The Houston Firefighters’ Relief and Retirement Fund in Houston, Texas, has invested $25 million in Bitcoin and Ethereum, Bloomberg reported on Thursday.
According to reports, the pension fund reportedly used the services of NYDIG, a crypto investment firm in New York, to buy cryptocurrencies.
More than 6,000 firefighters and their families participate in this pension fund, which amounts to $5.5 billion in assets as of June 2020. This is reportedly the first time the fund has allocated investments in cryptocurrencies.
The fund’s chief investment officer Ajit Singh revealed that they have been studying this asset class for quite some time and eventually could not ignore it anymore. He told Bloomberg:
“As more and more institutional adoptions happen, there will be more and more dynamics that develop for supply and demand. And having physical assets — actual tokens — gives us in the future the possibility of income generation potential.”
The total amount of pension funds managed by the State and local government pension funds has reached more than $5.5 trillion in assets. Moreover, the number of funds having exposure to cryptocurrencies is increasing.
For instance, two Virginia pension funds, which previously made investments in cryptocurrencies, have now planned to increase their exposure by another $50 million.
It was also recently reported that Australia’s fifth-largest pension fund, QIC, will also invest in cryptocurrencies in the future.
The inflow of funds from institutional investors is expected to increase in the future. Over 36% of institutional investors already have some level of exposure in cryptocurrencies and derivatives, as per reports by Fidelity Investments.