One institutional investor, Katherine Molnar, chief funding officer of the $1.9 billion Fairfax County Police Officers Retirement System in northern Virginia, isn’t any stranger to digital belongings.
In 2018, the police fund, together with a sister pension fund, the $5.1 billion Fairfax County Staff’ Retirement System, grew to become the first known public pension funds to commit to a dedicated fund that invests primarily in blockchain technology firms — the Morgan Creek Blockchain Alternatives Fund, managed by Morgan Creek Digital Belongings, a subsidiary of Chapel Hill, N.C.-based Morgan Creek Capital Administration LLC. The workers fund dedicated $10 million and the police fund dedicated $11 million to the Morgan Creek fund in 2018.
Since then, the 2 Fairfax funds have made 5 further digital asset-focused allocations, together with two in current months.
The workers fund invested $32 million in October and the police fund invested $18 million in November to Parataxis Capital, a multistrategy hedge fund centered on the digital belongings sector. The 2 Fairfax funds additionally entered right into a revenue-sharing settlement with Parataxis Capital, although Ms. Molnar declined to supply specifics. “We had been completely happy to speculate as a restricted associate, however then we had been significantly completely happy after we might negotiate a income share with them and be a strategic associate to them,” she stated.
In January, the staff fund dedicated $40 million and the police fund dedicated $20 million to Polychain Ventures III, a enterprise capital fund managed by Polychain Capital centered on digital belongings.
Ms. Molnar stated her pension fund has seen stable returns from the digital belongings up to now and is bullish on its future. “We simply assume that there’s going to be an amazing quantity of progress within the digital asset area so we predict that over time, many belongings, and never simply belongings, however many issues will change into digitized,” Ms. Molnar stated. “So it’s not simply artworks or NFTs, however you’ll be capable of purchase digital or fractional shares of many alternative issues, and it’s not simply equities and bonds and typical monetary belongings, it’ll be something and every part.”
She stated her board will take into account two further digital asset funds at its Might 11 assembly, although she declined to supply specifics forward of time. She stated the pension fund can’t share particular returns from digital asset funds.
Ms. Molnar stated as a result of her pension fund will not be investing immediately in a cryptocurrency akin to bitcoin, it avoids the day-to-day volatility whereas getting publicity to the asset class.