Breaking News
Investing Pro 0
New Year’s SALE: Up to 40% OFF InvestingPro+ CLAIM OFFER

Exclusive: Canada's biggest pension plan, CPPI, ends crypto investment pursuit - sources

Economy Dec 07, 2022 02:01PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: A representation of bitcoin is seen in front of a stock graph in this illustration taken May 19, 2021. REUTERS/Dado Ruvic/File Photo

By Divya Rajagopal

TORONTO (Reuters) - Canada's biggest pension fund, CPP Investments, has ended its effort to study investment opportunities in the volatile crypto market, two people familiar with the matter told Reuters.

The reasons behind CPPI's abandonment of crypto research were not immediately clear. CPPI declined to comment but said it has made no direct investments in crypto. It referred to previous comments on cryptocurrency by its CEO, John Graham, in which he sounded a note of caution.

CPPI's Alpha Generation Lab, which examines emerging investment trends, had formed a three-member team in early 2021 to research crypto currencies and blockchain-related businesses, with a view to taking potential exposure, the people added.

But CPPI abandoned the pursuit this year and redeployed the team to other areas, the sources said.

CPPI's move also comes as two of Canada's largest pension funds have written off their investments after the collapse of crypto exchange FTX and crypto lender Celsius this year.

Earlier this year CPPI CEO Graham said that the pension plan, which manages C$529 billion ($388 billion) for nearly 20 million Canadians, did not want to invest in crypto merely because of the fear of missing out.

"You want to really think about what the underlying intrinsic value is of some of these assets and build your portfolio accordingly," Graham said in a June speech. "So I'd say crypto is something we continue to look at and try to understand, but we just haven't really invested in it."

It was unclear when CPPI dropped its plan. One of the sources said the team was actively assessing investment opportunities as late as July this year, but the second source said the team ended its work earlier than that.

The details of CPPI's pursuit of cryptocurrency investment and its decision to end it have not been previously reported.

The sources declined to be identified because the information was not public.

Canadian pension funds' exposure to crypto sector has come under scrutiny following the FTX debacle. While Canadian pension funds are not prohibited from buying cryptocurrencies, they are known for their risk-averse investing strategies to generate steady returns for pensioners.

While CPPI has avoided crypto investments, some of its peers have been caught up in the sector's mayhem this year. The Ontario Teachers Pension Fund (OTPP), which oversees about C$242 billion in assets, has written off its investments worth C$95 million in FTX. OTPP said it was "disappointed" with its investment in FTX.

Earlier this year, Canada's second-largest pension fund, Caisse de dépôt et placement du Québec (CDPQ), said it was writing off its investment of C$150 million in bankrupt crypto lending firm Celsius. CDPQ has initiated legal proceedings against Celsius in bankruptcy court.

The Ontario Municipal Employees Retirement System (OMERS), which manages C$121 billion, made three allocations to crypto-linked businesses through its OMERS Ventures business between 2012 and 2018 but exited all investments in 2020.

Another Canadian pension fund, OP Trust, told Reuters that it has investments in the digital asset fund space that is managed externally. The investment is in the underlying crypto technology, it said.

($1 = 1.3650 Canadian dollars)

Exclusive: Canada's biggest pension plan, CPPI, ends crypto investment pursuit - sources
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email