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Metaverse Risks and Challenges: 6 Areas of Concern

  • 20 April 2023

Over the last couple of years, the development of the metaverse has increased, bringing us closer to a world where compelling virtual experiences are part of our everyday lives. For many, this is an exciting prospect. Businesses like Meta are promising to make our online connections more meaningful and intimate by bringing people together in realistic virtual environments that feel almost like real life. Others are proposing metaverse solutions for businesses that will make running global enterprises easier and cheaper. But while some are keen to welcome this new world with open arms, others are urging caution, pointing to metaverse risks and challenges regarding security and data privacy, among other concerns. Here, we try to unravel some of these worries to find out why it might be prudent to have a more circumspect approach to the metaverse.

6 metaverse risks and challenges

Crime and security

One reason to be cautious is the possibility of virtual crimes, something mentioned in previous Mazer blog posts. Scams have already led to unsuspecting users having their digital money and NFTs stolen. One example of this is the Neko Inu game. Play-to-earn games such as this are gaining in popularity as they offer players the chance to make money while they play, for example through forging items and trading them. The Neko Inu scam took advantage of this to steal many thousands of dollars from users.

But such fraudulent scams are not the only metaverse risk to watch out for. There have already been incidences of sexual harassment and bullying within the metaverse. In fact, the Center for Countering Digital Hate has discovered that under-18s have been exposed to graphic images, bullying, and extremist views in VR chat rooms. Users are able to create their own metaverse spaces within these chat rooms, where they can meet and interact with other people. This could be great for connecting people across the world, but the possibilities for it to be used for other more nefarious purposes are clearly there. Some are already concerned about this, with research group Morning Consult finding that 61% of US adults (from a selection of more than 4000 men and women) were concerned about sexual harassment occurring in the metaverse.

Though this is certainly a reason to be careful, fortunately, companies are already coming up with metaverse solutions for this. One such solution is the AI developed by Symbl. This has a deep understanding of human behaviors, tones of voice, and gestures, which it can use to detect inappropriate actions within the digital world. It can be used to identify and block people who contravene the rules of a site, while businesses can use it to warn their employees in real-time. For example, if a worker behaves inappropriately in the virtual world, saying or doing something which could be seen as bullying, they can be automatically warned and advised on how to correct their behavior. If it is repeated, then action can be taken to further reprimand the employee. Of course, with things like sexual harassment, prevention should be the priority, so companies will have to think more deeply about how to put protections in place for users in the metaverse, especially those who are under 18.

Data privacy

In the Morning Consult survey mentioned above, 79% of people stated that they were concerned about their data being exploited within the metaverse. This is a clear problem with any digital space, and companies have been wrestling with these kinds of issues for as long as the Internet has been around. With the metaverse though, we could be giving away even more of our data, with companies potentially able to take biometric data through wearable devices. Some believe that this could eventually be used to create highly realistic copies of people in the virtual world, which could allow someone to impersonate another in dangerously convincing ways.

And it’s not just individuals who could be affected by this – brands could be misused in the metaverse. Recently, users built a series of McDonald’s outlets on metaverse platforms like Roblox without the company’s permission. It ended up being good marketing for the fast-food chain, but it could easily be used to discredit brands. Many of the people building on Roblox and other platforms are children, so how will this be dealt with in legal terms? And how will trademark infringement be judged and enforced? At the moment, such infringement can be detected online, but will it be easy to transfer this technology to the metaverse? Clearly, there are many things to be considered around data privacy within the metaverse, both for brands and individuals.

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Equality and the digital divide

On the face of it, the metaverse has the potential to bridge the digital divide by helping developing nations by providing cheaper and easier access to online spaces. In parts of Africa, for example, there are limited transport links, making it difficult for companies to collaborate with workers over long distances. However, with metaverse solutions for business, employees can be brought together to work closely with one another despite being on different sides of the continent. They could connect with people all over the world as well, providing new opportunities for foreign collaboration. Similar time zones across Europe and Africa mean that businesses can collaborate easily within the metaverse, taking advantage of customers in both regions to generate higher profits which can then remain in their local communities.

