Japan's Government Pension Investment Fund (GPIF), the largest pension fund in the world, has become interested in Bitcoin . It is of particular interest as a potential diversification tool.
On March 19, GPIF officially announced the development of a new long-term investment policy in response to significant changes in the economy and society and rapid technological progress .
The largest pension fund is interested in Bitcoin
In response to the new challenges, GPIF has launched a five-year research plan to explore innovative investment diversification methods with an emphasis on sustainability and risk management.
As part of this plan, GPIF requested data on various potential investment diversification tools , including information on assets that the company considers to be "illiquid" and does not hold. Such assets include cryptocurrencies such as Bitcoin, precious metals and other assets.
However, it is necessary to slow down possible misplaced optimism a little. The new GPIF notice is "only" a request for information. In no way does it guarantee that the firm will expand its operations to include new assets such as Bitcoin in the future. Instead, the company will consider whether to conduct further research in the future based on the data collected.
At the time of writing, the price of BTC is around 63,017 USD according to KMC .
What is GPIF?
GPIF was established in 2006 by the Japanese government and focuses primarily on investments in basic infrastructure funds. That is, those who invest in assets necessary for social and economic activities. Currently, the company is diversifying investments into traditional assets such as domestic and foreign stocks and bonds , as well as alternative assets such as infrastructure and real estate.
In the 2022 annual report, GPIF emphasized that diversification is the company's main investment strategy. The text directly states:
"Our primary investment strategy is diversification by asset class, region and time frame. While market prices may fluctuate in the short-term, GPIF will take full advantage of our long-term investment horizon to achieve investment returns in a more stable and efficient manner…"
The GPIF's total assets under management were ¥225 trillion (US$1.54 trillion) at the end of December 2023. This makes it the largest pension fund in the world.
Conclusion
While the GPIF is just beginning to consider potentially adding Bitcoin to its portfolio, some global pension funds have already embraced Bitcoin-related assets. In November 2023, South Korea's National Pension Service announced the purchase of over 280,000 shares of Coinbase .
