The State of Michigan Retirement System revealed had purchased a stake in Grayscale’s spot Ethereum exchange-traded fund, becoming the first pension holder to do so since ETH ETFs went live in July.
Other pension funds and U.S. states have invested in crypto-related financial instruments.

The State of Michigan Retirement System has revealed a new holding in Grayscale’s Ethereum exchange-traded fund, becoming the first pension fund to do so since the ETH-based financial instrument began trading in July.

The Michigan pension agency disclosed in a 13F filing that it held 460,000 shares of the Grayscale Ethereum Trust (ticker: ETHE), valued at about $10 million as of the end of the third quarter, making it a top-five holder of the fund, according to VanEck's Matthew Sigel. It also disclosed holdings of 460,000 shares of the Grayscale Ethereum Mini Trust ETF (ETH), valued at about $1.1 million.

U.S. states and pension funds have repeatedly demonstrated an appetite for investing in crypto and crypto-related products. In May, it came to light that the State of Wisconsin Investment Board held nearly $100 million of the spot bitcoin exchange-traded fund issued by BlackRock. Last week, Florida’s chief financial officer said the state holds about $800 million in “crypto-related” investments and could grow depending on who wins the upcoming presidential election.

The State of Michigan Retirement System has previously disclosed it owned about $7 million worth of spot bitcoin ETF holdings.

'Big win for ether"

"Not only did Michigan's pension buy ether ETFs, but they bought more then they did of bitcoin ETFs, $10 million vs $7 million, this despite BTC being up a ton and ether in the gutter," Bloomberg Senior ETF Analyst Eric Balchunas said in a post to X. "Pretty big win for ether which could use one."

Pension funds investing in crypto dates back to at least 2021.

Earlier this year, London-based Nickel Digital research said that institutional investors and wealth managers with crypto holdings were planning to increase their investments in crypto. Nickel Digital said at the time that around 74% of institutional investors and wealth managers with digital asset exposure planned to increase their investment levels.

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Jason is a U.S. news editor at The Block. He previously worked as a staff writer and later served as managing editor at Benzinga, a financial news and data company. He led Benzinga's daily markets coverage as well as the expansion of the outlet's cannabis, cryptocurrency and sports betting verticals. He earned a bachelor's degree in journalism from Central Michigan University and resides in the suburbs of Detroit, Michigan. Follow him on X @JasonShubnell.

RT Watson is a senior reporter at The Block who covers a wide array of topics including U.S.-based companies, blockchain gaming and NFTs. Formerly covered entertainment at The Wall Street Journal, where he wrote about Disney, Netflix, Warner Bros. and the creator economy while focusing primarily on technological disruption across media. Previous to that he covered corporate, economic and political news in Brazil while at Bloomberg. RT has interviewed a diverse cast of characters including CEOs, media moguls, top influencers, politicians, blue-collar workers, drug traffickers and convicted criminals. Holds a master's degree in Digital Sociology.