New Jersey Pension Invested $7M in Bitcoin Mining

[Leviathan.007]

The New Jersey State Pension Fund invested several million dollars in two large companies in the area, seeing the upward trend of cryptocurrency companies in the previous quarter.
The pension fund's capital management sector ended in June with an investment of $ 3.66 million in two blockchain companies (NASDAQ: RIOT) and a $ 3.39 million digital marathon holding (NASDAQ: MARA).
The New Jersey Joint Pension Fund has invested a total of $ 30 billion in the future of the state's employees.
This seems to be the first time this cryptocurrency allocation has been made by the organization in New Jersey. Other government pension funds, especially in California, have been considering investing in shares of bitcoin mining companies in recent months.
New Jersey Investment Division delayed responding to comment.


Source: https://www.coindesk.com/new-jersey-pension-invested-7m-in-bitcoin-mining-stocks-last-quarter

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[Kittygalore]

Well, that's a really risky investment considering that bitcoin is a volatile investment especially using pension as a capital for the investment. I hope that the investment will be fruitful though and I think it will bear big profit because it might need some time.

[defi-Dany]

I think more and more institutions will invest in cryptocurrencies.
 As well-known investment institutions and listed companies choose to invest in Bitcoin, it will be normal for government agencies to join in.

[The Sceptical Chymist]

Well, that's a really risky investment considering that bitcoin is a volatile investment especially using pension as a capital for the investment.

This is a shitpost that I'm replying to, but you're right that it's risky.  However, I just took a look at the stocks in question (RIOT and MARA), and it looks like they've been performing pretty well since their inception.  And I thank OP for linking to the article and mentioning those stocks in his post, because I had no idea those two companies even existed and put them on my watchlist.  Investing in either one of them would be a great way to get some "mining exposure" without actually having to invest, run, and maintain all the equipment necessary to mine bitcoin yourself.

Looks like Marathon Digital Holdings is out of Las Vegas, NV but mines in North Dakota--smart, because I can only imagine how much cooling they'd need if the mining was being done in Las Vegas.  North Dakota, on the other hand, is known for its frigid temperatures. 

I have to say, I'm also kind of surprised that a pension fund would buy stocks like these, but if they're administering 401k's (and I don't know that they are), some participants may want high risk/high return investments.  In any case, this is pretty cool!

[jaysabi]

Well, that's a really risky investment considering that bitcoin is a volatile investment especially using pension as a capital for the investment.

This is a shitpost that I'm replying to, but you're right that it's risky.  However, I just took a look at the stocks in question (RIOT and MARA), and it looks like they've been performing pretty well since their inception.  And I thank OP for linking to the article and mentioning those stocks in his post, because I had no idea those two companies even existed and put them on my watchlist.  Investing in either one of them would be a great way to get some "mining exposure" without actually having to invest, run, and maintain all the equipment necessary to mine bitcoin yourself.

Looks like Marathon Digital Holdings is out of Las Vegas, NV but mines in North Dakota--smart, because I can only imagine how much cooling they'd need if the mining was being done in Las Vegas.  North Dakota, on the other hand, is known for its frigid temperatures. 

I have to say, I'm also kind of surprised that a pension fund would buy stocks like these, but if they're administering 401k's (and I don't know that they are), some participants may want high risk/high return investments.  In any case, this is pretty cool!

A pension fund doesn't invest in or administer 401Ks.  Pension funds are a different type of retirement account where the employer is responsible for funding and investing the assets for the purpose of paying out of the pool when employees retire.  401Ks are individual retirement plans that only apply to a single person.

I have never trusted RIOT since it basically abandoned it's previous business venture to become a bitcoin company.  The company used to be known as Bioptix.  It's a huge red flag when a company does a complete 180 and starts a completely new business that had nothing to do with it's previous business.  I guess it has fairly stable operations now, but I've never gotten over the initial distrust.

[so98nn]

[...]

[...]

[...]  401Ks are individual retirement plans that only apply to a single person.

I have never trusted RIOT since it basically abandoned it's previous business venture to become a bitcoin company.  The company used to be known as Bioptix.  It's a huge red flag when a company does a complete 180 and starts a completely new business that had nothing to do with it's previous business.  I guess it has fairly stable operations now, but I've never gotten over the initial distrust.

That's funny though how state is investing the money of pension fund which they will need to return with composite amount and total corpus amount to the pension holders. This is really really bad idea if you look at it in accordance with the future prospects. What would happen if suddenly Bitcoin collapses? Are not they are afraid of loosing all those funds in a blink of an eye. I know that BTC holds promising path ahead but that's just belief not assurance.

Whenever Government is using the public money for the stuff like above rather than public sector developments then they are gambling it! 

