On a mostly dead board BECAUSE I CAN MWAHAHAHA-- Ok let's get down to it. First of all, read this, it explains some of the stuff this will be based on, as well as stuff IN the theories. http://www.gamefaqs.com/boards/944059-fragile-dreams-farewell-ruins-of-the-moon/61880751 It's official, not officially translated but I trust it. Also note I haven't read the manga or the guide book.
1st theory: Shin and Glass Cage. I don't think Shin actually started it. He says he "secretly" made himself the first catalyst, implying there was someone to keep the secret from. And if he was the leader, there would be no reason to keep such a thing secret. You know the masked spirit thing, that you have to battle on multiple occasions? It is a higher-level AI than even Shin's AI. Someone would have had to have high priority in the project to be allowed to make such a thing, let alone want to (or maybe he was really messed up?). I think the creator of the AI in question was the original leader of the Glass Cage project, and just like Shin's AI is ever-so-slightly hinted to have a "personality" based on the real Shin's personality, the "personality" of the masked AI is probably also similar to the original leader's own personality. Shin's AI says that Shin was looked down upon, but I think it is rather that he was not trusted. He was undoubtedly younger at the time (which is why his AI takes the appearance of a young man). However, as the project was not completed at the time he rather recognized the mistrust as hate. Within this experience, he met the second catalyst, Sai. I haven't completely fleshed out my theories between that point and the "first apocalypse," though.
2nd theory: The First Apocalypse. This one is shorter. Basically, Glass Cage was a project meant to take empathy to it's fullest. It was something everyone was excited for and anticipated, but not everyone had time to take advantage of it at it's "release." Those that fell asleep taking advantage of it never woke up. The fatal outcome was recognized and a global broadcast was sent explaining it, but it was still too powerful to avoid simply because so many had died from it, which explains why in the memory stories everyone knew they were going to die. There were some strong enough not to die, but said people were sparse.
AAAAAAAAAAAND I have more but meh. Might explain that much later. And just to poke fun at how the board is 99% dead, anything specific you don't understand and I might make a theory up about it. On a completely different note, the story about Akane and Mao was so sad :<