Key Takeaways
- Wisconsin Pension Plan Likely to Invest Much More in Bitcoin ETF, Marquette Professor Says.
- The investment board has always been innovative and it's no surprise that it's experimenting with bitcoin.
- SWIB's current Bitcoin ETF holdings represent a negligible 0.1% of its $156 billion portfolio.
The State of Wisconsin Investment Board’s recent $164 million investment in spot Bitcoin ETFs is a strategic test, according to David Krause, a finance professor at Marquette University. This initial investment is seen as a preliminary move to gauge public reaction.
Krause highlighted Wisconsin’s innovative approach to investments, noting that the board’s willingness to invest in emerging assets like Bitcoin ETFs is not surprising:
Wisconsin’s investment board has always been innovative. This is a fully funded pension fund, allowing them to invest for the long term without the liquidity concerns faced by less funded pensions.
The SWIB purchased shares of BlackRock’s iShares Bitcoin Trust and Grayscale’s Bitcoin Trust, valued at $164 million as of March 31, a move that was revealed in a May SEC filing. Despite this significant investment, it represents a mere 0.1% of SWIB’s $156 billion portfolio.
Krause believes this investment is just the beginning:
I think they’re testing to see the reaction of the public and using it as a trial run
Krause predicts that SWIB will likely increase its Bitcoin ETF holdings and other pension funds may follow.
The trend of institutional investments in Bitcoin ETFs is growing, with nearly 500 institutional investors revealing allocations in the first quarter of the year. Millennium Management, a hedge fund, is the largest holder with $2 billion invested, accounting for approximately 3% of its total assets under management.
