Metaverse Index And ETFs: The Latest Financial Innovations Making Investment In NFTs More Secure
Investing in the Metaverse and NFT industry is possible through various options. Although it requires a certain degree of cryptocurrency awareness and expertise, buying crypto assets and non-fungible tokens is the most straightforward one. However, using the Metaverse Index or an NFT ETF changes that narrative for the better.
More Investment Vehicles Are Beneficial
The Metaverse continues to generate many media headlines, primarily due to growing interest from established technology players and brands. Companies like Meta FB, Google GOOGL, Apple AAPL, Microsoft MSFT, and Nike NKE have conducted research and development concerning Metaverse opportunities. In addition, a virtual world blurring the lines with the real one introduces many opportunities to transform commerce, social activities, and work.
As these companies build excitement for the Metaverse, people are increasingly looking for new investment opportunities. Many missed the initial cryptocurrency train and only started paying attention to digital assets when Bitcoin hit $40,000. Although the leading cryptocurrency still has tremendous upward potential — as do Ethereum ETH/USD and others — many people believe they have lost the opportunity to get in “early and cheap”.
With the Metaverse and NFTs things are a bit different, though. Both trends are still relatively new, although several projects have already made multi-million dollar sales per asset. Examples include CryptoPunks and Bored Ape Yacht Club — two prominent NFT projects still generating tremendous sales volume today. Metaverse projects, including Axie Infinity, The Sandbox, and Decentraland have been successful in their own ways, with over $100 million of investment and a multi-billion dollar market cap in total.
Setting up an NFT or Metaverse portfolio often requires investing in multiple projects and hoping for the best, so to speak. Thankfully, things are improving a bit on that front. The recent addition of the Metaverse Index (MVI) and the Defiance Digital Revolution ETF make things more accessible and straightforward.
Why The Metaverse Index Matters
The Metaverse Index provides price exposure to the performance of over a dozen up-and-coming and prominent Metaverse projects. It makes for an appealing option for those looking to invest in the broader Metaverse space without committing to one specific project.
Crucial benefits of an investment vehicle like the Metaverse Index include:
A simple way to capture a growing market trend (Metaverse) without forcing investors to research and rebalance their portfolio manually
An index — basket of tokens — can offset volatility for one or multiple tokens
A more efficient approach to buying and selling individual tokens due to lower transaction costs
Transparent processes and rules to include/remove tokens
The Metaverse Index is accessible on the Ethereum mainnet, meaning it requires no centralized service providers to let users access this investment option. Users can interface with the token address directly to make an investment, making it a universally accessible vehicle.
The Benefits of The NFT ETF
An exchange-traded fund is mainly a passive way of seeking price exposure. ETFs are found across many industries, including finance, technology, and now non-fungible tokens (NFTs). Investors gain exposure to the performance of industry players catalyzing mainstream adoption of this technology. And NFT ETFs are emerging in the crypto world like The Defiance Digital Revolution ETF.
With NFT ETFs, they democratize access to investing in an exchange-traded fund tracking one of the more appealing trends in cryptocurrency and blockchain today. Moreover, an ETF removes the need for users to go through a steep learning curve on NFTs and the individual projects in this space. Additionally, users gain exposure to multiple collections and their price-performance through the ETF, rather than having to buy pieces from individual collections which may incur high transaction fees.
More Investment Vehicles To Follow
When it comes to investment preferences, there are numerous alternative options on the NFT market, as well as cryptocurrency brokerage services, and even regular exchange trading operations. NFT marketplaces are of particular interest in this regard since they can sell unique assets at flat rates or launch auctions for any number of accepted currencies. Investors should look into the given market and seek out items of interest that they can bid on and eventually acquire for later resale or collecting. The resemblance of marketplaces to traditional auction houses is present, as demonstrated by the likes of OpenSea, which positions itself as a venue for the sale of rare digital items and collectibles. There are many alternative platforms, including NBA Topshot, Rarible, Nifty Gateway, Axie, Mintable, Foundation, and others.
KuCoin has recently backed the launch of two funds to empower the innovation of Metaverse space and lower the barriers of investing in the metaverse for new users — Metaverse Fund launched by KuCoin Labs and The Creator Fund launched by KuCoin Ventures — to invest $100 million each in Metaverse, NFT, and Web 3.0 startups, funding these projects to develop and bring more innovative products. Projects will also get technical, marketing and consultancy support from KuCoin.
If buying an NFT instantly is not among the investor’s plans, they can always resort to venture capital firms engaged in investing in the given market, or the NFT and cryptocurrency industry infrastructure development niches. The downside is that accreditation as an investor is a prerequisite for engagement with venture capital.