Or, there is another possibility of this one. They might be in the plans of supporting bitcoin because they themselves in the adoption phase in future. May be they know as one of the country from USA, they have bigger plans for crypto world and don't wanna miss the chance to invest today.

[Fortify]

The New Jersey State Pension Fund invested several million dollars in two large companies in the area, seeing the upward trend of cryptocurrency companies in the previous quarter.
The pension fund's capital management sector ended in June with an investment of $ 3.66 million in two blockchain companies (NASDAQ: RIOT) and a $ 3.39 million digital marathon holding (NASDAQ: MARA).
The New Jersey Joint Pension Fund has invested a total of $ 30 billion in the future of the state's employees.
This seems to be the first time this cryptocurrency allocation has been made by the organization in New Jersey. Other government pension funds, especially in California, have been considering investing in shares of bitcoin mining companies in recent months.
New Jersey Investment Division delayed responding to comment.


Source: https://www.coindesk.com/new-jersey-pension-invested-7m-in-bitcoin-mining-stocks-last-quarter

While the people who get into the job of fund manager for such a larger investment institution are generally quite clever, they will often times fall victim to popularity trends just like anyone else and this way they can always cover their back in future by saying they allocated some money to cryptocurrency. It is definitely worth noting that they are investing in profitable companies that have good reason to continue making margins in future - they're probably indirectly invested in Coinbase too after their recent stock market listing. On the whole though, $7 million out of $30 billion invested assets is a tiny amount of their overall assets but a good start I guess.

[ChrisPop]

Well, that's a really risky investment considering that bitcoin is a volatile investment especially using pension as a capital for the investment. I hope that the investment will be fruitful though and I think it will bear big profit because it might need some time.

I wouldn't say it is a risky investment. $7M out of $30bn is only around 0.023% if my arithmetic is still intact. lol
That's quite low in my opinion, but at least it is a start and could produce a snowball effect between pension funds. That's good news anyway. Shout out to New Jersey! 

[Kakmakr]

A responsible fund administrator will only invest a small percentage of the whole Pension Fund into High Risk investments, but nowhere are there mention made of what percentage are invested of the whole fund. If it is say... 2% of the fund, then I will not say it is reckless to do this... but if this is higher than that... then I will be worried as a member of that Pension Fund.

Crypto currencies are a High risk investment and it can give high yields over the long-term or it can completely collapse if it is one of the Pump and Dump Alt coins.  

[Silberman]

Well, that's a really risky investment considering that bitcoin is a volatile investment especially using pension as a capital for the investment. I hope that the investment will be fruitful though and I think it will bear big profit because it might need some time.

7 millions dollars is a fortune for us but for an entity managing the pension funds of people this is not really a lot of money, to me this seems like they are testing the waters and they are trying to become part of this market but they want to do it slowly, there is nothing wrong with that and they have time as I do not expect big movements in this market, however I am surprised as those funds tend to be very conservative on their investments they make so I did not thought possible they will be interested in investing in cryptocurrency related companies.

[WePiggy]

$7m isn't a huge amount but the fact that it comes from a State Pensions Fund is a big deal. It shows that there is trust at institutional and state level for investing in Bitcoin services, also it encourages other Pension Fund investors to do the same, and these guys have really deep pockets!

[CaVO32]

$7m isn't a huge amount but the fact that it comes from a State Pensions Fund is a big deal. It shows that there is trust at institutional and state level for investing in Bitcoin services, also it encourages other Pension Fund investors to do the same, and these guys have really deep pockets!

And it means, they also did their risk assessment here. If they invested in crypto-related business, this means they believe it has high potential to grow. Because if they have hesitation, they won't put this kind of funds to a very volatile market. This move will encourage other related institutions to make a move in this market, which is actually good for crypto community.

[Clavulanic]

$7m isn't a huge amount but the fact that it comes from a State Pensions Fund is a big deal. It shows that there is trust at institutional and state level for investing in Bitcoin services, also it encourages other Pension Fund investors to do the same, and these guys have really deep pockets!

And it means, they also did their risk assessment here. If they invested in crypto-related business, this means they believe it has high potential to grow. Because if they have hesitation, they won't put this kind of funds to a very volatile market. This move will encourage other related institutions to make a move in this market, which is actually good for crypto community.

On that case, these guys is really thinking that $7m worth of mining asset would provide them higher profit. The present risk has been ignored, because of huge expectations everything has been locked up for one vision is to gain sustainable returns. Hopefully, bitcoin services will continue to grow and will become accessible in the whole world regardless of those countries who's still hating cryptocurrency.

