A Tipping Point for Australia’s $2.4 Trillion Pension Fund Industry? First Super Fund Gives Crypto A Go-Ahead
Amidst the concern among Australia's pension fund industry regarding investing in crypto, Rest Super has become the first Australian superannuation fund to signal interest in exposing member portfolios to the asset class.
Rest Super’s CIO Andrew Lill gave crypto the go-ahead at the fund’s annual general meeting on Tuesday evening, telling members that a small portion of their funds will soon be invested in crypto assets.
“It’s still a very volatile investment, so any allocation exposure we make to cryptocurrencies is likely to be part of our diversified portfolio as initially a fairly small allocation that may, over time, build.”
“We see it as a very interesting and important part of our portfolio going forward into the future.”
The fund managing $66 billion said while it isn't committing an investment in the immediate future, they are “certainly” considering medium-term exposure and are currently “conducting extensive research” into the nascent asset class before making any decisions.
“We are also considering the security and regulatory aspects of investing in this class.”
As we reported, Australia’s $2.4 trillion pension fund industry has been wary of adopting cryptocurrencies.
Ross Barry, who oversees A$27 billion at superannuation fund Spirit Super had called crypto “too risky to be considered for institutional portfolios” but said it would be “remiss” of them not to keep an eye on its potential.
“We don’t see cryptocurrency as investable for our members,” came from Paul Schroder, CEO of AustralianSuper, the country’s largest pension fund with A$244 billion AUM but added that there is interest in DeFi.
Lasanka Perera, COO at crypto exchange Independent Reserve, told Business Insider Australia that most fund managers — mid-market companies and family offices — are already exposed personally.
But as the much larger companies and funds materially invest in crypto for generating yields and capital gains, it could trigger a wave of institutional crypto investment despite resistance from major investors, said Perera.
“There is huge resistance, but I think it’ll happen sooner rather than later,” he said. “So, it might seem to us like it may take five or 10 years for super funds to allow their investors to get crypto exposure. But I think if one goes, then all of a sudden you see a few others get into it.”