September 30, 2022

Public Pension Funds In Virginia Keen on Getting More Direct Exposure to Cryptocurrencies

2 min read

The strong performance of digital possessions this year has brought in the attention of numerous traditional funds in the market. News in the town is that several public pension funds in Virginia are seeking more direct exposure to cryptocurrencies.

The Fairfax County Police Officers Retirement System and Fairfax County Employees’ Retirement System are apparently preparing a $50 million investment in Parataxis Capital Management LLC’s primary fund, which purchases numerous cryptocurrencies and digital possessions derivatives. Obviously, this will undergo board approval.s

The 2 Fairfax Fund together manage a total of $7.15 billion in net assets under management (AUM). Speaking with Bloomberg, Katherine Molnar, primary financial investment officer for the police officers retirement fund, stated:

“We believe that there’s going to continue to be volatility in crypto, and this is going to benefit worth traders. It’s an area that’s going to grow in adoption and interest. We think that it’s inefficient enough, so we believe there are some alpha chances to benefit from.”

Previously, these Fairfax funds have actually made financial investments in Morgan Creek Asset Management funds and also crypto endeavor companies like Blockchain Capital. A bulk of their investments went to start-ups running in this space. Fairfax describes them as equity capital financial investments.

Since the Parataxis fund concentrates on real cryptocurrencies, this provides Fairfax more direct exposure to digital assets.

Betting on the Crypto Market Volatility

The crypto market volatility has helped provide outsized returns often to the financiers. As an outcome, Fairfax has actually been also expanding its investments in the crypto space. For e.g. Molnar had actually planned 2% crypto exposure for the $1.95 billion policemans’ retirement fund.

By the end of June, crypto represented 7% of the assets due to their strong cost gratitude. Thus, crypto “was not an unimportant factor to efficiency” in Q2, said Molnar.

However Molnar stated that they are still not ready to straight purchase crypto coins from the marketplace. “Three years ago we weren’t comfortable making a bet on which cryptocurrency will increase to the top,” she stated. “And I am not exactly sure we are comfy yet doing that today.”

Begun 2 years back in 2019, Parataxis now has $55 million in AUM. The two Parataxis funds invest from Bitcoin to derivatives and even DeFi tokens like MakerDAO. Edward Chin, who started the Parataxis fund stated:

“This is our first pension fund. We are in discussions with a couple more, and a couple of endowments too. It’s clear that individuals are trying to get exposure”.

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