The Houston pension fund, worth $5.5 billion, has made an investment in bitcoins and ether. This investment is the first in digital assets made by a U.S. public pension plan strong>
“A Watershed Moment for Bitcoin, and Its Place In Public Pensions”
Houston Firefighters Relief and Retirement Fund (HFRRF), which is the pension fund for Houston’s firefighters, announced that it had bought bitcoin and ether to enhance its defined benefit plan portfolio. This announcement describes:
This is the first public investment by a U.S. public pension plan in digital assets.
Bloomberg reports that the Houston Firefighters Relief and Retirement Fund owns $5.5 billion and has invested $25 million in bitcoin, ether and other digital assets. The New York Digital Investment Group (NYDIG), Stone Ridge Asset Management’s bitcoin investment arm, was instrumental in the transaction.
HFRRF Pension Fund provides retirement benefits to more than 6,600 firefighters, including survivors and active firefighters. Since 2004, active firefighters have contributed 9% to the fund, with Houston contributing at least twice as much.
Ajit Singh, HFRRF chief investment officer, stated that “We are excited about taking this first step into the world digital assets.” He elaborated:
Digital assets have been studied for some time. It has become an asset class that we cannot ignore.
He said, “This investment expresses the belief in the disruptive potential distributed ledger technology to the development and democraticization of value accumulation via disintermediation.”
Singh was also quoted by Bloomberg as saying: “I see this as another tool to manage my risk … It has a positive expected return and it manages my risk. It has a low correlation to every other asset class.”
The HFRRF chief investment officer preferred to invest in coins directly, rather than taking on risk associated with futures-related investments. He explained: “We didn’t want to get the synthetic exposure. We decided to go directly to the token. 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.”
Nate Conrad, global head of asset management at NYDIG, opined:
This investment represents a watershed moment for bitcoin and its place in public pensions. Fiduciaries are increasingly aware of how even a small allocation to digital assets can make a big impact over time.
