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Other US states will follow Wisconsin by investing in BTC Spot ETFs
- Financial expert David Krause applauded Wisconsin’s bold move to invest in Bitcoin and says a wave of US states will soon invest in the leading cryptocurrency.
- Although Wisconsin has only invested $180 million, Krause believes this is a test run and that the state will continue to pour more money into Bitcoin ETFs.
Three weeks ago, the State of Wisconsin Investment Board (SWIB) became the first in the United States to invest in Bitcoin through the Grayscale and BlackRock ETFs, as Crypto News Flash reported. According to a financial expert from one of the local universities, this is the first of several investments in the cryptocurrency and will inspire other state funds to pour billions into Bitcoin ETFs.
In a recent interview, David Krause delved into the investments that shook the world of cryptocurrencies. Krause is a professor emeritus at Marquette University in Milwaukee and founded the institution’s AIM program.
Speaking to PBS Wisconsin, he claimed that the Wisconsin fund’s investment in Bitcoin shocked the industry. Most people “expected that it would be several years before there was institutional involvement in Bitcoin investing.”
While Wisconsin was the most surprising, Krause says it was best positioned to invest in BTC because it has a fully funded pension fund.
So, in a sense, they have the luxury of being able to invest for the long term. They don’t have to worry about liquidity as much as, say, the Illinois state pension fund, which is only funded at 50% of its level.
he told the media.
Soon after the fund revealed it had invested in BTC, mainstream finance criticized the decision, targeting BTC’s volatility. However, as the finance professor noted, most assets are volatile, including some stocks. For example, California biopharmaceutical company Janux Therapeutics, whose market capitalization is $2.85 billion, has gained 412% year to date. BTC, on the other hand, has gained only 63% in that period.
Krause added:
Bitcoin has moved a lot, but supply and demand are starting to balance. And I think the investment community is starting to understand this more and more as a viable alternative investment.
Bitcoin trades at $69,000, losing less than 1% over the past day as most of the cryptocurrency market has entered a consolidation phase.
Expert: More states invest in Bitcoin
Although Wisconsin was the first, Krause believes other states will join and invest in Bitcoin. However, initially, it will be limited to states with well-funded pension funds like Wisconsin’s.
The Wisconsin fund manages approximately $156 billion, which equates its BTC investment to a negligible 0.1% of its portfolio.
Krause noted:
I think it’s just an entry point. I think they’re testing to see the public’s reaction to whether or not they resist owning it. And they’re using that as evidence because it’s really not going to have a substantial impact on the portfolio until you get to a 1% or 2% positioning.