Simply put
- CalPERS candidates have varied opinions on crypto investments, ranging from strong rejection to cautious analysis.
- The fund possesses 410,596 shares valued at $165.9 million, allowing for indirect Bitcoin exposure.
- One candidate indicates a willingness to keep the possibility of crypto investments on the table, while another emphasizes the potential of blockchain technology.
During a recent forum, California’s Pension Fund, CALPERS, showcased mixed reactions from board candidates regarding crypto investments. This discussion, despite CalPERS’s existing shares in the Strategic Bitcoin Finance Company’s fund, revealed a split perspective on whether Bitcoin should be part of their $56 million portfolio.
Six candidates are vying for positions on the California Civil Service Retirement System Management Committee. They expressed differing views on Bitcoin’s inclusion in the fund’s investments.
According to a Q2 13F filing, CalPERS’s 410,596 strategic shares worth $165.9 million give it considerable indirect exposure to Bitcoin through MicroStrategy.
The forum started with some tension when incumbent David Miller criticized challenger Dominic Bay during his introductory remarks, asserting, “cryptocurrency should not be part of our board, and should never be.”
In response, Bay pointed out CalPERS’s holdings in MicroStrategy, the largest Bitcoin holding company, questioning the rationale behind opposing direct Bitcoin investments while holding significant indirect stakes.
MicroStrategy, under Michael Saylor’s leadership, has accumulated over $70 billion in Bitcoin, which is more than 636,505 BTC. Thus, it serves as a way for CalPERS to engage in cryptocurrency without directly purchasing it.
Attempting to clarify this contradiction, Miller argued that investing in a company involved in Bitcoin transactions is quite different from buying Bitcoin directly.
Kadan Stadelmann, the Chief Technology Officer of Komodo Platform, commented that Bitcoin’s volatility isn’t a major issue for pensions, especially considering current inflation. He remarked that the market has acknowledged Bitcoin’s value as a reliable store of wealth.
Stadelmann also noted that CalPERS seems hesitant to invest directly in Bitcoin, emphasizing that the public should own Bitcoin rather than relying on intermediaries.
Challenger Steve Melmell strongly opposed the idea of crypto investment, likening it to previous financial disasters and describing it as “opaque,” asserting that the pension system doesn’t belong in such investments.
On a more cautious note, challenger Troy Johnson admitted his wariness about crypto but refused to completely dismiss the idea of future investments.
Opinions likewise diverged on blockchain technology; incumbent Jose Luis Pacheco dismissed Bitcoin as an investment while calling blockchain a promising new technology.
Contrastingly, other state pension funds have begun increasing their crypto exposure, with Michigan’s state pensions significantly expanding their Bitcoin ETF holdings.
The upcoming election this November will be crucial in determining whether CalPERS continues with its current indirect crypto exposure strategy or reopens discussions about direct investments in digital assets.