This all sounds great, but it will only bring equality if it is made available to people and businesses at all levels of society. It must be made open and inclusive, with interoperability being prioritized to prevent any unnecessary exclusivity. For this to happen, it will have to be affordable as well. If it is cheap, it will certainly have a chance of reducing the digital divide. However, if it requires expensive equipment, high-speed internet, and huge amounts of computing power, it may price businesses with less means out of the picture. So, a cautious approach is required again to ensure that the metaverse has an overall positive effect on the world.

Addiction and connection to the real world

Another reason to approach the metaverse with caution is addiction. During the pandemic, screen time massively increased as people were forced to work via Zoom and other digital means. Amongst young people, the increase was worryingly high, with one US study finding that the mean total daily screen use among a selection of more than 5000 adolescents was above 7 hours a day during the coronavirus lockdowns. This was up from pre-pandemic figures of less than 4 hours per day1. Such numbers show that there is a huge draw in our society toward digital and virtual realities right now. While this is a necessary and enjoyable thing for many, for some it leads to addiction. With more immersive experiences being created in the metaverse space, is it possible that this technology could create a new generation of addicts? It seems entirely possible, if not inevitable, that this is one of the risks of the metaverse that businesses will have to face, one way or another, despite Meta’s claims that they only aim to improve our virtual connections rather than increase the amount of time people spend online.

And what of our physical spaces in the real world? When addicts spend all of their time in the virtual world, they neglect the physical environment around them. While this may not happen to everyone, for those that it does, things could be very serious. Video game addicts, for example, have been known to ignore their families and even lose their jobs all because they couldn’t pull themselves away from the screen. Another related concern is if we expand this to the whole of society. With so much investment going into the virtual world, will the real world be neglected? Some have expressed concern over our connection to the places we live and our communities if the virtual world expands. Online communities can be great, and deep connections can be made within these online groups, but physical communities should still be an important part of our lives. Without them, it’s possible that the physical world around us will begin to deteriorate.

Control and regulation

Although some metaverse businesses don’t want regulation, seeing it as a place for decentralized finance and other facilities that have no government control, it is almost inevitable that this will need to come in at some point. Many platforms have attempted to regulate their space, but it has proven difficult to do so far. Thus, one of the biggest challenges for metaverse companies will be developing effective regulations that do not affect freedom within the virtual world too much.

The metaverse might face similar problems as social media, which has struggled with sensible regulation in recent years. Like social media, the metaverse could bring us closer together and allow even greater mass communication and online connection. However, it could also create even deeper social division through more powerful and compelling misinformation and manipulation. Governments have struggled to regulate social media and prevent it from affecting incredibly important events, such as elections and people’s reactions to the Covid-19 vaccine, so how will they deal with such influences in the metaverse?

Metaverse businesses will need to think carefully about how they are going to create healthy environments for people to interact within and encourage healthy behaviors that make metaverse spaces useful and pleasant to be in. They will also need to develop adequate policies and procedures for dealing with anyone who breaches these rules, as well as effective ways of enforcing them. Governments too will have to decide how to structure, manage, and regulate the metaverse sooner rather than later, but the lack of consistency and agreement in the regulation of the internet between countries around the world shows that this might be difficult. Singapore has taken a strict approach from the beginning, with their central bank rejecting more than 100 applications for licenses from cryptocurrency firms in December 2021, but it’s yet to be seen whether other countries will follow suit.

The environment

One final reason for caution that may not be as obvious is the effects of metaverse on the environment. Cryptocurrencies, which are an essential part of the metaverse, have come under the microscope recently for their huge carbon footprint, with one study showing that the carbon emissions of operating the Bitcoin blockchain in China will be around 130.5 million metric tons in 2024, exceeding the total yearly emissions from Czechia and Qatar2. Fortunately, Ethereum’s recent merger has cut its energy consumption by around 99.95%, which will hugely reduce its environmental impact, but with new cryptocurrencies always coming into production, companies will need to consider this as the metaverse develops.

