#Bitcoin allocation in pension funds#
Hot Topic Overview
Overview
In recent years, the trend of pension funds allocating to Bitcoin has been on the rise. Pension funds in Wisconsin and Michigan, USA, have become among the major holders of US equity funds focused on cryptocurrencies, and some pension fund managers in the UK and Australia have also begun to allocate small amounts to Bitcoin through funds or derivatives. While most advisors are hesitant to recommend clients to venture into cryptocurrencies, some pension fund consulting firms have begun to facilitate Bitcoin transactions and explore the possibility of establishing Bitcoin funds. AMP Super, an Australian pension fund management company, has also utilized Bitcoin futures to boost returns. Although Bitcoin is high-risk and novel, its size and potential cannot be overlooked, leading to more and more pension funds experimenting with allocating to Bitcoin in pursuit of excess returns.
Ace Hot Topic Analysis
Analysis
In recent years, the surge in Bitcoin prices has attracted an increasing number of institutional investors, including pension funds. Pension funds in Wisconsin and Michigan, USA, have become major holders of US stock market funds focused on cryptocurrencies, while some pension fund managers in the UK and Australia have also begun making small allocations to Bitcoin through funds or derivatives. This trend stems from the desire of pension funds to achieve outperformance by investing in hot asset classes and fill funding gaps. For example, Cartwright, a UK pension consulting firm, has facilitated the first Bitcoin transaction, with a small, undisclosed pension scheme investing approximately £1.5 million directly in Bitcoin. AMP Capital, an Australian pension fund manager, has also used Bitcoin futures to enhance returns. However, funds allocating to Bitcoin and other cryptocurrencies remain a minority in the pension industry, with most advisors hesitant to advise clients to venture into cryptocurrencies due to their high risk and novelty.
Public Sentiment · Discussion Word Cloud
Public Sentiment
Discussion Word Cloud
Classic Views
Pension funds begin to experiment with small allocations to Bitcoin, hoping to generate excess returns.
Pension funds in Wisconsin and Michigan, US, have become major holders of US stock funds focused on cryptocurrencies.
Some UK and Australian pension fund managers have made small allocations to Bitcoin through funds or derivatives.
Most pension funds have shifted to regulated US spot Bitcoin or Ethereum ETFs approved last year.