Pension Funds Warming Up with Cryptocurrencies by Partnering with Coinbase

June 16, 2021
Pension Funds Warming Up with Cryptocurrencies by Partnering with Coinbase

ForUsAll, a US-based retirement plan provider, has joined forces with cryptocurrency exchange Coinbase to allow its clients to invest up to 5% of their portfolio assets in cryptocurrencies. This pension provider is well known for providing services mainly to small-to-medium-sized businesses. Reports say that ForUsAll pension fund is currently working with Coinbase to offer its clients a product named Alt 401(k) and provide exposure to over 50 cryptocurrencies. 

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David Ramirez, the co-founder and chief investment officer of the firm, has acknowledged that there are concerns regarding the volatility of crypto-assets and their effect on pension portfolios. However, he made it clear that the US citizens will be at a disadvantage if they’re not given the option to access digital assets in their retirement plans. He said:

“The average American may be at a structural disadvantage relative to large institutions and high net worth individuals, and we just don’t think that’s right.”

ForUsAll retirement fund reportedly handles around US$1.7 billion in retirement plan assets, which is a very small portion of the entire retirement account market of US$22 trillion. 

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However, larger institutional investment firms like Fidelity Investments and Charles Schwab don’t allow their customers in taxable accounts or individual retirement accounts to trade cryptos directly. They allow these clients to buy shares in trusts that invest in cryptocurrency assets from companies like Grayscale Investments.

There is one firm that allows its clients to buy cryptocurrency assets as well as gold for retirement plans and that company is Bitcoin IRA. It was founded in 2016. Chris Kline, the co-founder and chief operating officer at BitcoinIRA, said while commenting on the collaboration of ForUsAll with Coinbase:

“ForUsAll and Coinbase wouldn’t be doing this if there wasn’t a market. There are people that want this with these types of funds. And they want to have access to new and exciting things with their 401(k)s.”

MicroStrategy CEO Michael Saylor also responded to the partnership between ForUsAll and Coinbase by saying:

“If you invest 5% of your portfolio in #bitcoin, you have made the decision to invest 95% of your portfolio in assets getting demonetized by bitcoin.”

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