Union Investment, a Frankfurt-based asset management firm, is adding Bitcoin to its numerous funds.
According to Bloomberg, Daniel Bathe, senior commodities portfolio manager, the allocation will be limited to 2%: We are exploring incorporating bitcoins into a couple of additional funds for private investors in tiny sums of up to 2%.
Union Investment intends to increase its Bitcoin exposure beginning in the fourth quarter, although no specific timetable has been set at this time.
The business, which manages 368.2 billion euros (about $437 billion), first experimented using Bitcoin in early 2021. One of the firm’s mixed investment funds now includes delta-one certificates that monitor the value of the largest cryptocurrency (PrivatFonds Flexibel Pro). Bitcoin accounts for less than 1% of the fund’s $352 million portfolios, which is highly weighted toward stocks (80.32 percent ).
Institutions’ floodgates opened
As reported by U.Today, on Aug. 2, a new rule allowing German institutional funds (Spezialfonds) to invest up to 20% of their portfolio in Bitcoin took effect.
The decision was hailed as a significant step toward institutional adoption in Europe, given the potential for a $415 billion inflow into digital assets.
Needless to say, German funds will not rush into crypto, with analysts noting that they would take a cautious approach. Recognize the existence of a store of value Bathe asserts that Europe is catching up to Wall Street’s “store of value” concept, which took hold in late 2020:
We have seen that this trend is spreading to Europe as well. That is something for which we wish to be prepared. Many perceive Bitcoin to be a surefire inflation hedge, owing to global quantitative easing. Some German banks are reportedly refusing deposits from clients due to negative interest rates.
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