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The State of Michigan Retirement System disclosed over $11 million in exposure to spot Ethereum (ETH) exchange-traded funds (ETF) in its latest 13-F filing.
As a result, Michigan became the first state to invest in Ethereum and currently holds a larger position in Ethereum ETFs, compared to the $7 million invested in spot Bitcoin ETFs earlier this year.
As of Sept. 30, the Michigan state pension fund held 460,000 Grayscale Ethereum Fund (ETHE) shares, equivalent to $10 million. It also held 460,000 shares of the asset manager’s Ethereum Mini Trust, which amounted to $1.1 million.
VanEck head of digital assets research Matthew Sigel highlighted that this makes the state pension the fourth and second largest holder of these funds’ shares, respectively.
A ‘big win’ for Ethereum
The 13-F Form revealed that the Michigan pension fund still holds its shares of ARK 21Shares Bitcoin ETF (ARKB) reported in their latest 13-F form filing. As the Bitcoin (BTC) price increased, the holdings represented nearly $7 million as of Sept. 30.
Notably, with the addition of the Ethereum ETFs, the state treasury had more exposure to ETH than BTC at the end of the third quarter.
Bloomberg senior ETF analyst Eric Balchunas said the state pension fund’s investment was a “pretty big win” for Ethereum. He noted that the fund decided to add more exposure to ETH despite its lackluster yearly price performance compared to BTC.
Furthermore, in addition to the Michigan pension fund, the State of Wisconsin Investment Board reported a $164 million exposure to Bitcoin via ETFs. Jersey City and Florida politicians also publicly mentioned adding BTC to their pension funds this year.
This is likely why Balchunas considered Ethereum ETFs getting attention from a state pension fund as a big win.
Tables about to turn
The disparity in performance between Ethereum and Bitcoin is also witnessed when comparing their ETF inflows. US-traded Bitcoin ETFs registered $24.2 billion in yearly inflows, while their Ethereum counterparts showed nearly $480 million in negative net flows.
Nate Geraci, CEO of the ETF Store, predicted in March that Ethereum ETFs would be “a bigger deal” than the market expected. He explained that Bitcoin ETF demand was also severely underestimated, thus Ethereum ETFs could suffer the same.
Geraci reiterated his beliefs on Nov. 3, adding that it is only “a matter of time” before US-traded Ethereum ETF inflows start picking up.