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RE: First U.S. Pension Funds invest in Crypto!

in #crypto6 years ago

The first thing I thought when reading that title was "I want a pension fund that invests in crypto!" One of the primary problems with investing in crypto currently is that the governments of the world don't know how to treat it. It doesn't really fit into their known forms of previous investment. But if something like a pension fund invests in it, it's treated like a pension fund on your taxes. That's good news.

I think people into crypto, or that want to be in crypto, but maybe don't quite understand it, will be interested in things like this. I think they'll find far more interest in it than they even expected, because more people are interested in crypto than actually hold it. When they see some sort of investment fund that has crypto as one of it's investments, they might pay more attention to it, and be slightly more likely to choose that one.

If that happens...then a lot more pension funds might start putting a percentage into crypto, not only to diversify, but as a sort of advertisement.

With that being said, I hope more go for 4% or even 6%, rather than just 1%. Most probably won't choose to invest in crypto at all for a while yet, so if a few choose to have larger percentages, it will be good. We're not talking about 1% of 25.4 trillion, but maybe 1% of a few percents of 25 trillion. So, lets say pension funds controlling 5% of the pension market invest 4% of their holdings in crypto, that's 50,000,000,000. That's 50 billion dollars. Now that's a nice chunk of the crypto market. If those controlling 5% of the pension market only invested 1% of their holdings, that's 12,500,000,000, or 12.5 billion dollars. Still an alright chunk. But, for a real game changing number like your's, quite a few pensions would have to invest quite a bit. You'd likely have a few with somewhat larger chunks in crypto, and others with 1% or less in crypto.

Of course, crypto could have mooned and then crashed because large money like this actually did invest a bit, then sold at around the peak. There's a chance that if this sort of thing happens with pension funds, similar might happen. Hopefully they get in now, rather than after all the other pension funds do, and it's already at another peak.

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Yes, I think you are exactly right. Even if they don't buy that much, it adds legitimacy and credibility to the entire industry which will attract more capital. Either way we slice it, it's good news.