In a groundbreaking move, the State of Michigan has unveiled significant investments in cryptocurrency exchange-traded funds (ETFs) for Bitcoin and Ethereum. This development was disclosed in a 13F filing with the US Securities and Exchange Commission (SEC), marking a pivotal moment for institutional investment in digital assets. The Michigan Retirement System, which oversees approximately $144 million in pension fund assets for state employees, is spearheading this strategic initiative.
Michigan Becomes First State Pension Fund to Invest in Ethereum ETF
The Michigan Retirement System has taken a notable step by investing over $6.9 million in the ARK/21Shares Bitcoin ETF, acquiring approximately 110,000 shares of the fund. Furthermore, Michigan has distinguished itself as the first state pension fund to invest in an ETF that includes Ethereum, thereby diversifying its crypto portfolio. This move positions Michigan among the top five holders of Ethereum and the Grayscale Ethereum Trust (ETHE), as noted by Matthew Sigel, head of digital asset research at VanEck.
Eric Balchunas, a Bloomberg ETF expert, emphasized Michigan’s substantial investment in Ethereum ETFs, amounting to $10 million, which notably exceeds its Bitcoin ETF investment. In comparison, the state of Wisconsin’s investment board, managing $156 billion for its retirement system, has previously revealed holdings in Bitcoin ETFs, including BlackRock’s iShares Bitcoin Trust and the Grayscale Bitcoin Trust. These disclosures are part of the quarterly 13F filings, providing a snapshot of institutional investment strategies approximately 45 days after each quarter ends.
Spot Bitcoin ETFs Reach Six-Month High
The appetite for spot Bitcoin ETFs has surged to a six-month high, indicating robust interest in Bitcoin as a viable investment option. However, Ethereum ETFs have yet to achieve the same level of success in the US market. Despite a strong performance through October, Bitcoin ETFs encountered challenges at the start of November, with a reported net outflow of $54.9 million on November 1.
Fidelity’s FBTC was responsible for nearly half of this outflow, totaling approximately $25.64 million, while ARK & 21Shares’ ARKB experienced a similar decline of $24.13 million. Interestingly, Grayscale’s GBTC, which has historically been linked with capital outflows, recorded only $5.51 million in outflows, indicating a relative stabilization compared to previous patterns.
Remarkably, 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 witnessed a significant inflow of $872 million on October 30.
Current Market Conditions for Bitcoin and Ethereum
As of the time of writing, Bitcoin, the largest cryptocurrency on the market, is trading at $67,970, reflecting a nearly 2% decline over the past 24 hours. Meanwhile, Ethereum has experienced a 3% drop in the same timeframe, currently trading at $2,407. These fluctuations underscore the dynamic nature of the cryptocurrency market and highlight the importance of strategic investment decisions.
