocurrency, DAO, Defi, Intellectual Property, Privacy, Cybersecurity, AML, KYC, CFIUS, Meta, Internet, deepfakes, synthetic media, FinCEN, SARs, ToC, EULA, Fourth Amendment, First Amendment, Social Media, Howey

JEL Classification: K12, K19, K22, K23, L12, L13, L23, L31, L41, L82, M13, M38

Suggested Citation

Garon, Jon M., Legal Implications of a Ubiquitous Metaverse and a Web3 Future (January 3, 2022). Available at SSRN: or

Jon M. Garon (Contact Author)

Shepard Broad College of Law ( email )

3301 College Avenue
Ft. Lauderdale, FL 33314
United States

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