The pension fund added cryptocurrencies to their investment portfolio, as they have grown too much to ignore them. There will be more supply and demand dynamics as the number of institutional adoptions increases.
The Houston Fire Relief and Retirement Fund recently bought USD 25 million worth of Bitcoin (BTC) and Ether (ETH). In that way, the American public administration gets closer to investments in crypto assets.
To make the purchase, the pension fund used the New York Digital Investment Group, Bloomberg reported.
Until June, the pension fund had more than USD 4.1 billion in total net assets. According to public records through the Texas comptroller’s office, the group has allocated approximately 0.6% of its portfolio to crypto assets.
Ajit Singh, the fund’s chief investment officer, said they had considered adding cryptocurrencies to their investment portfolio. He commented that those assets had grown so much that no one should ignore them.
The Fund Has USD 5.5 Billion in Invested Assets
The Houston Fire Relief and Retirement Fund has already invested USD 5.5 billion in assets. Those in charge of it said that USD 25 million would be a significant amount to dedicate to crypto assets. The New York Digital Investment Group subsidiary served as a vehicle for the fund to acquire the cryptocurrencies.
Furthermore, the pension fund controls retirement benefits for around 6,600 active and retired firefighters. While active firefighters have contributed 9% of their salary to the fund, the city of Houston has given at least 18%.
Singh expressed that he preferred to invest directly in cryptocurrencies rather than risk investments related to futures contracts. The executive explained that they did not want to get the synthetic exposure, so they decided to go directly to the token.
The fund’s chief investment officer noted that there would be more supply and demand dynamics as the number of institutional adoptions increases. He also commented that having actual physical assets or tokens would offer the possibility of generating potential income.
The United States Leads the Adoption of Bitcoin and Other Cryptocurrencies
The number of public institutions in different countries that invest in cryptocurrencies is growing. Many governments are taking steps to regulate digital assets as they are already in daily use.
In the case of the United States, this country has made considerable progress in terms of cryptocurrency adoption. In addition, each local government is creating new use cases for those assets.
The city of Miami is one of the best-known examples of adoption by the US public administration. The population accepted Bitcoin as a method for paying taxes or fees, thus becoming a pioneer.
The mayor of that city, Francis Suárez, was one of the initial promoters of that system. Houston wants to follow Miami’s lead in adopting crypto assets for different functions.
Cryptocurrencies like Bitcoin and Ethereum have become a crucial part of the world economy, which governments and regulators can not ignore. The adoption of those assets by the public administration will allow them to receive substantial profits.
By Alexander Salazar
