In a groundbreaking move for the UK’s financial landscape, a pension scheme has made a 3% allocation to Bitcoin, marking the first instance of institutional crypto adoption in the country. The allocation, valued at roughly $59 million, was facilitated by Cartwright, a UK-based pension advisory firm, following a thorough due diligence process to ensure risk management and alignment with the scheme’s overall portfolio strategy.
This strategic decision to include Bitcoin in the pension scheme’s portfolio reflects a growing trend among institutional investors seeking to diversify their assets and capitalize on the potential for asymmetric returns offered by cryptocurrencies. The allocation, according to Cartwright, is in line with the scheme’s long-term investment horizon and aims to achieve a balance between potential growth and managed risk.
Sam Roberts, Director of Investment Consulting at Cartwright, highlighted the evolving approach of trustees, stating, “Trustees are increasingly looking for innovative solutions to future-proof their schemes in the face of economic challenges.” This sentiment underscores the growing appeal of cryptocurrencies as a potential hedge against traditional market volatility and inflation.
Steve Robinson, Head of Investment Implementation at Cartwright, emphasized the robust operational security of the investment, assuring that their strategy combines a secure custodial solution with efficient profit realization. “Our commitment to engaging with emerging innovative technologies means we can ensure that trustees remain at the cutting edge of investment solutions,” Robinson added.
Cartwright believes that this pioneering allocation, similar to the early adoption of equities and high-yield bonds in previous decades, could set a precedent for other UK pension schemes. The firm predicts that this move will spark wider interest and adoption of cryptocurrencies within the institutional investment space.
The implications of this historic allocation and broader trends in institutional crypto adoption will be explored at Benzinga’s Future of Digital Assets event on November 19th. This event will provide insights into the evolving landscape of crypto investments and their role in the future of finance.
