Wisconsin Sells All Grayscale Bitcoin Trust (GBTC) Shares, Invests Heavily in BlackRock Bitcoin ETF
The public pension fund of Wisconsin has made a significant move in its cryptocurrency investment strategy by selling all of its shares in the Grayscale Bitcoin Trust (GBTC). According to a new SEC filing, the State of Wisconsin Investment Board (SWIB) fully liquidated its GBTC holdings, which amounted to 1,013,000 shares as of May, valued at over $63 million in the last quarter.
Despite divesting from GBTC, Wisconsin's pension fund remains committed to Bitcoin as part of its retirement investment portfolio. In a strategic pivot, SWIB acquired 447,651 new shares of BlackRock's iShares Bitcoin Trust, boosting its total holdings to 2,898,051 shares valued at $98.9 million by the end of the quarter, as reported by MacroScope on X.
The decision to exit GBTC and increase investments in BlackRock's Bitcoin ETF highlights a broader trend among institutional investors. One of the primary reasons for the shift is the comparatively high fees associated with GBTC, which charges 1.5% in management fees. Since the launch of Bitcoin ETFs in January, Grayscale's once-dominant product has seen outflows of over 386,000 BTC, equivalent to about $22.3 billion.
Due to the sale of GBTC shares and the decline in Bitcoin's price, Wisconsin's overall Bitcoin exposure in USD terms dropped by approximately 39% by the end of the quarter. However, the state's continued investment in Bitcoin ETFs suggests confidence in the long-term potential of Bitcoin as part of its pension strategy.
David Krause, a finance professor at Marquette University, recently commented that this move is likely just the beginning. If the pension fund decides to allocate even 1-2% of its portfolio to Bitcoin ETFs, it could result in additional purchases of up to $3 billion in Bitcoin index funds.
This strategic reallocation from GBTC to BlackRock's Bitcoin ETF by Wisconsin could influence other institutional investors to follow suit, especially given the evolving landscape of Bitcoin investment products.