Morgan Creek’s New Crypto Fund Raises $40m, Led by 2 Pension Funds

February 12, 2019
Giancarlo Roma


Morgan Creek’s New Crypto Fund Raises $40m, Led by 2 Pension Funds

Early this morning, United States-based digital asset firm Morgan Creek Digital announced a new $40 million crypto venture fund that includes two large pension funds. The news was reported today by Bloomberg, who cited a statement from Morgan Creek, who said this was most likely the first investment in the crypto space from a U.S. pension fund.

In addition to the two major pension funds — which are two of the three benefit plans from the Fairfax County Retirement Systems in Virginia — the company secured funding from a private foundation, an insurance company, and a university endowment. According to Bloomberg, this news came from Morgan Creek Digital founder Anthony Pompliano, who is known also for his large Twitter following.

In August of last year, Bloomberg reported that Morgan Creek launched a Digital Asset Index Fund in partnership with Bitwise, with the goal of giving institutional investors (like pensions and endowments) exposure to the cryptoasset market in the form of Bitcoin, Ether, and eight other currencies. However, notably, Ripple and Stellar were not included, as the fund did not include pre-mined currencies. Additionally, the index is synthetic in nature, meaning it is not backed by any physical assets; it merely tracks the price.

Morgan Creek Digital is backed by industry giant Morgan Creek Capital, which has over $1.5 billion under management. The new VC fund is called the Morgan Creek Blockchain Opportunities Fund and, as per a report by The Next Web.

On Christmas Eve, Pompliano published a blog post on Medium entitled, “Every pension fund should buy Bitcoin,” claiming there is a growing pension crisis in the United States, as “it does not look like they will be able to pay their future obligations” due to “the gap between revenue and expenses” that has worsened due to lower birth rates and longer life expectancies. While the post has proved prescient, it seems like the writing may have been on the wall before it was on the post:

“The fundraising for this fund didn’t happen overnight,” Pompliano told The Next Web, “So it definitely took place before that article was written.”

According to the report, the investors in the new fund already have exposure to such blockchain-based companies as Bakkt, Coinbase, Realblocks, and Namebase.