- A new report finds that US pension plans have increased their allocations to Bitcoin, Ethereum and stablecoins, but have avoided other altcoins.
- Market volatility has led some to question these allocations, with 11 pension funds recently losing more than $250 million after Strategy shares fell.
There has been heated debate in regulatory and investment circles over whether pension funds should include crypto in their portfolios. However, even as the debate continues, a new report reveals that these funds have quietly expanded their exposure as they seek to exceed average market returns.
The report, titled “Investment of U.S. Public Pension and Trust Funds in Digital Assets,” was compiled by the Reason Foundation, a public policy think tank based in Los Angeles. He revealed that interest in crypto is growing rapidly among pension funds, with some already investing in these assets while others are exploring their options.
Some funds have purchased crypto directly, although this remains a minority. Most have opted for regulated routes, with exchange-traded funds (ETFs) and buying shares of companies with heavy crypto exposure, such as Michael Saylor’s strategy, among the main routes. Collectively, pension funds have invested around $1 billion in crypto and related assets, according to Reason.
Examine key policy considerations and create a framework for public retirement system investment in Bitcoin and other cryptocurrencies.
– Reason Foundation (@ReasonFdn) February 11, 2026
Dozens of other economies beyond the United States are also seeing growing interest in crypto from pension funds. Last year, Coinbase and OKX launched new products targeting superannuation funds in Australia, a sector worth $2.3 trillion. A report from Bitget Exchange found that this interest is highest with Gen Z and Alpha at 20%, as we reported last month.
The era of Bitcoin pensions
As Reason points out, pension funds allocate resources to many different assets for hedging purposes, to benefit from price appreciation, and for diversification. Certain assets like gold fulfill all three, and Bitcoin could be the next asset these funds turn to.
In recent years, crypto has been a mixed bag for pension funds. A report released a week ago revealed that 11 US state pension funds purchased shares of Saylor’s Strategy. Among them, only one was not in the red at the time, with an average loss of 60% for the other 10. Together, they had lost more than $250 million. Among them, the New York State Common Retirement Fund, one of the largest in America with $280 billion in assets under its management, lost $53 million.
This is not the first time pension funds have lost millions to crypto. When the infamous FTX stock market collapsed four years ago, Canada’s Ontario Teachers’ Pension Plan lost nearly $100 million invested in the stock market. The Caisse de dépôt et Placement du Québec, the second largest pension fund in Canada, lost $150 million.
However, many have made hundreds of millions from their crypto investment. The California Public Employees Retirement System ($500 billion in assets under management) invested in Coinbase, which remains the largest crypto exchange in the United States.
These investments will only increase in the future, with President Trump signing an executive order allowing 401(k) pension funds to invest in Bitcoin in August.
“My administration will reduce the regulatory burdens and legal risks that prevent America’s workers’ pension funds from achieving the competitive returns and asset diversification needed for a secure and comfortable retirement,” the pro-crypto Republican president said.
