While Bitcoin MSTR is in a decline, the New York State Pension Fund is strategically increasing its holdings in reverse.

Source: TokenPost Original Title: Despite Bitcoin and MSTR Falling Together… New York State Pension Fund Increased Stake in Strategy Original Link:

Market Background

Amid the significant decline in Bitcoin and MSTR’s main stock price, the New York State Pension Fund increased its holdings in MSTR, continuing its long-term investment strategy. This reflects a trend among institutional investors to expand indirect exposure to cryptocurrency-related assets.

This week, Bitcoin’s price fell by 3.5%, dropping to $86,214, while MSTR’s stock price plummeted over 7% in a single day. Despite this, the NY State Common Retirement Fund still increased its weight in MSTR. The fund manages approximately $284 billion in assets.

Investment Target Analysis

The investment target is a Strategy company listed on NASDAQ. The company is essentially known as a “Bitcoin proxy stock” because it holds a large amount of Bitcoin, making its stock price highly sensitive to Bitcoin’s price. As of December 15, MSTR fell to $163.55, with a market cap of $50.7 billion. The trading volume on that day was 14 million shares, with a transaction value of $2.32 billion.

Long-term Strategy or Short-term Momentum?

The NY State Pension Fund first increased its MSTR stake in Q2 of this year, with the third quarter holding approximately 0.10% of all stocks, valued at about $113.8 million. Although this is a very small part of the overall portfolio, it is noteworthy that the fund did not reduce its exposure during recent weak market conditions but instead maintained or increased its position.

New York State is one of the largest public pension funds in the US, with over 40% of its assets allocated to listed stocks, and the rest in bonds, real estate, private equity, and alternative assets. Therefore, investing in MSTR can be seen as part of risk diversification.

Similar actions have also been observed in other state pension funds. The New Jersey State Pension Fund has recently increased its holdings in MSTR. This indicates that more institutional investors are choosing to gain indirect exposure to cryptocurrency assets rather than direct investment.

Strategy’s Bitcoin Holdings Position

Strategy has been actively buying Bitcoin since the beginning of this year. According to reports filed with the US Securities and Exchange Commission, the company has added 10,645 BTC, with a total cost of approximately $980.3 million, at an average purchase price of $92,098. The company’s total holdings now amount to 671,268 BTC, the largest single-company holding.

Such a large position has provided Strategy’s stock price with significant leverage. From a high of $450 in July to the current range of around $160, the decline exceeds 62%. However, Strategy does not need to sell its Bitcoin holdings to manage cash flow; instead, it has recently set aside an additional $1.44 billion in cash reserves, enough to cover dividends and interest payments for the next year, with plans to extend coverage to two years.

Significance of Pension Participation

This move by the NY State Pension Fund indicates that, despite facing extreme short-term volatility, institutional investors maintain appropriate exposure to cryptocurrency-related assets from a long-term perspective. This may go beyond mere profit pursuit and reflect a strategic positioning. Especially during price declines, maintaining or increasing related positions demonstrates a “selective exposure” within a risk management framework.

Market interpretation: Against the backdrop of significant adjustments in Strategy’s stock price and Bitcoin’s price, the sustained or increased weight in these assets by robust public pension funds is seen as a signal of long-term institutional demand.

Strategic points: Although representing a very small proportion of the portfolio, continuous investment in assets indirectly linked to Bitcoin indicates that traditional finance is increasingly accepting alternative assets. The ongoing buying during market downturns suggests that long-term investment strategies are still in effect.