The risks of the metaverse: conclusion

In the end, there are many reasons to be cautious in how we approach the metaverse. Being such a new technology, it’s hard to know what other problems might arise as it develops. However, it’s important to remember that the metaverse is a tool and as such can be used in both good and bad ways. It could be used to commit sophisticated cybercrimes or to deepen the digital divide, but it could also be used to authentically connect us with family members who live in far-flung places or to shop in more convenient ways. Imagine if we could dedicate more space to community projects, such as cafes and food growers’ associations, instead of having office blocks. Imagine if we could move shopping centers to the metaverse to free up space for more green areas in our cities.

Metaverse solutions for business are developing so quickly that it might not be long before we see these things happen, but we need to make sure we do things right to avoid the metaverse risks mentioned in this article. We must learn from the past and establish appropriate rules and controls on the metaverse without curbing the freedoms it offers. So, if your business is looking to enter the metaverse, approach it with caution yes, but also with an open mind and positivity to ensure that you get the most out of what it has to offer.

You might also like: How the metaverse will change the world?


    1. Nagata JM, Cortez CA, Cattle CJ, et al. Screen Time Use Among US Adolescents During the COVID-19 Pandemic: Findings From the Adolescent Brain Cognitive Development (ABCD) Study. JAMA Pediatr. 2022;176(1):94–96. doi:10.1001/jamapediatrics.2021.4334
    2. Jiang, S., Li, Y., Lu, Q. et al. Policy assessments for the carbon emission flows and sustainability of Bitcoin blockchain operation in China. Nat Commun 12, 1938 (2021). https://doi.org/10.1038/s41467-021-22256-3
What are some risks and challenges associated with the metaverse?

The risks and challenges of the metaverse include crime and security concerns such as virtual scams, sexual harassment, and bullying. Data privacy is another issue, as there are concerns about the exploitation of personal data and potential misuse of brands. Equality and the digital divide may arise if access to the metaverse is not affordable and inclusive. Addiction and the connection to the real world are concerns, as excessive engagement with the virtual world may lead to neglect of physical spaces and relationships. Finally, the control and regulation of the metaverse pose challenges in creating effective regulations without stifling freedom within the virtual world.

What are the concerns regarding data privacy in the metaverse?

Data privacy concerns in the metaverse include the potential exploitation of personal data and the risk of biometric data collection through wearable devices. There is a possibility that such data could be used to create realistic digital replicas of individuals, which could lead to impersonation and fraudulent activities. Furthermore, the misuse of brands within the metaverse, as seen with unauthorized McDonald’s outlets, raises questions about trademark infringement and legal repercussions. Ensuring data privacy for both individuals and brands is crucial in the metaverse, and companies will need to develop appropriate safeguards and regulations.

How can the risks of addiction and disconnection from the real world be addressed in the metaverse?

The risks of addiction and disconnection from the real world in the metaverse can be addressed through awareness, education, and responsible use. Companies and individuals should promote healthy behaviors and set limits on screen time and virtual engagement. Creating a balance between the virtual and physical environments is crucial. For individuals, setting boundaries and being mindful of the time spent in the metaverse can help maintain a healthy connection to the real world. It is also important for companies to encourage breaks, emphasize the importance of offline relationships, and ensure that the development of the metaverse does not neglect physical communities and the environment.

Unlock the future with Mazer: Your innovation partner.

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Rafał Siejca

Rafal was a true early adopter of virtual reality and has a deep passion for the subject. He bought his first VR device more than two decades ago, was the first Oculus PL backer on Kickstarter, and has become one of the most prominent experts on VR and XR technologies in his home country of Poland. His personal interest has extended into his corporate life as well, where he worked as an IT Manager for PZU Group and an Expert at Bank Millennium before moving into the world of corporate VR, where he has amassed a decade of hands-on experience designing VR solutions. He is also a true metaverse fanatic who has put his heart and soul into building Mazer Space with the help of his talented team of developers, achieving magnificent results. As CEO and CTO, he ensures that each project is delivered on time to the highest possible standard.

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