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A pension fund, which is run by a board of directors and manages $400bn, is not going to print a paper wallet to hold $2bn worth of Bitcoin. They have more imp
by charlesdm 9y ago
A pension fund, which is run by a board of directors and manages $400bn, is not going to print a paper wallet to hold $2bn worth of Bitcoin.
They have more important things to worry about, like investing their $400bn and achieving a decent return on their entire holdings.
Second to that (or maybe even more importantly), it's ass covering. Imagine the headlines: "CALPERS INVESTS $2BN IN BITCOIN AND ETHEREUM, AND LOSES ACCESS KEYS". If you're managing a fund, you just don't risk that.
These custodian fees (which will come down eventually) are a cost of doing business to access the asset class. I would assume those entire crypto holdings also to be insured as part of said fee, in the event something does go wrong.
- pishpash 9y agoStill, how is that more expensive than keeping physical gold?
- charlesdm 9y agoIts 1.2% a year -- that's expensive. He states Gold ETFs pay approx. 0.08% per year to store bullion (no idea whether that's a correct number though). But hey, it's better than paying a 2-20% fee to a hedge fund vehicle. Fees are already coming down!
- alex_young 9y agoWhy not cast the hashes inside gold bars? Then just keep storing the gold. Btc storage for free.
- deleted 9y ago[deleted]
- garmaine 9y agoLike this? https://bitcointalk.org/index.php?topic=196320.0 https://bitcointalk.org/index.php?topic=196320.0
- knocte 9y agoThis is why multi-sig exists. Put the funds in a 6-of-10 account, done. You would need a 60% attack (60% of the executives to collude/conspire, or 60% being hacked/kidnapped) to be robbed.
- charlesdm 9y agoYes, if you're a $10m hedge fund or a small family office. But not if you need to manage $400bn; then you (really) want a custodian. These people allocate and mostly invest in funds with exposure to certain asset classes (private equity, VC, hedge funds, equity and bond funds, etc).
- knocte 9y ago> you (really) want a custodian Are you really referring to a single (non-plural) custodian...?
- wmf 9y agoA custodian company, not a person.
- knocte 9y agoAh, sure, and that custodian company will most likely hold the bitcoins in a multisig account. Now you have to pay a company for this service and also have counter-party risk. Great. Maybe the risk and cost is not worth it and setting up a multi-sig inhouse is worth it?
- asadlionpk 9y agoLooks like most don't think this way. They think that they don't have the 'expertise' in-house for maintaining multisig account. So they will just have to hire an 'expert' custodian to reduce risk.
- 9y ago
- rakoo 9y agoSo it's not "more expensive to keep safe", it's "more expensive to use as a trading asset", which is completely different.
- charlesdm 9y agoIt's expensive if you lose it -- which is all that matters to these people.
- rebuilder 9y agoI can't see "CALPERS INVESTS $2BN IN CRYPTO AND GETS SCAMMED" being any better, honestly. I'm sure you can insure crypto holdings, but considering the risks, the cost must be exorbitant.
- deleted 9y ago[deleted]