[kaya11]

I wouldn't call it a wise move since there have been a decline in prices of cryptocurrencies since the banning of mining farms in China recently. I could only guess that maybe their hardware are used, came from the closed facilities in China and they're grabbing the opportunity of a lifetime getting those machines at a very low price. Still even there are a widely banning issues around the some part of the world the New Jersey folks have guts to invest in. Well some others says it's wise to buy the dip and that includes in the prices of GPU also and other mining hardware. I salute them for being positive thinkers as I couldn't manage to do that.

[zanezane]

I wouldn't call it a wise move since there have been a decline in prices of cryptocurrencies since the banning of mining farms in China recently. I could only guess that maybe their hardware are used, came from the closed facilities in China and they're grabbing the opportunity of a lifetime getting those machines at a very low price. Still even there are a widely banning issues around the some part of the world the New Jersey folks have guts to invest in. Well some others says it's wise to buy the dip and that includes in the prices of GPU also and other mining hardware. I salute them for being positive thinkers as I couldn't manage to do that.

If we look at it long-term, we will be able to see that it won't matter because mining bitcoins can just migrate to another country, it's not like China is the only place you can do mining. Plus it's a pension fund, it's not like they're going to take it out in 1 year let alone 10 years, I think that it will be profitable in the long-term no matter what happens.

[Hydrogen]

Other government pension funds, especially in California, have been considering investing in shares of bitcoin mining companies in recent months.

California's Assembly Votes To Allow Communists To Hold State Jobs

May 9, 2017

California may end a decades-old ban on members of the Communist Party working in its government, after the state Assembly approved a bill that would delete references to the party from its employment requirements.

The bill's sponsor, Assemblyman Rob Bonta, D-Oakland, said that California's laws should focus on individuals' actions and evidence rather than political affiliations and what he termed "empty labels."

Speaking on the floor of the Assembly, Bonta called the legislation a "cleanup bill that removes archaic and outdated references to the Communist Party in our state laws, specifically those stating that a public employee may be dismissed from employment if he or she advocates or is knowingly a member of the Communist Party."

https://www.npr.org/sections/thetwo-way/2017/05/09/527586682/california-assembly-votes-to-allow-communists-to-hold-state-jobs

....


I hope california stays out of bitcoin. I would expect them to pick up, where china left off if they became involved with cryptocurrencies. The US state of california should be blacklisted for crypto mining and crypto ventures. As there is a good probability of them banning exchanges and miners eventually the way china did.

Given california's known issues with rolling electrical blackouts. Rationed electricity. Unreliable spotty internet connectivity. Massive brush fires blazing out of control. Extremely high taxes, rent and cost of living. Unfriendly regulation towards local business owners and emphasis on imposing hard COVID lockdowns on business. With roughly 2/3 residents wanting to migrate out of california to other states. I doubt they will be able to attract much attention from miners given their negative business environment and bad reputation.

Thankfully, many other states might be good for cryptocurrency adoption. And are likely to provide good terms and conditions where crypto sectors might have opportunities to grow.

[Assface16678]

$7m isn't a huge amount but the fact that it comes from a State Pensions Fund is a big deal. It shows that there is trust at institutional and state level for investing in Bitcoin services, also it encourages other Pension Fund investors to do the same, and these guys have really deep pockets!

That depends on the perspective for you it's not a lot but for me, that's actually pretty huge amount given that they are using pension funds plus that money only grows bigger overtime, it's a pension after all so I expect to grow more in several years to come by. I don't necessarily think it's trust in the market that makes this institutional investors go for this kind of thing, it's more of a profit in my opinion.

[mckinleeanael07]

Looks like they saw a vision of BTC in the future, but the sizable investment seems like they are taking a risk and continuing to use the mining that pollutes the environment for us, there needs to be some how to replace BTC mined in this kind of pollution model.

[Gozie51]

Well, that's a really risky investment considering that bitcoin is a volatile investment especially using pension as a capital for the investment. I hope that the investment will be fruitful though and I think it will bear big profit because it might need some time.

The only risk I can associate with such investment is that it is pension money because putting public fund at stake is not ethical but apart from that, it is an apt investment. Bitcoin is worth investing at the moment because institutional investors are beginning to show interest and the latest is Amazon. The more big money enter the circular, the greater the chances of soaring higher.

[Princejebs]

Well, that's a really risky investment considering that bitcoin is a volatile investment especially using pension as a capital for the investment. I hope that the investment will be fruitful though and I think it will bear big profit because it might need some time.

$7m is not a penny mate, that amount is worth billions when you convert it to my local currency. They made choice because they would have made cost evaluation and revenue that can be generated yearly and tax deduction.
Bitcoin mining is profitable and provides high rate of investment that's why many countries with less power source cost involved on them.