Investing in DeFi

How investing in DeFi helps increase the capital of pension funds

U.S.-based pension funds are planning investments in DeFi. Organizations from Fairfax, Virginia, are considering cryptocurrency companies that operate in the income farming industry for investment. If the idea is approved, the pension funds would be used for cryptocurrency platforms.
It should be noted that there are already similar examples of investments in the U.S. The pension fund, which manages the assets of Fairfax City police officers, has already invested in cryptocurrencies. In 2019 the organization was one of the first in the country to turn its attention to the DeFi sector. In 2021, the police force was also joined by county civil servants with the intention of investing in the Parataxis fund, which acquires a variety of digital assets and cryptocurrency derivatives.
In addition, the pension funds do business with Morgan Creek as well as Blockchain Capital. Through these companies, the organizations make venture capital investments in DeFi startups, and some of the funds are used to invest directly in cryptocurrencies. The total assets of Fairfax’s police and government employee pension funds are about $7 billion.
Investments in the cryptocurrency market are gaining popularity not only in the U.S. At the end of last year, the director of the Rest Super pension fund in Australia announced plans to invest a percentage of the funds in DeFi. Thus, the organization became the first in the country to entrust its money to the cryptocurrency sector.

Investing in DeFi: the example of U.S.The head of Rest Super notes that digital assets should still be seen as volatile instruments, which means that they should be handled with caution. Therefore, the fund invests a small amount, which in case of changes in the cryptocurrency market will avoid serious losses. However, the businessman is determined to dilute the organization’s investment portfolio with this type of asset. If the work with digital assets becomes successful for Rest Super, the volume of investments will be increased.
It should be noted that private pension insurance is mandatory in most developed countries. People regularly contribute part of their income to special organizations, which, through various investment options, increase the initial amount.
As for the Rest Super pension fund, it manages more than $47 billion, but there is no official information yet on what proportion of the amount has been allocated to cryptocurrencies. According to the fund’s director, investing in DeFi is a good decision, especially at a time of rising inflation, which is observed in the global market in general, and in Australia as well.
Experts note that previously the pension fund sector was rather skeptical about cryptocurrency. However, the example of various organizations shows that their attitude is changing, and DeFi is becoming an increasingly promising option for capital accumulation.