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As crypto becomes increasingly mainstream, more and more traditional financial institutions are beginning to look at digital assets as part of their investment portfolios. Faced with the very real risk of being left behind, several pension funds around the world have either made direct investments in crypto or are exploring opportunities. Here's a look at the countries where pension funds are actively considering or have already started investing in crypto in 2024.
1. United States
In the United States, several pension funds are looking at crypto as a possible asset for diversification. A notable example is Fidelity Investments, which offers BTC investment options for retirement plans, including 401(k)s.
State pension funds in the U.S. are currently exploring crypto investments. In a groundbreaking move, Wyoming recently passed legislation allowing public pension funds to invest in digital assets, positioning itself as a leader in the integration of cryptocurrency into traditional investment strategies.
2. Canada
Canada has taken a proactive approach to crypto adoption, with its pension funds beginning to diversify into digital assets. The Ontario Teachers' Pension Plan (OTPP), one of the largest pension funds in Canada, made waves when it invested $95 million in Blockstream, a company that provides BTC infrastructure. OTPP’s investment is part of their broader strategy to explore blockchain technology and emerging assets.
3. Switzerland
Long a hub for financial innovation, it’s no surprise that Swiss pension funds are increasingly exploring digital assets. While no major Swiss pension funds have yet fully integrated crypto into their portfolios, companies like Swiss Life have already begun experimenting with blockchain and crypto-related products. This exploratory phase suggests that Swiss pension funds will likely continue moving toward crypto investments in the near future.
4. Germany
Germany has made strides in crypto regulation, allowing pension funds to consider cryptocurrency as part of their diversified portfolios. In 2021, the German federal financial regulator, BaFin, approved investment products that include crypto assets. Some German pension funds are already gaining exposure to digital assets through crypto ETFs and other blockchain-based financial instruments.
5. United Kingdom
The United Kingdom is seeing increasing interest in crypto investments from pension funds. While cryptocurrency hasn’t yet become a mainstream investment within UK pension funds, there is growing interest in digital assets as part of a diversified portfolio. The rise of crypto ETFs in the UK is helping bridge the gap for pension funds seeking exposure to crypto without direct holdings. While adoption is still in the early stages, it reflects a growing openness to digital assets among UK institutional investors.
6. Australia
Australia’s superannuation system, which is the country’s mandatory pension system, has become one of the largest pools of assets in the country. Australian pension funds have expressed interest in crypto investments. For example, QSuper, one of Australia’s largest pension funds, has looked into BTC ETFs as a way to gain exposure to digital assets. The Australian Prudential Regulation Authority (APRA) is working on guidelines to allow pension funds to incorporate crypto into their investment strategies.
7. Japan
Japan’s Government Pension Investment Fund (GPIF), the world’s largest pension fund by assets under management, is actively exploring new avenues for diversifying its investment portfolio. Recently, the fund announced that it is researching illiquid assets, including crypto, as part of its efforts to consider expanding into alternative investments beyond traditional stocks, bonds, and real estate.
While GPIF has not yet made direct investments in crypto, the fact that it is requesting detailed information on digital assets is a clear indication that Japan's largest pension fund is seriously evaluating the potential for crypto in the future.
Regulatory Clarity Bringing Increased Crypto Adoption
Around the world, pension funds are beginning to view crypto as a viable investment asset. With BTC being a key player in this shift, countries like the United States, Canada, Germany, and Australia are leading the charge in integrating digital assets into traditional pension fund portfolios. As regulatory clarity continues to improve and crypto becomes more widely accepted, it's clear that pension funds are increasingly seeing crypto as part of a diversified investment strategy.