Florida is evaluating the possibility of including Bitcoin in state pension funds to diversify investments and protect against market volatility.
The Chief Financial Officer of Florida, Jimmy Patronis, has proposed the idea of considering Bitcoin as a diversification asset for public pension funds. In a communication addressed to Chris Spencer, executive director of the Florida State Board of Administration (SBA), Patronis suggested evaluating the opportunity to invest a portion of state pension funds in Bitcoin.
Pilot program proposal
Patronis proposed the introduction of a “Digital Currency Investment Pilot Program” under the Florida Growth Fund. The program would allow investment of up to 1.5% of the Florida Retirement System (FRS) trust fund. Currently, the SBA manages over 30 funds, including the FRS, which held assets worth approximately $205 billion as of September 30.
Patronis emphasized that Bitcoin could serve as a protective hedge against volatility seen in other asset classes. The proposal aligns with Governor Ron DeSantis‘s efforts, who has opposed the adoption of CBDCs.
Feasibility report
In the letter, Patronis urged the SBA to prepare a comprehensive report on the feasibility, risks, and potential benefits of allocating a portion of pension funds to digital assets. The report must be completed by March 4, 2025, ahead of the next state legislative session.
Other States’ approach
If Florida adopts this strategy, it would join other states like Wisconsin and Michigan, which have already introduced similar changes to their pension funds. Last May, the State of Wisconsin Investment Board announced a $163 million investment in Bitcoin ETFs, an allocation of 0.1% of total managed assets. In July, the Michigan State Retirement System revealed holdings of 110,000 shares in ARK 21Shares ETF, equivalent to 0.003% of total managed assets.
