With a $100 million stake in bitcoin and a $5 million share in shares in NYDIG, Massachusetts Mutual Life Insurance Co. is getting into the institutional bitcoin game.
MassMutual, which has been operating since 1851, has poured cash into the crypto business in light of rising institutional acceptance and demand. This year, Bitcoin has more than doubled in volume, and earlier this month, it reached an all-time high. Advocates claim that amid the cryptocurrency’s historical uncertainty, Bitcoin is a sort of digital gold, likely to maintain its value during periods of instability and protection against inflation. Hence the massive purchase by MassMutual.
The twin plays, both announced in a press release on Thursday, giving MassMutual direct exposure to the price fluctuations of the cryptocurrency and signal that it is betting that other big fish will follow suit. With $2.3 billion under administration, NYDIG is one of the fastest-growing institutional crypto-shops. MassMutual made the $100 million acquisition.
MassMutual told the Wall Street Journal it was pursuing “measured yet meaningful” exposure to an increasingly digital environment without clearly explaining why it saw bitcoin as a fair investment.
MassMutual’s $100 million BTC bet is barely a drop in the hulking $235 billion money bucket in its general investment portfolio. Coming from a 169-year-old insurance institution in the risk measurement industry may have an outsize impact on mainstream investors on the interpretation of bitcoin.
As of Sept. 30, the Bitcoin investment will constitute 0.04 percent of the general investment portfolio of almost $235 billion, MassMutual said. “We see this initial investment as a first step, and like any investment, may explore future opportunities,” spokeswoman Chelsea Haraty said in an email.
The storyline has been played out all year already.
This year, the life insurance corporation is the new global stalwart to enter bitcoin’s march into the financial mainstream. Publicly traded companies and storied investment investors have accepted the blockchain at a rate not seen at any other time of its existence since the pandemic took root.
But MassMutual is continuing to accept the infrastructure that drives institutional acceptance through its dual investment in NYDIG, the business that initiated this acquisition.
In its courting of the institutional elite, NYDIG has been forthright. On Wednesday, the organization hired crypto banker Patrick Sells to lead its outreach activities for crypto-services.
It routinely attracts tens of millions of dollars, including a $100 million bitcoin fund filed over Thanksgiving, for crypto funds. Just a single investor had the mammoth engine, as CoinDesk confirmed at the time.
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