HomeNews$40 Billion Pension Fund To Invest In Bitcoin-linked ETF

$40 Billion Pension Fund To Invest In Bitcoin-linked ETF

One of South Korea’s largest pension funds, the Korea Teachers Credit Fund (KTCU), is planning to invest in various Bitcoin (BTC) exchange-traded funds (ETF). This is the first time the organisation has been exposed to the cryptocurrency industry.

The state pension fund was established to provide pension benefits to the country’s education workers. According to a report from Korea Economic Daily, the KTCU plans to invest in Bitcoin spot ETFs. The Union’s Investment Review Committee will determine the volume of the investment.

The fund decided based on its research, which showed that cryptocurrencies are gradually becoming a mainstream investment asset in the world.

KTCU, one of many largest institutional buyers in South Korea, is contemplating investing in a pure Bitcoin ETF or Bitcoin-linked ETF within the first half of 2022, native information company The Korea Economic Daily reported Monday.

The decision marks the first instance of a South Korean domestic pension fund allocating capital into cryptocurrency-related products. As of December 2020, the fund managed more than $40.2 billion in assets.

According to the report, KTCU is the second-largest institutional investor in South Korea, with $40.2 billion in belongings beneath administration. The pension fund has allotted 40% of its investments in different belongings, 10% home and 9% worldwide. KTCU will find out the dimensions and different particulars of its potential Bitcoin ETF funding.

“More Transparent and supervisiable ETF” – KTCU

The report notes that the firm’s decision to invest in Bitcoin was based on the judgment that cryptocurrency is gradually becoming a mainstream investment.

An additional impetus for the decision was the recent launch of the Bitcoin futures ETF in the US. This factor gave the asset legitimacy and made it a transparent product. Earlier attempts by fund managers in South Korea to hold such investments were disrupted by a negative perception of cryptocurrencies by the country’s financial regulators. This move by the Union could create a network effect for similar funds and asset managers alike.

“Bitcoin-related ETF began appearing one after another, the perception of BTC shifted towards being a more transparent and supervisable investment.”

– Korea Teachers Credit Fund (KTCU)

The report also points to other cases, such as the Houston Firefighters’ Relief and Retirement Fund (HFRRF) recently purchasing both Bitcoin (BTC) and Ethereum (ETH), as more validation of the growing cryptocurrency landscape.

Earlier this month, Australia’s fifth-largest pension fund announced that it would consider allocating some of the firm’s $69 billion into the crypto markets.

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