South Korea's largest pension fund recently made a substantial investment in the US crypto exchange Coinbase.
During the third quarter of 2023, the NPS acquired 282,673 shares of Coinbase stock for $20 million.
With Coinbase shares soaring to approximately $96.92 per share, the NPS is currently profiting from its investment.
The NPS' decision to invest in Coinbase underscores the increasing acceptance of crypto among governmental and institutional investors.
This move by the NPS follows Virginia's investment of around $35 million in VanEck's New Finance Income Fund back in 2019, making it clear that pension funds are gradually embracing crypto investments.
A noticeable trend has emerged, especially within Asian countries, regarding the adoption and investment in cryptocurrency.
Recent reports highlight South Korea's latest move, as the country has significantly invested in a major US-based crypto company.
Here's a breakdown of the details:
South Korea's Investment in Coinbase Surpasses $5 Million According to recent information, the National Pension Service (NPS), South Korea's largest pension fund, has made a substantial investment in the US market.
In the third quarter of 2023, the Korean NPS allocated $20 million to purchase 282,673 shares of Coinbase, as disclosed in their filing with the US SEC.
Positive Returns on Investment for South Korea The NPS entered the market at approximately $70 per share and is currently experiencing around a 40% profit, with Coinbase shares rallying to about $96.92 per share at the time of writing.
This valuation places the NPS’ investment at over $25 million.
Crypto-Friendly Regulations in South Korea With assets exceeding $800 billion, the NPS stands as the third-largest pension fund globally.
Managing the retirement savings of millions of South Koreans, the recent investment in Coinbase signals the increasing acceptance of crypto among governmental and institutional investors.
This move by the NPS isn’t unique, as other pension funds have also ventured into the crypto space.
In 2019, Virginia invested around $35 million in VanEck’s New Finance Income Fund, which encompassed crypto-related companies such as Coinbase, Bakkt, and ErisX.
However, a setback hit the Fairfax County pension funds when one of their investments, Genesis, filed for bankruptcy in October 2023, triggering a wave of asset liquidation.
The Growing Global Trend of Crypto Adoption Despite the associated risks, institutional investors such as pension funds, hedge funds, and endowments continue to be drawn to the crypto industry.
A survey conducted by Fidelity Digital Assets revealed that 36% of institutional investors in the US and Europe own crypto or derivatives.
The survey also indicated that 80% of investors are attracted to crypto due to factors such as high potential returns, low correlation to other assets, and its innovative technology.
The NPS’s investment in Coinbase mirrors the expanding trend of institutional involvement in crypto. South Korea, alongside other Asian nations, is leading the way in embracing the crypto sector.
As more institutional investors enter the crypto space, the industry is poised to mature and expand further.
Disclaimer: While Voice of Crypto aims to provide accurate and current information, it cannot be held responsible for any missing facts or inaccuracies. Cryptocurrencies are highly volatile financial assets; therefore, it is advisable to conduct thorough research and make informed financial decisions.