‘It may disrupt our industry’: $2.2 trillion asset manager Pimco delves into crypto
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Fixed-income asset-management firm Pimco is moving further into crypto investing, according to its chief investment officer. Who said institutional FOMO was slowing down? Well at least one big fish did last month.
If you’ve been HODLing Bitcoin and other cryptos for a little while, or even just dabbling now, “you’re early”, according to many in the crypto space. Although, with more and more institutional players – including Pimco – showing interest, perhaps the first-class section of the space ship might be getting a bit crowded very soon.
That said, SkyBridge Capital CEO Anthony Scaramucci did say just last month that he sees little sign of institutional interest despite the retail boom for it growing. He caveated, however, that among the ones who are actually interested in crypto, “it’s like a feeding frenzy”.
One of my favorite things about Bitcoin is that regular everyday people on the internet beat multi-trillion-dollar institutions to the best investment of the last decade.
— Joe Pompliano (@JoePompliano) October 20, 2021
Meanwhile Pimco’s CIO, Daniel Ivascyn, was speaking with CNBC on Wednesday and revealed the US-based asset manager already has exposure to “crypto-linked securities” through hedge fund portfolios, but has plans to gradually increase its investments and knowledge of the sector.
“This will be a gradual process where we spent a lot of time on the internal diligence side speaking to investors,” said Ivascyn. “And we’ll take baby steps in an area that’s rapidly growing.”
With at least US$2.2 trillion assets under management, according to the CNBC interview, Pimco is a giant in the sector of fixed-income securities investing. And the firm has revealed it’s planning to invest and trade further with “certain cryptocurrencies” as part of its “trend-following strategies”.
“Our perspective on crypto is, it’s potentially a store of value, that can be an inflation hedge,” Ivascyn continued. This is an area of the market that’s growing, and changing rapidly. It’s here to stay, to some degree, but you have to be very careful of regulatory responses.”
The CIO admitted that Pimco, or at least its leadership group, has a background that is very far removed from the crypto world, but that it’s doing all it can to learn more about the burgeoning sector.
“We’re doing a lot of work to stay on top of it,” he said. “It’s going to be a very important market. And it offers a pretty significant value proposition, particularly for the new generation of the investment community.
“You have to understand this technology. You have to understand decentralised finance. Because it will be disruptive, and it may very well disrupt our industry.”
Imagine calling yourself a sophisticated investor but having no exposure to crypto and getting beat to the punch by "Pimco" https://t.co/4YPjBCuFMZ
— Travis Kling (@Travis_Kling) October 20, 2021