The New Zealand-based NZ Funds Management-run KiwiSaver pension fund has sunk about 5% of its USD 245m holdings into bitcoin (BTC), claiming that the token will feature in more KiwiSaver plans in the future.
The KiwiSaver program is government-endorsed, and both individuals and companies can contribute to it but a number of competing providers offer differentiated products, or growth funds. Some 270 such funds currently exist.
Per a report from Stuff, NZ Funds Management began allowing crypto investments in October last year.
The firm’s chief investment officer James Grigor was quoted as stating that BTC is “a commodity” that has experience “legitimization,” adding,
“If you are happy to invest in gold, you can’t really discount bitcoin. […] You may still have a positive view of those asset classes, but other opportunities present themselves.”
And New Zealander Willy Woo, a prominent BTC analyst, suggested that the development might be a sign of greater adoption, writing,
“3%-10% of Kiwi salary and wage income deploys into KiwiSaver, they have the option to pick the growth fund which is exposed to BTC. Hint hint.”
But Stuff indicated that the NZ Funds Management move may be a one-off – at least for now.
The media outlet quoted rival provider Booster as stating that BTC “doesn’t demonstrate risk-return properties that are acceptable from our point of view. […] It’s too speculative at this stage.”
The CEO of Simplicity went a step further, saying that he thinks that “bitcoin within KiwiSaver is tantamount to gambling, not investing. I’m surprised any KiwiSaver manager would consider it a legitimate asset class.”
And Pathfinder, which offers low-carbon funds claimed that BTC’s carbon footprint was a concern for many funds, who are now looking to prioritize sustainability, with the firm’s Paul Brownsey calling the token’s store-of-value credentials “overstated,” and adding that “Bitcoin mining uses about as much electricity as Argentina.”
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