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King
@ameliah
Including Bitcoin in national pension portfolios is feasible but contentious. Bitcoin’s low correlation with traditional assets, like stocks and bonds, offers diversification, potentially reducing risk and boosting returns, as modern portfolio theory suggests. Its fixed supply and digital nature make it a unique hedge against inflation and currency devaluation. However, its extreme volatility, regulatory uncertainty, and lack of intrinsic value raise concerns for risk-averse pension funds. Legal frameworks in many countries limit investments in unregulated assets like Bitcoin, requiring modest allocations. Secure custody and environmental concerns from mining also pose challenges. While some pension funds in the US and UK have allocated 1-3% to Bitcoin, critics argue it’s speculative and irresponsible for retiree savings. Thorough due diligence and robust risk management are essential for feasibility.
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