The Government Pension Investment Fund (GPIF) of Japan, recognized as the world’s largest pension fund, is reportedly exploring Bitcoin BTC/USD as a potential asset for diversification. This development comes amid a significant rally in the cryptocurrency’s value.
What Happened: THE GPIF is conducting research on a range of “illiquidity assets,” including bitcoin, to potentially broaden its investment scope, CNBC reported on Tuesday. While the fund’s traditional investments include bonds, stocks, and real estate, the exploration into bitcoin and other unconventional assets like forests and farmland is ongoing.
The GPIF’s interest in bitcoin coincides with the cryptocurrency’s new all-time high, following a year where its value increased by over 130%. This surge has been partly attributed to the launch of bitcoin ETFs in the U.S., which have attracted significant investments.
Historically, pension funds have been cautious about entering the volatile crypto market. However, some funds, such as South Korea’s National Pension Service, have begun to invest in crypto-related assets, including shares of Coinbase. Additionally, Japan’s government is considering legislation that would allow investment funds to hold digital assets, potentially opening the door for more institutional investment into cryptocurrencies.
Why It Matters: The GPIF’s potential move into Bitcoin is a significant indicator of changing attitudes toward cryptocurrency in institutional investment circles. Recently, Bitcoin experienced a flash crash, dropping to $8,900 on the BitMEX exchange before making a swift recovery. Despite this volatility, the global average price of Bitcoin remained around $67,400.
Earlier, speculations arose that Bitcoin could reach $100,000, bolstered by the approval of Bitcoin ETFs and the strong capital inflows that followed. Additionally, investors have shown confidence in Bitcoin’s value, with some betting on it reaching between $100,000 and $150,000.
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