Wisconsin may soon invest billions in Bitcoin ETFs

The Wisconsin pension fund's Bitcoin ETF purchases were a sensation. Now an expert explains why the BTC position could soon be significantly increased.

David Krause, professor of finance at Marquette University, explains why the pension fund's investment is only a first attempt. Significantly larger sums would soon go to Bitcoin ETFs can flow.

The SWIB (State of Wisconsin Investment Board) acquired shares in BlackRock's iShares Bitcoin Trust (IBIT) and the Grayscale Bitcoin Trust (GBTC) in the first quarter, according to a filing with the SEC in May.

In a interview with PBS Wisconsin, David Krause emphasizes that "the Wisconsin Investment Committee has always been innovative. Pension funds in particular do not normally invest in new products such as Bitcoin ETFs.

At the end of 2023, SWIB was managing assets of about US$156 billion. Accordingly, investments in Bitcoin ETFs currently make up only about 0.1 percent of the portfolio.

Krause is optimistic about the future: "I think this is just an entry point. [...] You use it as a test, because it won't affect the portfolio significantly until you get to maybe a positioning of one or two percent."

If the pension fund decides to transfer this part of its portfolio to Bitcoin ETFs, it would mean buying BTC index funds totaling US$3 billion.

Currently, Bitcoin ETF investors are mostly retail investors. However, there are increasing reports that institutional investors are putting large sums of money into BTC funds.