BY RICHARD BEALES

In a merger of buzzwords from 2021, Breakingviews is readying a new metaverse-based buy-now-pay-later digital-asset trading platform. If that’s too much to swallow, here are a few other improbable – if, sadly, not impossible – financial product innovations that could rear their heads in the coming year.

First, how about combining blank-check companies with non-fungible tokens? NFTs are digital certificates that share technology with cryptocurrencies but are unique rather than interchangeable. They can be used, among other things, to authenticate ownership of digital assets. They are also all the rage, perhaps explaining why movie-theater chain AMC Entertainment, whose stock surged over 1,000% in 2021 through mid-December on the back of social-media interest, is offering an NFT to self-identified shareholders of the company.

Public offerings of special-purpose acquisition companies, which raise cash to buy other businesses, hit a record pace early in 2021 but have since run into investor indigestion and skepticism. They typically hand out warrants when they issue shares as a carrot to invest. Adding AMC-like NFTs as well – tradeable, crypto- powered proof that “I own this SPAC” – could be just the ticket to reinvigorate the market.

Another headline-grabber in the past year was Robinhood Markets, the stock and crypto trading platform that went public in July. One controversy that has helped tank its shares since then is its revenue model, dominated by so-called payment for order flow, or PFOF. This means market makers pay Robinhood to direct stock transactions their way for execution.

How could trading firms replace that revenue? Newbie cryptocurrency dabblers who don’t want to lose sleep at night might fancy an account in which their dollars are turned into bitcoin or ether each morning and back into dollars each afternoon. They’d collect the inexorable – right? – daily gains on the cryptocurrency, while the brokerage could rake in fees on those exchanges and avoid the taint of PFOF.

A third idea for a handy financial product in 2022 is what might be called the Tech Triple 12 ETF. Cathie Wood’s ARK Investment Management’s actively managed technology exchange-traded funds made waves in 2021. Passive ETFs, too, can be tailored tightly for specific stock characteristics. In exchange for a fee, this one would bet only on tech companies with a market worth above $3 trillion. By the time you read this, one company may qualify.

First published January 2022