These changes were mainly added due to the abuse of Willow burning things or attacking players in their first day.
It currently works by every player client sending the position of their items, head and hands to the server.
But they have their uses too.
I don't even feel like playing this game anymore.
Now with Half Life: Alyx, it got a lot of positive attention, so I believe we'll see a lot more big games like that in the future and make VR much less of a niche.
Not that he had much sanity, to begin with.