KiwiSaver Growth Strategy, a $350 million retirement fund administered by New Zealand Wealth Funds Management, has set aside 5% of its liquid funds for investment in Bitcoin (BTC), highlighting institutional investors’ rising interest in gaining exposure to cryptocurrencies.
James Grigor, chief investment officer at New Zealand Funds Management, explained that remarkable commonalities between Bitcoin and gold are a main reason for entering the crypto bandwagon.
Grigor said “If you are happy to invest in gold, you can’t really discount bitcoin.” He further stated that Bitcoin will be a part of several KiwiSaver products in the forthcoming five years.
Grigor detailed that his company bought Bitcoin for the foremost time in October when it was worth $10,000. To process the trade, New Zealand Fund Management had to amend its offer records to permit crypto investments.
Bitcoin’s price hit an all-time high of about $61,800 earlier in March, implying a 6x return for KiwiSaver in a span of five months. Even though, Bitcoin is trying to consolidate at the current level, the pension fund is sitting over huge hypothetical profits.
Grigor detailed that KiwiSaver is “majority built up through traditional asset classes,” but pointed out that “other opportunities present themselves.” With respect to Bitcoin, the asset category is perceived to help “give people the best retirement they can get” via its vigorous compounding strategy.
Even though hedge funds and family offices have been consistently investing in Bitcoin, pension funds are probably the slowest to enter the crypto sector. The rise in institutional level product offerings could assist in expediting the adoption of Bitcoin.
The US based Grayscale has pointed out that pension funds are entering the crypto domain. Michael Sonnenshein, Grayscale’s CEO, said “The sizes of allocations they are making are growing rapidly as well.”
