The metaverse is leading the way as one of the hottest concepts in the history of exchange trade funds.
According to The Financial Times, using Morningstar data, a total of 35 metaverse-badged RTFs have launched globally since June 2021. This figure surpasses other classifications such as 32 for internet ETFs, 29 for blockchain, 23 for cloud computing, and 22 for cyber security.
The concept of the metaverse, which ties in virtual reality and augmented reality experiences has seen a lot of traction over recent years. Mark Zuckerberg made conversation around the topic in 2021 when he announced that he had a vision to build an alternate virtual space. Although his dream at Meta saw huge speed bumps last year with massive amounts of job layoffs.
Video games are innovating the metaverse
The video game industry naturally acts as the perfect space to develop these virtual environments. The metaverse is no new concept with games such as Secondlife and Habbo which launched in the early 2000s showing potential for a metaverse before the name was even used to describe them. Game titles such as Axie Infinity and Sandbox are more current iterations of metaverse titles.
Senior fund analyst for passive strategies at Morningstar, Kenneth Lamont commented that “It has always been our view that the metaverse is a multi trillion-dollar, multi-decade opportunity. There was no scenario in which we didn’t see a flood of other ETFs coming to market.”
While much of the current buzz around the metaverse is centred around video games there’s potential beyond that. Head of global index portfolio management at Franklin Templeton, Dina Ting believes that the real opportunities are in the combination of the digital and real world. The digital aspect could act as a working aide.
Potential beyond games?
We have already seen these ideas being explored in professional environments. Training surgeons and doctors are using VR and AR experiences to practice intense procedures. There’s also an entire nation that intends to build itself in the metaverse before its real-life counterpart comes to fruition. Apps such as Dropp also look toward the melding of the virtual and real world. Dropp has the ability to show users a 3D city interface of where they live and shows areas of interest.
For some the metaverse still feels like a concept in its infancy, however projects are constantly pondering the metaverse’s future potential. Metaverse games can be more than just a game, users can attend events and go to concerts. Artists can appear in more places as they won’t be bound to just physical appearances. Virtual worlds coexisting with our own could see major changes within the workplace. Some of these concepts are already set in motion, while others are just an idea of what may come next.
Venture capitalist, Matthew Ball commented on the metaverse concept saying “It’s the next generation internet. I would call It a master theme in the decades to come.”
Image credit to Sara Kurig