Florida’s Chief Financial Officer, Jimmy Patronis, has formally urged the State Board of Administration (SBA) to explore adding Bitcoin to the state’s pension fund investment portfolio.
In a letter dated October 29, 2024, addressed to SBA Executive Director Chris Spencer, Patronis outlined the potential benefits of cryptocurrency investments for the state’s public servants, including firefighters, teachers, and police officers.
Florida’s economic strength and investment strategy
Patronis highlighted Florida’s standing as a major economic power, noting that it would be the 16th largest economy worldwide if it were an independent nation. With a Triple A bond rating and a strong track record across key financial metrics, Patronis believes Florida is well-positioned to lead in innovative investment strategies. He pointed to the state’s involvement in space travel and FinTech as evidence of Florida’s commitment to economic growth. This letter marks a significant step in Florida’s consideration of cryptocurrency as a viable asset class for its pension funds.
Bitcoin as “Digital Gold” and portfolio diversification
In his proposal, Patronis referred to Bitcoin as “digital gold” and suggested it could serve as a hedge against the volatility of traditional assets. He proposed leveraging the Florida Growth Fund to launch a Digital Currency Investment Pilot Program focused on Bitcoin. By adding Bitcoin, Patronis believes the state can further diversify its portfolio, potentially enhancing returns for public-sector employees. He also pointed to other states, such as Wisconsin and Michigan, that have already allocated portions of their pension funds to cryptocurrency investments and Arizona’s legislative advancements.
Potential benefits and risks of Cryptocurrency investments
Patronis requested the SBA conduct a detailed report assessing the feasibility, risks, and potential returns of directing a portion of state pension funds into digital assets like Bitcoin. He noted recent developments in cryptocurrency, including President Trump’s proposal to create a national Bitcoin “stockpile” using seized assets, underscoring the growing acceptance of digital currencies.
Patronis also cited Governor Ron DeSantis’s stance against Central Bank Digital Currencies (CBDCs), emphasizing that decentralized cryptocurrencies align with financial autonomy and privacy. By exploring Bitcoin investments, Florida aims to adapt proactively to financial innovation while ensuring prudent management of state pension funds. The formal request comes as Bitcoin’s price recently surged to $73,577, nearing its all-time high.