Marquette University professor suggests US states follow Wisconsin’s lead in investing in spot BTC ETFs

According to TechFlow, David Krause, professor emeritus at Marquette University, suggested that other U.S. states could follow Wisconsin's lead in investing in spot BTC ETFs. He called BTC a "good investment" for state pension funds, emphasizing BTC's role in diversification, such as its high potential upside returns and its use as a hedge against inflation. Krause added that BTC's ability to smooth out volatility in government actions has not been fully recognized. Despite Krause's optimism, he clarified that only the Wisconsin Investment Board (SWIB) and some other state funds are able to withstand the market cycles and volatility of Crypto assets.

Krause did not predict which states are most likely to invest. However, data from Equable shows that seven state pension funds will have funding ratios greater than or equal to Wisconsin's 95% in 2023. Three of the seven funds have excess funding ratios of more than 100%. In contrast, Illinois is the least funded state pension board with a funding ratio of 51%.

Krause also expressed his views on the possibility of Wisconsin's rising status. He called SWIB’s initial investment a “test run,” saying: “I think it’s just an entry point. I think they’re testing the waters to see if there’s resistance to owning this money.” SWIB holds more than $160 million in spot BTC ETF shares, including BlackRock’s IBIT and Grayscale’s GBTC. Krause estimates that the investment represents 0.1% of SWIB’s total value of $180 billion, though the latest filing puts the fund’s value lower at $37.9 billion.