Money and Markets

A new ETF wants to invest in everything related to the metaverse — except Mark Zuckerberg's Meta

Business Insider US

Meta CEO, Mark Zuckerberg.Photo by Liu Jie/Xinhua via Getty Images
Meta CEO, Mark Zuckerberg.Photo by Liu Jie/Xinhua via Getty Images
  • A metaverse-focused ETF is not just theoretically against Mark Zuckerberg's Meta — it's also shorting it.
  • Called the Subversive Metaverse ETF, the fund launched under the symbol "PUNK" on Thursday.
  • "We want to make sure this industry develops, without getting 'Zucked-up,'" its portfolio manager said.
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A punky new exchange-traded fund wants to invest in everything related to the red-hot metaverse — but not Mark Zuckerberg's Meta.

The former Facebook has run into a lot of resistance from crypto die-hards as it stakes out its turf in the metaverse, and even Hollywood star Keanu Reeves has spoken up.

Given that, the creators of the Subversive Metaverse ETF believe the tech giant just doesn't make a good poster boy for the emerging sector.

"Facebook seems to be the antithesis of what actual consumers want their digital futures to look like," Subversive Capital Advisor founder Michael Auerbach told Bloomberg in an interview published on Thursday.

"Mark and his team are not the best custodians of our digital futures," he said.

The actively managed Subversive fund, which launched on Thursday in the US, tracks globally listed stocks in companies involved in metaverse infrastructure and applications. It's listed on CBOE's BZX exchange with the ticker symbol "PUNK," in a reference to the popular CryptoPunk NFT collections.

Facebook changed its name in October to Meta, in a corporate shift to focus on immersive digital worlds. The move sparked a rally in metaverse cryptocurrencies, driven by retail and institutional investors, and focused Wall Street's attention on the potential of the emerging industry.

But fears sprang up almost immediately that the tech giant's industry heft and deep pockets could allow it to dominate the metaverse, just as it has become prominent in social media. Many in the crypto community worry their vision of a free, decentralised virtual world is in danger.

Keanu Reeves — who holds cryptocurrency himself — said in December: "Can we just not have metaverse be, like, invented by Facebook?"

Global metaverse-related ETFs have grown to over $2 billion since Meta's rebrand, with most products launching only in recent months, according to Bloomberg. Currently leading is the Roundhill Ball Metaverse ETF, which manages about $822 million in assets.

Yet not only is the Subversive fund shunning Meta, despite counting major industry players among its components — it also has taken a small short position against the stock. "Our mission here at Subversive is to question the integrity of the status quo — which is why the PUNK fund is short Meta — and build a foundation for people to appreciate these emerging sectors just as much as we do," Subversive's Christian Cooper said in a statement.

"We want to make sure this industry develops, without getting 'Zucked-up' from those who see the true potential of this space."

Cooper and Auerbach are the ETF's portfolio managers. They said companies selected for inclusion in PUNK's portfolio "will be engaged in the experience, discovery, creator economy, spatial computing, decentralisation, human interface, and/or infrastructure aspects of the metaverse."

PUNK's top 10 holdings include Roblox, Nvidia, Coinbase, Microsoft, and Alphabet.

Millions have been flowing rapidly into the metaverse industry, and Microsoft in January acquired Activision Blizzard for $69 billion in a gigantic metaverse bet.

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