U.S. Houston Firefighter’s Pension Fund Invests $25 Million in Bitcoin and Ethereum

Houston Firefighter’s Pension Fund has stated that it made some significant investment into the crypto space, another sign that retirement investments are taking crypto assets seriously despite regulatory concerns.

The Houston Firefighters' Relief and Retirement Fund announced on Thursday, October 21, that it bought $25 million worth of Bitcoin and Ethereum through the assistance of NYDIG (New York Digital Investment Group).

The fund, which has $5.5 billion in assets under management, stated that it has been managing the investment for several years now.

Ajit Singh, the chief investment officer at Houston firefighter’s pension fund, talked about the development and expressed belief in the disruptive potential of cryptocurrencies. He said: “We have been studying this as an asset class to add to our investment portfolio for quite some time. It became an asset class we could not ignore anymore.”

Singh showed his confidence that the cryptocurrency investment will pay off, stating that: “I see this as another tool to manage my risk. It has a positive expected return and it manages my risk. It has a low correlation to every other asset class.”

Singh stated that they preferred investing in direct tokens, and that explains the reason why Houston firefighter’s pension fund invested in actual cryptocurrencies, instead of taking on risks associated with futures-related investments.

“We didn’t want to get the synthetic exposure. We decided to go directly to the token. As more and more institutional adoptions happen, there will be more and more dynamics that develop for supply and demand. And having physical assets — actual tokens — gives us in the future the possibility of income generation potential,”

Houston firefighter’s pension fund is responsible for managing the benefits of more than 6,600 active and retired firefighters as well as survivors of firefighters. 

According to the group, more than half of the fund is invested in common and private equity, but also includes real estate, domestic stocks, cash, bonds, and international stocks.

Retirement Funds See Interest

According to the National Association of State Retirement Administrators, public pension funds oversee about $5.5 trillion worth of assets.

The Houston firefighters pension fund is not the first to enter into the cryptocurrencies, two pension funds in Virginia State purchased crypto investments some two years ago and recently mentioned they are planning to expand their investments by another $50 million.

As reported by Blockchain.News in February 2021, California Public Employees' Retirement System (CalPERS), the largest U.S. public pension fund, increased its stakes in RIOT blockchain, a Bitcoin mining firm. The California-based public pension fund, worth nearly $450 billion, first purchased 16,907 RIOT shares during Bitcoin’s 2017 bull run.

In June, retirement plan provider ForUsAll offered an option to its clients to invest up to 5% of their portfolio assets in cryptocurrencies, stating the US citizens could be disadvantaged if they are not given the option of accessing cryptocurrencies in their retirement plans.

Grayscale Investments also stated this year that it has witnessed a rising number of pension funds and endowments actively investing their funds to get exposure to cryptocurrencies.

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