Navigating Finance in the Metaverse : A Series of Essays on Emerging Virtual Market With Insights for Islamic Finance

The thesis consists of five essays that examine the dynamics of Metaverse markets and financial services within this emerging virtual environment. It aims to explore the opportunities and challenges associated with advancing conventional and Islamic financial services within virtual environments.

The first essay employs bibliometric analysis to study scholarly publications in the field of finance within the Metaverse. Through a systematic examination of 267 documents, facilitated using Biblioshiny and VOSviewer software tools, this study provides a comprehensive overview of the academic landscape and identifies the gaps in extant literature. The study highlights the most influential works and authors, setting the stage for future research in this evolving domain. The second essay utilizes the novel Quantile Vector Autoregressive (QVAR) model to analyze the inter connectedness of volatility between the Metaverse market, represented by the Global Metaverse Index, and other pivotal financial markets, including Gold, Crude Oil, Bitcoin, Nasdaq, and the Volatility Index. This analysis demonstrates a significant level of interconnectedness at extreme quantiles and identifies Nasdaq as a primary transmitter of volatility to the Metaverse market.

The third essay applies the Wavelet Local Multiple Correlation (WLMC) method to evaluate the effects of economic uncertainties on Metaverse markets. The findings reveal that Metaverse indices exhibit dynamic responses to the volatility of the Twitter Economic Uncertainty Index. Furthermore, the study determines a positive correlation between the gold volatility index and Metaverse indices, whereas the correlation with the oil volatility index appears negative. Moreover, Bitcoin displays an insignificant correlation with Metaverse indices.

The fourth essay conducts a qualitative examination of the Metaverse market, presenting its principal sectors and key enablers. It draws analogies between the global transition to virtual reality and significant historical transformations, such as the Industrial Revolution. It articulates the primary drivers expected to influence the future development of virtual reality and financial services within the Metaverse. Furthermore, the study offers technological foresight into the short-and long-term prospects for financial services within the Metaverse.

The final essay builds on previous essays by examining the Metaverse market as a promising ground for the evolution of Islamic finance. It studies the perspectives and challenges faced by Islamic finance in the Metaverse, exploring initial Islamic engagements in virtual realities. Furthermore, it formulates strategic frameworks for advancing Islamic financial institutions into the Metaverse, equipping them with necessary information and tactics.Collectively, these essays provide valuable empirical and theoretical insights, enhancing our understanding of financial markets and services in the Metaverse. This work advances scholarship in virtual finance and offers practical strategies for integrating Islamic finance into the digital realms of the Metaverse.