The State of Michigan Retirement System recently made a significant investment by adding $6.6 million in Bitcoin ETF holdings. This move, which includes 110,000 shares in ARK 21Shares Bitcoin ETF (ARKB), was disclosed in a filing with the United States Securities and Exchange Commission (SEC) on July 26.
According to Bloomberg’s senior ETF analyst Eric Balchunas, the purchase of ARKB shares by the Michigan Pension Fund marks a notable step in the adoption of spot Bitcoin exchange-traded funds (ETFs) by pension funds in the United States. While the investment may seem small percentage-wise for Michigan, it sets a precedent as the third pension fund to report owning a Bitcoin ETF.
This development follows earlier investments in Bitcoin by other pension funds, such as the State of Wisconsin Investment Board (SWIB), which reported a $164 million investment in Bitcoin through BlackRock’s IBIT ETF and Grayscale’s Bitcoin Trust (GBTC). Additionally, Jersey City Mayor Steven Fulop disclosed that the city’s pension fund is also exploring opportunities to invest in Bitcoin through ETFs.
The approval of spot Bitcoin ETFs on US exchanges by the SEC in January has played a significant role in encouraging public pension funds to consider such investments. Chateau Capital co-founder and COO Alex Valaitis predicts a continued trend in these investments, foreseeing that by 2028, all 50 states in the United States will have crypto holdings in their state pension funds. This could potentially lead to over 80% of American adults holding crypto assets directly or indirectly in the near future.
Bitcoin ETFs in the US have demonstrated strong performance since their launch, attracting over $17 billion in inflows, as reported by Farside investor data. This trend showcases the growing interest and confidence in cryptocurrencies among institutional investors and public funds, paving the way for further adoption and integration of digital assets into traditional investment portfolios.