The Government Pension Investment Fund (GPIF) of Japan announced on Tuesday its intention to gather information regarding the diversification into illiquid assets such as Bitcoin, gold, forests, and farmland.
In a bid to refine its core investment portfolio with a focus on long-term sustainability and adaptability to major economic and social shifts, GPIF outlined plans to conduct research aligned with its Fiscal Year 2023 objectives. Seeking input on various investment aspects, the fund clarified that it would not offer compensation for any information provided, according to a Japanese translation of the announcement.
While actively pursuing information, GPIF acknowledged the prevailing uncertainty surrounding the potential expansion into new investments.
GPIF Aims for Long-Term Investment Returns to Support Pension Benefits
Currently managing a diverse portfolio spanning both domestic and international markets, GPIF’s investments include stocks, bonds, and various government bonds. The fund also incorporates environmental, social, and governance (ESG) considerations into its strategy to bolster long-term returns. With assets totaling approximately $1.5 trillion, GPIF stands as the world’s largest pension fund.
The primary objective of GPIF remains to generate investment returns over the long term to sustain public pension benefits while simultaneously minimizing risk to the pension system.
Pension Funds’ Interest in Cryptocurrency
Interest from pension funds in the cryptocurrency space continues to grow. Notably, South Korea’s National Pension Service made headlines last year with its investment of around 26 billion won ($20 million) in Coinbase stock.
Similarly, the Fairfax County Retirement Systems, a US pension fund managing assets worth $6.8 billion, announced plans to explore crypto lending markets to enhance returns.
Moreover, a survey conducted by the CFA Institute in April 2022 revealed that 94% of state and government pension plan sponsors were involved in crypto investments. Additionally, the survey found that 62% of corporate defined benefit plans were allocating funds to crypto-related investments.