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- According to industry experts, more ETF providers will want to establish Web3 ETFs in the coming months since the trend provides access to crypto but with a different brand.
- Silver believes that around a half-dozen Web3 ETFs will be released in the next six months
- According to Silver, the Web3 concept is more appealing and “palatable” to regulators, politicians, and institutional investors today than pure cryptocurrencies
- “Finding a category that can acquire assets and marketing is the strategy” is at the heart of the ETF business, according to Permission.io CEO Charlie Silver.
Silver previously co-founded Onramp Invest, Blockforce Capital, and Reality Shares, the latter of which in 2018 launched the Siren Nasdaq NexGen Economy ETF (BLCN), one of the first blockchain equity ETFs.
According to Silver, the Web3 concept is more appealing and “palatable” to regulators, politicians, and institutional investors today than pure cryptocurrencies. He called the internet “the most important technical discovery in human history,” suggesting that investors will be interested in investing in its future.
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A half-dozen Web3 ETFs will be released in the next six months
According to a regulatory filing, Simplify Asset Management filed to launch a Web3 ETF last week, which would invest in companies focused on or expected to benefit from “shifting the bases of technology infrastructure from a centralized self-hosted hardware infrastructure to a decentralized cloud infrastructure.”
The US Securities and Exchange Commission (SEC) has yet to approve the launch of an ETF that invests directly in bitcoin. In October, regulators approved the introduction of bitcoin futures-based ETFs.
However, Tad Park, CEO of Volt Equity, which is the subadviser for the planned Simplify Volt Web3 ETF (WIII), believes there is another side to cryptocurrency that isn’t focused on bitcoin and its role as digital gold.
Silver believes that around a half-dozen Web3 ETFs will be released in the next six months and that one of the larger ETF issuers, such as BlackRock or State Street Global Advisors, would participate. He goes on to say that such funds will “wake up” the venture capital and private equity groups to pay greater attention to the sector.
Investment in Metaverse
According to the early prospectus for the planned Simplify fund, it will invest in metaverse enterprises in addition to Web3 companies.
Several metaverse ETFs are already available in the United States, including Roundhill Investments’ Roundhill Ball Metaverse ETF (META), which debuted in June and now has $923 million in assets. Furthermore, First Trust and ProShares filed for metaverse ETFs in December 2021.
According to industry observers, the equity ETFs in the crypto and blockchain technology categories have comparable holdings, including non-pure play firms.
However, Volt’s Park pointed out that Amplify Investments’ Transformational Data Sharing ETF (BLOK) — the largest blockchain ETF, with around $1.1 billion in assets under management — has gradually incorporated crypto enterprises such as mining companies.
Park noted that Volt Equity will keep an eye on Web3 firms that go public and that investing in such companies may encourage more people to enter the field.