According to NZ Funds Management, a New Zealand hedge fund that had assets of $ 350 million under management at the end of December 2020, five percent of its money is invested in Bitcoin. Bitcoin will also be used in other Kiwisaver investment programs over the next five years, according to the company’s CIO, James Grigor.
“You Can’t Discount Bitcoin”
As explained in a local report, the company’s Bitcoin acquisition did not become possible until October 2020 when a change was made to the bidding documents. To justify the takeover, Grigor said:
Bitcoin had become a commodity, with many of gold’s attractive trademarks that investors often bought as a store of value during the economic crisis.
In recent years, BTC has cemented its reputation as an alternative store of value. Many supporters and opponents (including Federal Reserve Chairman Jerome Powell) see Bitcoin as the digital form of gold. This is possibly an attribute of the crypto asset that prompted Grigor’s company to allocate funds for it, as he explains:
If you enjoy investing in gold, then you can’t really discount Bitcoin.
Bitcoin speculative asset
However, some of NZ Funds Management’s competitors have attacked this decision, calling it “more gambling than investing”. Others say Bitcoin has no place in their portfolios because the crypto is “too speculative at this point”.
In his response to this criticism, Grigor argues that the Kiwisaver fund is built “mostly through traditional asset classes” such as bonds and stocks. However, Grigor explains that “there will be times when it won’t always be easy sailing.” To prepare for this opportunity, the CIO suggests that it is advisable to invest in other opportunities as they arise.
Meanwhile, Grigor also announces that after acquiring the crypto asset for $ 10,000 in October 2020, BTC has risen to over $ 61,000. Although the crypto asset has since pulled back from its highs, NZ Funds Management believes that Bitcoin price “will continue its upward trend”. However, Grigor adds that “if we think the momentum has subsided, we will move on to the next asset class”.
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