According to Cointelegraph: Bitcoin is now regarded as a viable asset class alongside gold and other alternative investments, a big change compared to five years ago. The cryptocurrency market's universal reach means decisions by regulatory bodies like the U.S. SEC on ETFs significantly impact Bitcoin's prices worldwide.
In March, Japan's colossal Government Pension Investment Fund (GPIF) declared it was considering Bitcoin as part of a new diversification strategy. The announcement by GPIF, the world's largest public pension plan with a $1.5 trillion portfolio, resonates far beyond Asia because Japan is known for its regulated and advanced economy that is protective of its workers' retirement savings.
However, there are questions around Bitcoin's notorious volatility and its integration into these conservative investment portfolios. Also, it remains to be seen how new spot market Bitcoin ETFs will influence institutional investors' diversification strategies involving Bitcoin.
Lucas Kiely, CIO at Yield App, acknowledges the influence the GPIF wields and the impact of the GPIF's decision. Chief Investment Officer at Bitwise Asset Management, Matthew Hougan, suggests that this statement by GPIF signifies Bitcoin's place at the asset investment table.
Recently, a bill was introduced in Arizona encouraging the state's retirement system to explore digital assets and Bitcoin ETF investment. Referencing Bitcoin's market cap surpassing $1 trillion, the Chamber of Digital Commerce supports the initiative, stressing the potential returns and the need for portfolio diversification.
Despite being known as risk-averse, pension funds like the GPIF in Japan and endowments of elite U.S. Universities like Yale, Stanford, and MIT have explored or invested in crypto, contributing to Bitcoin recognition as a credible asset class. Persistent low-yield environments and the cryptocurrency's recent integration into ETFs have also boosted its appeal to institutional investors.
David Tawil from ProChain Capital perceives a growing acknowledgment of Bitcoin's consistency as an asset class. Meanwhile, Brian Dixon from Off the Chain Capital claims education and traditional investing mindsets remain the chief challenges to Bitcoin's widespread adoption among pensions.
Still, many in the cryptocurrency community remain upbeat, suggesting that Bitcoin's adoption into pension portfolios is just a matter of time. The Swiss pension plans' recent adoption of Bitcoin ETFs may signal the start of this trend.
