Metaverse ETFs on Rise in South Korea

The Metaverse exchange-traded funds (ETFs), a future internet replication, are now in high demand in South Korea. Business investors in the Technology Industry and other sectors are keying into the probable “internet successor.” The metaverse is a 3D digital idea that allows users access to several opportunities. It offers virtual experiences for online game players on video games like Fortnite, Pearl Abyss, and Minecraft. Also, it helps users connect with friends, conduct business activities, and so on. It is a digital platform that focuses on virtual and augmented reality, relevant now and in years to come.

The Metaverse ETFs launch in South Korea is the first in Asia. The launch yielded about $100 million in revenue. Since then, there have been eight metaverses ETFs in South Korea, making $800 billion in revenue. According to a data report by Samsung Asset Management, $800 million of the funds have been put in South Korea funds in metaverse. The South Korean Government has also invested over $338 million into more Metaverse ETFs such as KODEX K-Metaverse Active, Hanaro Fn K-Metaverse MZ, KBSTAR iSelect Metaverse, and Tiger Fn Metaverse.

Apart from tech companies and electronic chip manufacturers, major investors of ETFs are stocks affiliated to South Korea’s Entertainment Industry. South Korean pop music is anticipated to be fundamental to the popularity of the metaverse ETF in South Korea. This is because the metaverse is for users of headsets, smartphones, and digital glasses. For example, iOS and Android devices have the metaverse. Most of these device users make up the vast audience of the K pop Industry. Also, KODEX K-Metaverse includes shares of Hybe, owner of the music label for popular K-pop group BTS. 

Metaverse EFTs Revenue Impact on South Korea

With the metaverse EFTs making waves in South Korea, an increase in revenue is inevitable. Local and foreign Investors make about 70% of revenue in South Korea.

Sharma from Indxx said “the metaverse is touted as one of the most talked-about key topics of 2021 in South Korea,…These high fund flow numbers represent a generally positive outlook towards the metaverse theme…” 

Retail investors’ demand in Asia Pacific is on the rise daily. In the next 5 years, the possible inflow could be at $1.5 trillion to $5 trillion. Australian retail investors make up 33% of investors since October. These investments have been driving more ETF growth broadly.

In the US, institutional investors are taking the lead. They have acquired most US-owned ETFs. Citi (NYSE: C) recorded that currently, they own 40% of the ETFs while retail investors own 38.5%. Also in trading activities, institutional investors outdo retail investors both in the US and Asia. Comparing China and US retailers, China’s activity makes up 60% of the total trading volume while US retailers make up a little over 7%.