Bitcoin's big pump is so tempting, even the pension fund got involved

Source: JIN10 Data

17.2 million dollars! Australia’s major pension fund rare allocation of Bitcoin…

Despite the high volatility of Bitcoin, which has deterred global large fund management companies, AMP, an Australian pension and wealth management company, has become one of the first major retirement fund management companies in the country to invest in cryptocurrency products, with an investment of approximately 27 million Australian dollars (17.2 million US dollars) in Bitcoin futures.

Steve Flegg, a senior investment portfolio manager at AMP, stated in a post on LinkedIn this week that the fund had ‘dabbled and moderately allocated to Bitcoin’ earlier this year. An AMP spokesperson said the fund invested in Bitcoin futures and added that there are no plans to increase holdings.

Bitcoin broke 100,000 US dollars for the first time last week and has risen more than 40% since Trump won the US presidential election in November. Trump openly supports cryptocurrencies and has promised to create a supportive environment for digital asset companies in the United States.

So far, Australia’s $4.1 trillion pension system has shown little enthusiasm for investing in cryptocurrencies. Reserve Bank of Australia’s head, Michele Bullock, recently stated that Bitcoin has no role in the Australian economy, while regulatory authorities have previously warned that ‘strong risk management controls’ must be used when engaging in activities involving digital assets.

Australia’s rapidly growing pension industry has been closely scrutinized for a series of issues, including non-listed market valuations, customer service, and investment costs. The industry undergoes an annual performance test aimed at eliminating underperforming pension investment products. Earlier this year, dozens of pension investment products offered by AMP failed the test, with most products failing for the second consecutive year.

AMP’s Chief Investment Officer Anna Shelley commented in an email that the investment in Bitcoin futures reflects the “structural changes” in the digital asset industry over the past year, including leading investment managers launching exchange-traded funds (ETFs) that directly invest in Bitcoin and Ethereum.

“After testing and careful consideration by our investment team and committee, we included a small and risk-controlled position in digital assets in May through our dynamic asset allocation plan,” she said, adding that the exposure was about 0.05% of its total pension assets.

The Australian Prudential Regulation Authority declined to comment on AMP’s investment in Bitcoin futures, instead quoting from a letter it sent to the financial industry in 2022.

Xie Li said, “While our VIP members benefit from this risk exposure, we fully understand the risks and volatility characteristics of this emerging asset class and will continue to prudently manage our holdings, which are a small part of a highly diversified portfolio.”

Source: Sina

Author: Market Information