Bitcoin
Wisconsin Pension Fund Dives into Bitcoin ETFs, Potential Expansion into Crypto
Wisconsin Pension Fund Dives into Bitcoin ETFs, Potential Expansion into Crypto
Wisconsin pension fund made headlines in Q1 by adding two cash funds Bitcoin (BTC) exchange-traded funds (ETFs) in your portfolio. This addition, valued at $164 million as of March 31, marks a significant step forward for institutional investments in crypto. The Wisconsin State Investment Board (SWIB) purchased shares of BlackRock’s iShares Bitcoin Trust (IBIT) and Grayscale’s Bitcoin Trust (GBTC), as revealed in a filing with the U.S. Securities and Exchange Commission in May.
The move raised eyebrows across the industry, given that large institutions, especially pension funds, typically avoid nascent ETFs such as those focused on spot Bitcoin. However, according to David Krause, a finance professor at Marquette University in Milwaukee, this is likely just the beginning of Wisconsin’s foray into cryptocurrency. Krause observed in an interview with PBS Wisconsin that SWIB has a history of innovative investments.
“The Wisconsin Investment Council has always been ahead of the curve,” Krause said. “As a fully funded pension fund, they have the luxury of investing with a long-term perspective without the same liquidity concerns that plague underfunded pensions like Illinois, which is only 50% funded.”
At the end of 2023, SWIB managed approximately $156 billion in assets, making its Bitcoin ETF holdings a modest 0.1% of its total portfolio. Despite the small percentage, Krause believes that this initial investment is a strategic move to assess public reaction and market performance. He anticipates that SWIB will increase its Bitcoin holdings over time and expects other pension funds to follow its example.