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It is believed that investing in metaverse ETFs provides easy and early entry to an industry touted as the next generation of the internet.
New York-based asset manager BlackRock is set to unveil a new metaverse ETF in its latest move in the crypto space.
The new fund, iShares Future Metaverse Tech, and Communications ETF will give investors exposure to metaverse-focused companies. This may include companies with links to digital assets, gaming, social media, virtual and augmented reality, and more.
This is not BlackRock’s first foray into the crypto ecosystem. Previously, it partnered with Coinbase to allow digital asset trading, custody, prime brokerage, and reporting.
Last week, BlackRock launched the iShares Blockchain Technology UCITS ETF targeted at European customers. The ETF tracks the New York Stock Exchange FactSet Global Blockchain Technologies capped index but hasn’t attracted much interest from investors.
As of the time of reporting, the firm had yet to reveal the fees and ticker for its new metaverse ETF.
How a Metaverse ETF Works
Since Mark Zuckerberg’s Facebook rebranded to Meta, there has been a growing interest in the metaverse. The trend has seen many companies like Alphabet, Microsoft, and Snap roll out metaverse products.
Metaverse ETFs provide investors who want exposure to the metaverse with diversified related stocks. With the metaverse growing at an average rate of 42.7%, these stocks will grow. Thus, investing in metaverse ETFs provides easy and early entry to an industry touted as the next generation of the internet.
Preparing for the Next Bull Run?
What’s surprising is that the launch of the new metaverse ETF comes at a time when interest in the crypto ecosystem is waning. According to Bloomberg, total Google searches for digital assets have reduced. Not even the Ethereum Merge could flip the downward market trend.
Todd Sohn, the ETF strategist at Strategas Securities, noted that the performance of other blockchain and metaverse funds shows a loss of interest. BlackRock doesn’t have to look too far to get proof. Its IBLC fund, which launched in April, has just about $6 million in total inflow.
Sohn also noted that there were already several active participants in the market. Notable among them are Global X FinTech ETF, ProShares UltraPro QQQ, Fidelity MSCI Information Technology Index ETF, etc.