Once known as a crypto-skeptical institution, HSBC originally announced its first major step into the metaverse in mid-March.
HSBC Holdings has launched a fund to capture investment opportunities in the metaverse for its wealthy clients in Hong Kong and Singapore as financial services firms take advantage of Silicon Valley’s new virtual reality.
In a statement on Wednesday, HSBC said its Metaverse Discretionary Strategy portfolio, managed by its asset management division, would focus on investing within the metaverse ecosystem across five segments: infrastructure, compute, virtualization, experience, and discovery, and interface.
The Metaverse Ecosystem
“The metaverse ecosystem, while still in its infancy, is rapidly evolving,” said Lina Lim, regional director of discretionary and investment funds and wealth solutions, Asia Pacific, at HSBC. “We see a lot of exciting opportunities in this space as companies of different backgrounds and sizes are joining the ecosystem.”
Nicholas Dowell, portfolio manager at HSBC Asset Management in London, noted that the metaverse concept is important to HSBC as a major milestone in the evolution of the internet. He stated that, “Many see the metaverse as the next stage in the evolution of the Internet, and the effect it has on our daily lives is expected to be as impactful as what we saw in the early 1990s.”
The metaverse comprises a network of virtual environments accessed through different devices where users can work, socialize and play. It has come into more focus since Facebook changed its name to Meta last year to reflect its commitment to the sector.
HSBC said they designed its discretionary portfolio for its professional high-net-worth and ultra-high-net-worth investors and accredited investor clients in Hong Kong and Singapore.
Last month, HSBC said it was buying a plot of virtual real estate in online gaming space, becoming the second global bank to invest in a popular metaverse platform after JPMorgan established a presence in Blockchain-based Decentraland.
HSBC is investing $3.5 billion in its personal and wealth banking business, in line with its ambition to become Asia’s leading wealth manager by 2025.
HSBC’s Moves Until now and Ahead
On March 16, HSBC officially announced plans to purchase land in the virtual reality world within the Blockchain game The Sandbox for an undisclosed amount. With $2.4 trillion in assets under management, HSBC plans to focus specifically on financial education offerings and work with sports partners, brand ambassadors, and Animoca Brands to co-create educational experiences.
Global wealth managers including UBS and Credit Suisse have increased the number of employees in Asia as countries like China and India minted more billionaires and millionaires.
By entering the industry metaverse, HSBC became one of the first major banks in the world to open its own space in virtual reality. In February, investment bank JPMorgan became the first major bank to join the metaverse by launching a blockchain-based virtual lounge on Decentraland to capitalize on a $1 trillion market opportunity.
While moving forward with metaverse adoption, HSBC has not been a big fan of cryptocurrencies like Bitcoin (BTC). In September 2021, HSBC Group CEO Noel Quinn outlined the company’s commitment to supporting central bank digital currencies and highlighted skepticism about the risks associated with cryptocurrencies and stablecoins. He previously argued that HSBC was not interested in running a cryptocurrency trading desk or offering any cryptocurrency investment services to its clients.
By Audy Castaneda
