South Korean Pension Fund Prepares to Invest in Crypto ETF

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The Pension Fund for Researchers and Educators in South Korea decided to invest part of the capital in ETFs on Bitcoin futures. This is the first time a Korean pension fund invests in the cryptocurrency industry.

The Korean Faculty and Staff Mutual Aid Association Foundation plans to start
invest in the first half of 2022: to the local cryptocurrency ETF, if one is launched, or to a similar instrument on a foreign platform. The investment will be determined by the Association’s Investment Review Committee. The fund made the decision on the basis of its own research, which showed that cryptocurrencies are gradually becoming a major investment asset in the world.

An additional impetus for the decision was the recent launch of the Bitcoin futures ETF in the United States. This factor gave legitimacy to the asset and turned it into a transparent product. Earlier attempts by fund managers in South Korea to make such investments have been thwarted by negative perceptions of cryptocurrencies by the country’s financial regulators. This step of the Association can create a network effect for similar funds as well as for asset managers.

“All this time, pension funds with a pronounced public character had no choice but to observe the general craze for cryptocurrencies.”

It is noteworthy that the decision of the Association was adopted against the backdrop of toughening legislation on the regulation of cryptocurrencies in South Korea. The Faculty and Staff Mutual Aid Association administers funds to which faculty and staff regularly pay during their tenure.

If for South Korea this is the first case of a social fund investing in cryptocurrencies, then in the United States last month two pension funds from Virginia submitted applications to the regulator for approval of investments in a cryptocurrency fund. Analyst firm Pureprofile reported last month that 45 of the 50 pension funds and insurance companies in the UK and the US with a combined capital of more than $ 80 billion are planning to invest in cryptocurrencies in the next five years.

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