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S&P Global Ratings Reports on the Growth of Cryptocurrency in State Reserves and Statewide Pension Plans
Recently, S&P Global Ratings published its report, Cryptocurrency is Growing Within U.S. State Reserves and Statewide Pension Plans. S&P Global reviewed the cryptocurrency (crypto) environment in the 50 U.S. states for both state reserves and statewide pension plans.
The key highlights include:
- Increasingly, U.S. states and statewide pension plans are considering crypto (particularly bitcoin) as a reserve investment.
- To date, 17 states either allow or have introduced legislation regarding using crypto as a reserve asset and 16 are moving toward including crypto investments in statewide pension trusts.
- The recent establishment of crypto exchange-traded funds (ETFs) and the growing regulatory environment may have increased considering crypto as an investment by helping to address related risks.
The report concludes, “Because crypto is a high-risk investment and given that many proposals have defined limits on crypto investments, we do not expect crypto to make up a meaningful portion of state reserves or pension trust assets in a way that might affect credit risk for the state or government entities within the state.”
The report is available here.