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Michigan’s Pension Fund Allocates $10M To Ethereum ETFs, Exceeding BTC ETF Holdings

On Monday, the State of Michigan revealed substantial investments in cryptocurrency exchange-traded funds (ETFs) for Bitcoin and Ethereum in a 13F filing with the US Securities and Exchange Commission (SEC).

This strategic move marks a significant step for institutional investment in digital assets, as the Michigan Retirement System manages approximately $144 million in pension fund assets for state employees.

Michigan Becomes First State Pension Fund To Invest In Ethereum ETF

The Michigan Retirement System disclosed an investment of over $6.9 million in the ARK/21Shares Bitcoin ETF, equating to around 110,000 shares of the fund. 

Moreover, Michigan has become the first state pension fund to invest in an ETF that holds Ethereum, further diversifying its crypto portfolio. Matthew Sigel, head of digital asset research at VanEck, noted that Michigan has now entered the ranks of the top five holders of Ethereum and the Grayscale Ethereum Trust (ETHE). 

Bloomberg ETF expert Eric Balchunas highlighted the significant investment Michigan has made in Ethereum ETFs, amounting to $10 million, which surpasses its Bitcoin ETF investment. 

In contrast, the state of Wisconsin’s investment board, which manages $156 billion for its retirement system, has previously disclosed holdings in Bitcoin ETFs, including BlackRock’s iShares Bitcoin Trust and the Grayscale Bitcoin Trust. 

These disclosures are part of the quarterly 13F filings, which provide a snapshot of institutional investment strategies approximately 45 days after the end of each quarter.

Spot Bitcoin ETFs Reach Six-Month High

The demand for spot Bitcoin ETFs has surged to a six-month high, signaling strong interest in Bitcoin as an investment vehicle. However, Ethereum ETFs have yet to replicate this success in the US market. 

Despite a strong performance through October, Bitcoin ETFs faced challenges at the beginning of November, with a reported net outflow of $54.9 million on November 1.

Fidelity’s FBTC accounted for nearly half of this outflow, totaling approximately $25.64 million, while ARK & 21Shares’ ARKB experienced a similar drop of $24.13 million. 

Grayscale’s GBTC, traditionally associated with capital outflows, only recorded $5.51 million in outflows, indicating a relative stabilization compared to previous trends.

Interestingly, BlackRock’s iShares Bitcoin Trust (IBIT) did not register any inflow or outflow on November 1, marking a pause after 14 consecutive days of capital influx. Prior to this, IBIT had experienced a significant influx of $872 million on October 30.

Ethereum
The daily chart shows BTC’s price struggling to consolidate above $68,000. Source: BTCUSDT on TradingView.com

At the time of writing, the largest cryptocurrency on the market, Bitcoin, is trading at $67,970, down nearly 2% in 24 hours. Ethereum, on the other hand, is down 3% over the same period, trading at $2,407.

Featured image from DALL-E, chart from TradingView.com 

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