- Grayscale CEO Michael Sonnenshein noted that pension funds are in talks to incorporate Bitcoin as an asset class to diversify investments.
- Despite the fall of the digital asset, investors look to the long term and trust that the value of Bitcoin is well above the price it has at the moment.
- The main cause that is holding back pension funds today is the few or no regulations that exist within the ecosystem of digital assets.
The big media such as the radio, television channels, Internet portals and newspapers are talking about Bitcoin and not about the advantages or decentralization of the network, but about its abrupt fall that placed it after months below the $25,000 dollars. Digital gold is back in trend.
Nevertheless, The fall that the main cryptocurrency in the market is suffering along with the rest of the altcoins does not seem to be a reason for the general public to lose interest in digital assets.according to Grayscale CEO Michael Sonnenshein.
Pension funds see Bitcoin for the long term
Sonnenshein, key piece in the leader in investment in digital currencies, considered that pension funds are in talks to incorporate Bitcoin as an asset class to diversify investments. Why don’t you care about the present moment? They look at the long term and are confident that the value of Bitcoin is well above its current price.
The main cause that is holding back pension funds today is the few or no regulations that exist within the ecosystem of digital assets.
“We are spending time with politicians, and some of the biggest pensions and endowments are focused on diversifying their portfolios and actively exploring crypto allocations. It’s a different kind of consensus”, expressed Sonnenshein in an interview with CNBC.
Bitcoin, in the crosshairs of pension funds
The statements of the CEO of Grayscale are consistent with the movements of some managers of 401(k) retirement plans, which have been willing to offer investments in cryptocurrencies for riskier investors. Some have even started this process with very good adoption.
Since May, Fidelity Investments, which is the largest provider of retirement plans in the United States, allows its clients to put up to 20% of their funds in BTC. ForUsAll, another of the leaders in the sector, coConsider the option of accepting that 5% be cryptocurrencies.
Department of Labor raises alerts
These new options put the Joe Biden administration on alert, which has never been very willing to incorporate digital assets as a currency. The fear of losing the dominance of the US dollar is as big as the cryptocurrency market.
“The United States Department of Labor (DOL) published a regulatory compliance assistance document reminding pension plan providers that crypto assets do not meet the standards of prudent financial investments.highlighted the site CryptoSlate.
This organization warned that thedigital assets pose great risks and could affect the retirement funds of the participants who get involved”. Although this does not imply a prohibition, it is clear that it seeks to instill fear to prevent BTC from becoming a good option when it comes to pensions.
While Senators Elizabeth Warren and Tina Smith wrote a letter to Fidelity about their decision and the investment fund hit back hard at the Department of Labor’s claims, calling for them to focus on “providing guidance to trustees” rather than “providing armchair opinions” regarding the cons of digital assets.
ForUSAll, for its part, went further by suing the DOL and demanding that a court of law not allow the Department to limit the rights and thoughts of investors. Long-term investors have many options available to them, and cryptocurrencies could be a good alternative for safe retirement funds.
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