Jersey City pension fund to invest in Bitcoin ETFs

The State of Michigan Retirement System has invested $6.6 million in Bitcoin ETFs. This marks the pension fund’s first investment in digital assets. The fund oversees about $143.9 billion in assets for state employees.

Jersey City should not be engaging in speculative investments with public employees’ pension funds. https://t.co/TgKaYb8M0T pic.twitter.com/Ic1nA6FFrT

— Jim McGreevey (@jim_mcgreevey) July 27, 2024

The $6.6 million has been put into the ARK 21Shares Bitcoin ETF. This ETF has been available since January. Michigan’s investment is only the second known case of a pension fund investing in Spot Bitcoin ETFs.

Wow.

Breaking news: Michigan's pension fund made a notable investment in #Bitcoin.

They join Jersey City who also invested in it for their state pension.

Source: https://t.co/rg7f7PSq7A

Do you have your .Crypto? I do! Sandy.Crypto@unstoppableweb pic.twitter.com/P8mRneTxFJ

— Sandy.ubu (@sandy_carter) July 26, 2024

Michigan’s move shows that traditional institutional investors are increasingly accepting crypto assets. Earlier this year, Wisconsin’s retirement system disclosed investments in BlackRock’s iShares Bitcoin Trust and the Grayscale Bitcoin Trust (GBTC). These were valued at $99 million and $63 million respectively, as part of a $156 billion portfolio.

JUST IN: 🇺🇸 State of Michigan adds #Bitcoin ETFs to its pension fund, discloses $6.6 million purchase.

— Watcher.Guru (@WatcherGuru) July 26, 2024

JUST IN: 🇺🇸 Jersey City to allocate a percentage of its pension fund to buy #Bitcoin ETFs, Mayor announces.

— Watcher.Guru (@WatcherGuru) July 25, 2024

Retail investors have made up most of the $32 billion inflow into nine new Bitcoin ETFs over the past six months.

Jersey City funds to include Bitcoin

However, analysts are watching for changes in institutional demand, like Michigan’s investment. This could lead to wider institutional adoption. The trend is not limited to Michigan. The Mayor of Jersey City, New Jersey, Steven Fulop, has also announced plans to invest a portion of the city’s pension fund in Bitcoin ETFs. He is aiming for a 2% investment, but has not provided a specific timeline. These decisions show a growing interest in cryptocurrencies among public finance officials at various levels. Investing in crypto does come with risks for pension funds. There have been notable cases where pension funds faced big losses from their cryptocurrency investments. For example, the Montreal-based pension fund CDPQ lost a lot of money after investing in Celsius, which filed for bankruptcy in 2022. The increasing involvement of institutional investors in cryptocurrencies could significantly change the landscape of pension fund investments. This development may also contribute to broader acceptance and integration of digital assets within conventional finance.