North Carolina's Retirement Fund Considering Bitcoin Investment Worth $127 Billion
Cryptocurrency Makes Its Way to North Carolina Pension Fund
Here's the latest scoop: North Carolina legislators are gearing up to vote on a bill that could potentially allow the state's public funds to invest in Bitcoin. This includes funds for pension benefits of police officers, teachers, firefighters, and more, boasting a whopping $129 billion in assets and catering to over a million members.
As of right now, the fund's portfolio primarily consists of public equities, investment-grade fixed income, real estate, and certain non-traditional alternative investments, like private equity. But if this bill passes, a slice of up to 5% of the pile could find its way to Bitcoin, provided it meets the necessary market cap thresholds.
The bill, originally proposing a 10% allocation, has been toned down. Furthermore, it mandates the implementation of secure custody solutions for crypto holdings instead of the state treasurer having sole control over it. GPIO 92, the bill in question, has already passed through the House of Representatives, with 71 votes in favor and 44 votes against.
Now, the ball is in the Senate's court. If it signs off on the bill, the Treasury will initiate feasibility studies to explore the creation of a Bitcoin reserve that could be funded by seized cryptocurrency assets. The exact allocation mechanism remains uncertain, as it's unclear whether it would apply to individual retirement funds or the entire portfolio.
This move sparks controversy, with critics dubbing it "gambling with retirement funds" due to Bitcoin's infamous volatility. However, proponents argue that the diversification benefits and Treasurer Brad Briner's stringent investment guidelines could prove beneficial for the future of the fund.
Stay tuned for more developments in this intriguing tale of crypto and retirement funds!
Extra Tidbits:- The legislation establishes the North Carolina Investment Authority, led by members with at least 10 years of pension/endowment management experience.- Some opponents point to Justin Bieber's depreciated Bored Ape NFT as evidence of crypto's unpredictability, while supporters emphasize the potential benefits of diversification and strict investment guidelines.
- The North Carolina pension fund, with a market cap of $129 billion, could potentially invest up to 5% in Bitcoin, if the current bill passes.
- The bill, GPIO 92, mandates the use of secure custody solutions for Bitcoin holdings, instead of giving the state treasurer sole control.
- The allocation mechanism for Bitcoin in the North Carolina pension fund is uncertain, as it's yet to be decided whether it will apply to individual retirement funds or the entire portfolio.
- The legislation proposes creating a Bitcoin reserve, which could be funded by seized cryptocurrency assets if the bill is signed off by the Senate.
- Proponents of the bill argue that the diversification benefits and stringent investment guidelines could prove beneficial for the future of the fund, despite Bitcoin's volatile nature.
