The Michigan State Retirement System disclosed more than $11 million in exposure to Ethereum (ETH) spot exchange-traded funds (ETFs) in its latest 13-F filing.
As a result, Michigan became the first state to invest in Ethereum and currently holds a larger position in Ethereum ETFs, compared to the $7 million invested in spot Bitcoin ETFs earlier this year.
As of September 30, the Michigan State Pension Fund held 460,000 shares of the Grayscale Ethereum Fund (ETHE), the equivalent of $10 million. She also held 460,000 shares of the asset manager’s Ethereum Mini Trust, worth $1.1 million.
Matthew Sigel, Head of Digital Asset Research at VanEck highlighted that this makes state pensions the fourth and second largest holders of shares in these funds respectively.
A “big victory” for Ethereum
The Form 13-F revealed that the Michigan pension fund still holds its shares of the ARK 21Shares Bitcoin ETF (ARKB) were reported in their latest Form 13-F. As the price of Bitcoin (BTC) increased, holdings amounted to almost $7 million as of September 30.
Notably, with the addition of Ethereum ETFs, the Treasury was more exposed to ETH than BTC at the end of the third quarter.
Bloomberg ETF senior analyst Eric Balchunas said the public pension fund’s investment was a “pretty big win” for Ethereum. He noted that the fund decided to add more exposure to ETH despite its lackluster annual price performance compared to BTC.
Furthermore, in addition to the Michigan pension fund, the State of Wisconsin Investment Board reported $164 million exposure to Bitcoin via ETFs. Jersey City And Florida politicians have also publicly mentioned adding BTC to their pension funds this year.
This is likely why Balchunas considered Ethereum ETFs attracting the attention of a public pension fund to be a big win.
The tables are about to turn
The performance disparity between Ethereum and Bitcoin is also seen when comparing their ETF flows. US-traded Bitcoin ETFs registered $24.2 billion in annual inflows, while their Ethereum counterparts showed nearly $480 million in negative net flows.
ETF Shop CEO Nate Geraci predicted in March, Ethereum ETFs would be “a bigger deal” than the market expected. He explained that demand for Bitcoin ETFs was also severely underestimated and therefore Ethereum ETFs could suffer in the same way.
Geraci reiterated his beliefs on November 3: addition that it is only “a matter of time” before inflows of US-traded Ethereum ETFs begin to resume.
