Lots of people have created Real Mario Kart videos all over the Internet, but not like this. The incredibly talented nerds at Waterloo Labs aren't recreating Mario Kart through clever video editing or a set of unenforceable house rules -- no, these guys made a fully functional recreation of Mario Kart. That means fully functioning weapons including pressurized canons, adjustable speeds based on powerups, grabbable powerups and go karts that disable when hit by weaponry.
All of the karts on the track are networked together using radio frequencies, which means there's a centralized system that keeps track of what weapons each racer has and which kart is getting hit with said weaponry. When a kart is hit, the iconic red shell for example, the kart will become disabled and generally crash off the track, as seen in the video. Fortunately, there's no evidence of that cheap blue shell that knocks out whoever is in first place.
Yes, this really is real Mario Kart.