According to the Wall Street Journal, pension funds throughout North America remain positive on cryptocurrencies despite bear market losses.
WSJ notes that asset management company VanEck reflects this interest. However, the dismal market circumstances of 2022 have prompted pension fund managers to contemplate whether to increase their cryptocurrency investments or withdraw.
In October of last year, a pension fund for Houston-based firemen invested $25 million in bitcoin and ether, only to lose more than half of its value from the bear market. Nonetheless, the $5 billion Houston fund’s management knew the nature of their investment. Ajit Singh, a chief investment officer of the Houston Firefighters’ Relief and Retirement Fund, told WSJ, “Volatility and significant swings are anticipated.”
Other pension funds see the bear market as an investing opportunity. During the crypto winter, when fewer individuals are ready to invest in cryptocurrencies, yields are more enticing, according to the chief investment officer of a Virginia-based pension fund. This pension fund for Fairfax police officers has $6.6 billion for around 30,000 people, 4.5% of which is in bitcoin.
Nevertheless, not all pension plans can withstand crypto’s volatility. A $300 billion fund for California teachers avoids crypto payments owing to their high risk.
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