#Pension Fund Tests Waters With Bitcoin#

In recent years, the price of Bitcoin has surged, attracting a growing number of institutional investors, including pension funds. Pension funds in Wisconsin and Michigan, USA, have become among the largest holders of US stock market funds that specialize in cryptocurrencies, while some pension fund managers in the UK and Australia have also made small allocations to Bitcoin through funds or derivatives in recent months. Mercer, a UK pension fund consultancy, has received a surge in inquiries since the US election, with trustees unwilling to be left uninformed about the popular asset class. Most pension funds have turned to regulated US spot Bitcoin or Ethereum ETFs that were approved last year. Cartwright, a UK pension consultancy, has facilitated the first Bitcoin transaction, with a small, undisclosed pension scheme directly investing around £1.5 million in Bitcoin, hoping to fill funding gaps with excess returns. Meanwhile, over 50 individual savers have sought to move their entire pension pots into cryptocurrencies. Cartwright is exploring the possibility of establishing a Bitcoin fund with two multi-employer pension funds. AMP Capital, an Australian pension fund manager, is also using Bitcoin to boost returns. Despite the high risk and novelty of cryptocurrencies, their scale and potential cannot be ignored, so AMP's portfolio has made a moderate allocation to Bitcoin futures. However, funds allocating to Bitcoin and other cryptocurrencies are still a minority in the pension industry, with most advisors reluctant to advise clients on cryptocurrencies.