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Fact Check: Do US Public Pensions Invest in Cryptocurrency?

By Hank Kim, Executive Director and Counsel for NCPERS

Edward Siedle's claim that your US state pension is gambling away a portion of your hard-earned retirement savings on cryptocurrency is simply unfounded.

Check the Facts Next Time, Edward Siedle

In his recent Forbes column, Edward Siedle cited a study claiming that 94 percent of America's state and local government pensions are gambling on cryptocurrencies and—in the very same sentence—derided them as the ‘dumbest institutional investors in the world.'

In his haste to further his agenda, however, he seemingly only glanced at a headline and chose to overlook the facts (a pattern in his writing, from what I've seen).

The study he's referring to, published by the CFA Institute, is their annual Investor Trust Study. It looks at survey responses from 3,588 retail investors and 976 institutional investors from 15 markets across the globe. Perhaps Siedle didn't make it all the way to page four of the study to see who was surveyed, as it clearly shows that only 151 of those 976 global institutional investors were in the United States.

I'm guessing he also didn't feel the need to look even closer at the available data, where it breaks those demographics down further. Of the 50 state/government pension plans around the world that responded to the survey, only 16 percent were in the US—meaning only 8 US public pension plans are represented in the study.

That's right. Only 8 out of the more than 5,000 US-based public pension plans are part of the figure Siedle references. The study is hardly representative of US public pensions and their investment strategies.

Now I love jumping to conclusions just as much as any lawyer, but Siedle's claim that your US state pension is gambling away a portion of your hard-earned retirement savings on cryptocurrency is simply unfounded.

As policymakers develop regulatory frameworks around digital currencies, perhaps US public pensions will invest as part of their long-term diversification and risk management strategies. Who knows, maybe one day?

But for now, one thing is certain: Edward Siedle's writing demonstrates a clear bias against public pensions with a goal of drumming up fear among public servants and retirees. Why? Because it benefits him and his business as a whistleblower attorney in the investment banking and securities industry.

My recommendation? Take what he says with a grain of salt and check the facts for yourself.
 

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