US Police Retirement Fund to invest in cryptocurrencies

The agency can increase returns in the cryptocurrency sphere by engaging in the strategy of yield farming

04.05.2022 - 13:40

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What’s new? Fairfax County Police Officers Retirement System in Virginia is considering investing in two cryptocurrency funds that provide the service of yield farming. This was stated by the agency’s chief investment officer, Katherine Molnar. She reported that the funds would be used to provide liquidity on decentralized crypto exchanges. Molnar told about this at the Milken Institute Global Conference in Los Angeles, Bloomberg reports.

Bloomberg’s material

What else did Molnar say? The official expects that investing in farming can bring a yield of at least 9%. According to Molnar, Fairfax County’s crypto-focused investments account for more than 8% of its portfolio. In 2019, Fairfax County was one of the first in the United States to invest pension money in crypto investments. Last year, the county’s police and employees’ retirement systems invested $50 million into Parataxis Capital Management LLC’s fund, which buys various digital tokens and cryptocurrency derivatives.

What is farming? It is a way to earn passive income in the DeFi industry. Farming is the accrual of rewards to the user for the tokens they place in the pool, which provides liquidity to the project.

What events happened before? Fidelity Investments would allow 401(k) retirement savings account holders to invest directly in bitcoin. The new retirement investment plan in cryptocurrency would go into effect in late 2022. On April 26, MicroStrategy CEO Michael Saylor reported that the company would join this program.

On 29 March, the US Department of Labor criticized Fidelity’s proposal to invest retirement in bitcoin. The agency’s concerns stem from the volatility of the first cryptocurrency. The ministry believes that Fidelity’s initiative “risks the retirement security of Americans.”

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