First National Pension Service Makes 40% Profit with $20 Million Investment in Bitcoin and Ripple Exchange Coinbase

• South Korea’s National Pension Service bags 40% gain in Coinbase Shares investment.
• The fund’s investment underscores the potentials that lie in the crypto ecosystem.

South Korea’s National Pension Service (NPS), the world’s third-largest pension fund by assets, is currently making waves in the financial space by reaping a substantial 40% profit on a $20 million investment in the renowned crypto exchange Coinbase. 

NPS Crypto Investments

South Korea’s News outlet, News1 reported on Wednesday that the NPS acquired 282,673 shares of Coinbase Global during the third quarter of the year, as detailed in the holdings report submitted to the U.S. Securities and Exchange Commission (SEC). 

The value of this investment amounts to $19,934,100, equivalent to approximately 26.1 billion won. This marked the NPS’s first foray into the world of crypto-related securities, raising eyebrows and sparking discussions about the intersection of traditional finance and the rapidly evolving digital asset landscape.

Despite its historical reluctance to directly invest in virtual assets due to volatility concerns, the NPS seems to have navigated the crypto market successfully. The pension fund’s average purchase price per Coinbase share was $70.5, and with Coinbase closing at $98.15, the NPS is currently enjoying a remarkable profit of approximately 40% in just one quarter. 

Notably, Coinbase, listed on Nasdaq in April 2021, has become a forerunner for the crypto market, with its stock prices closely tied to the performance of virtual assets. Coinbase’s shares on the Nasdaq have surged by 192.1% from $33.6 at the beginning of this year, underscoring the growth potential in the crypto sector. 

Coinbase’s Strong Performance

The timing of the NPS’s investment appears strategic, as Coinbase has demonstrated robust financial performance. The digital asset exchange reported $674.1 million in revenue for the third quarter of this year, reflecting a 14.2% year-on-year increase. Despite a net loss of $2 million for the quarter, compared to a loss of $545 million in the same period last year, Coinbase’s strong revenue figures have bolstered investor confidence.

Additionally, the crypto market has seen increased interest and optimism, fueled in part by the potential approval of spot Bitcoin Exchange-Traded Funds (ETFs) in the United States. This development has piqued the interest of investors, leading to an increase in investment in crypto-related assets. The recent increase in the price of Bitcoin, which has risen 5.1% in the last 24 hours to $37,474, has added to the momentum.

It’s worth noting that the NPS faced criticism in 2021 when it was revealed that a fund it invested in had exposure to a digital asset-related business. At that time, the NPS clarified that it only invested in the exchange itself, emphasizing that cryptocurrencies were not a direct investment target for the pension fund. 

However, the NPS’s strategic move into the cryptocurrency ecosystem through its investment in Coinbase demonstrates a shifting attitude towards digital assets among traditional financial institutions. The NPS’s substantial profit in a short span highlights the potential for substantial gains in the crypto market.

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