Florida’s Chief Financial Officer, Jimmy Patronis, has proposed investing a portion of Florida’s state pension funds in cryptocurrency, specifically Bitcoin.
Other states like Wisconsin and Michigan have started investing their pension funds in crypto. With all is issues surrounding the USD, it makes sense to buy BTC while it is still relatively unknown as an asset class.
In a letter to Chris Spencer, Executive Director of the Florida State Board of Administration (SBA), Patronis said that Florida has a strong economic position and innovative history to explore cryptocurrency investments.
Bitcoin Reserves
Patronis urged the state to capitalize on the growing cryptocurrency market. He suggested a “Digital Currency Investment Pilot Program” that could integrate well with the Florida Growth Fund.
There’s no telling what the future of #cryptocurrency will be, but FL must stay ahead of the curve on getting the best returns for Floridians. Today, I sent a letter to @FloridaSBA requesting a report on digital currencies. #BTC #Bitcoin
➡️ Read more: https://t.co/4JBL6WBtq1
— Jimmy Patronis (@JimmyPatronis) October 29, 2024
Patronis referred to Bitcoin as “digital gold,” advocating its potential to diversify the state’s investment portfolio and act as a hedge against other volatile asset classes.
“The State Board of Administration maintains a Florida Growth Fund that allows for more innovative and emerging investments, and a Digital Currency Investment Pilot Program could be a perfect fit, offering potential benefits we cannot afford to overlook,” Patronis wrote.
Massive Budget Issues
The proposal comes amid nation-wide discussions on crypto, including President Trump’s idea for a national crypto stockpile and Governor DeSantis’ initiatives against central banks and digital currencies.
Former US President Donald Trump, during his speech at the Bitcoin 2024 conference in July, proposed creating a national Bitcoin stockpile. This would position Bitcoin as a strategic asset for the U.S., similar to how gold is treated in national reserves.
Trump also stated that if elected, his administration would retain all Bitcoin currently held by the U.S. government and acquire more in the future.
Patronis called for the SBA to conduct a feasibility study to assess the potential risks and rewards of Bitcoin and crypto investments. The findings are expected to be presented to the Board of Trustees before the next legislative session.
If approved, Florida could become a pioneer in state-level cryptocurrency investments, joining Wisconsin and Michigan in allocating portions of their pension funds to crypto. Other states like Arizona and Wyoming have also stepped up to advance legislative efforts to support crypto banking.
USD Hedge
Earlier in May, the State of Wisconsin Investment Board (SWIB) disclosed that it invested approximately $164 million in spot Bitcoin ETFs, holding shares in BlackRock’s iShares Bitcoin Trust and Grayscale’s Bitcoin Trust. The allocation to Bitcoin ETFs represents about 0.1% of its total assets under management.
Following SWIB, in July, the State of Michigan Retirement System reported holding 110,000 shares of ARK 21Shares’ Bitcoin ETF, worth around $6.6 million.
These latest developments are part of a growing trend among institutional investors to add cryptocurrency to their portfolios through Bitcoin ETFs. Experts suggest that spot ETFs make it easier for institutions like pension funds and insurance companies to invest in crypto without directly holding the underlying assets.
Previously, Matthew McDermott, the Global Head of Digital Assets at Goldman Sachs, had predicted that the approval of spot Bitcoin and Ethereum ETFs could unlock “the universe of pensions and insurers.”
According to McDermott, these ETF newcomers could boost institutional investment in the crypto market, leading to increased liquidity, price stability, and overall growth of the industry.
Demand for US Bitcoin ETFs has grown dramatically since their launch in January, showcasing increased acceptance and interest in digital assets within traditional finance.
According to data from Farside Investors, US spot Bitcoin ETFs have attracted around $1.3 billion so far this week, with Monday’s inflows topping $479 million and yesterday’s gains of $870 million.
If this pace of accumulation continues, US Bitcoin ETFs will soon surpass Satoshi Nakamoto’s Bitcoin holdings, according to Eric Balchunas, a senior ETF analyst at Bloomberg. Satoshi’s estimated holdings are approximately 1.1 million BTC.
Stay Ahead of the Market with Benzinga Pro!
Want to trade like a pro? Benzinga Pro gives you the edge you need in today's fast-paced markets. Get real-time news, exclusive insights, and powerful tools trusted by professional traders:
- Breaking market-moving stories before they hit mainstream media
- Live audio squawk for hands-free market updates
- Advanced stock scanner to spot promising trades
- Expert trade ideas and on-demand support