South Korean Pension Fund Nets 40% Profit On $COIN Investment


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South Korea’s National Pension Service (NPS) has recorded a highly profitable Q3 in 2023 by making significant profits on its $20 million investment in Coinbase shares. 

Strategic Dive into Cryptocurrencies

In a bold move, South Korea’s National Pension Service (NPS) has emerged victorious in the crypto market, reporting a remarkable 40% profit in Q3 2023 on its $20 million investment in Coinbase ($COIN) shares.

The NPS, traditionally conservative in its investment strategies, made waves by venturing into the cryptocurrency realm. The pension giant’s Q3 earnings report submitted to the U.S. Securities and Exchange Commission revealed a strategic investment in Coinbase, a major player on the Nasdaq exchange.

The NPS purchased 282,673 shares of Coinbase at an average price of $70.5, amounting to nearly $20 million. This move marks a significant shift for the pension fund as it enters the virtual asset space within its U.S. stock portfolio.

Coinbase’s Impressive Q3 Earnings

Following the NPS investment, Coinbase witnessed a substantial uptick in its stock price, soaring by an impressive 6.58% in a single day. Nasdaq’s closing figure settled at $98.15, a noteworthy surge from the year’s beginning at $33.60, indicating a staggering 192.1% rise.

In its Q3 report, the company disclosed revenue of $674.1 million, marking a 14.2% year-on-year increase. Notably, the net loss stood at $2 million, representing a significant improvement from the $545 million loss reported in the corresponding period the previous year.

Market Trends

The NPS’s strategic move aligns with the growing excitement surrounding cryptocurrencies, fueled by potential approvals of spot bitcoin exchange-traded funds (ETFs) in the U.S. and the recent surge in bitcoin prices. Bitcoin itself has experienced a substantial surge, boasting a 126.3% rise this year and currently trading at $37,446 in Asia.

Investors, intrigued by the crypto market and the growing buzz around possible crypto exchange-traded funds (ETFs), are showing an increased interest in stocks associated with digital assets. The South Korean pension fund’s foray into crypto signals a changing landscape where traditional financial institutions are acknowledging the significance of digital assets.

Criticism and Future Prospects

While some have celebrated the NPS’s move, South Korea’s National Assembly has criticized the fund for exposing itself to businesses linked to virtual assets.

Pension funds investing in cryptocurrencies face skepticism, with critics arguing that digital assets don’t generate cash and returns are contingent on finding the next buyer willing to pay more.

In summary, the NPS’s lucrative 40% profit on its $COIN investment signals a transformative shift in traditional financial institutions’ approach to cryptocurrencies despite facing criticism for entering the volatile world of digital assets.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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