Jeroen van der Put: Cryptos are speculative investment that can go either way

Jeroen van der Put: Cryptos are speculative investment that can go either way

February 14, 2025

Crypto
Jeroen van der Put (Cor Salverius Fotografie).jpg

This text was originally written in Dutch

By Esther Waal

Are institutional investors ready for crypto? That question has become relevant now that Donald Trump's re-election and his openly pro-crypto stance have boosted many investors' confidence in cryptocurrencies. That confidence was already growing following the introduction of Bitcoin ETFs and the involvement of some major financial institutions in them. To what extent do crypto-currencies fit into pension fund portfolios? Financial Investigator spoke to Jeroen van der Put, independent pension fund manager and advisor to several pension funds.

What most deters institutional investors from investing in cryptocurrencies?

'It is not a long-term sustainable investment and has relatively many uncertainties. It has no intrinsic value or cash flow and has extremely high volatility. The valuation, risk profile and contribution to the portfolio are therefore difficult to determine ex ante. Cryptocurrencies cost a lot of energy, which also has significant negative environmental impacts. It is a speculative investment that can go either way depending on the confidence placed in it. And that comes on foot and goes on horseback. The value can go down sharply because of incidents related to cybercrime, far-reaching regulation and new solutions.'

Have the organisations you are involved with considered investing in cryptocurrencies?

It has not been seriously considered anywhere. However, we do systematically look at categories that could add value to the portfolio. Thus, crypto has also come along on occasion, but has also been quickly dropped, due to the test of investment beliefs and the aforementioned arguments.

'It is a speculative investment that can go either way.'

 

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