Morgan Creek Digital (MCD) has not only raised $40 million for its latest blockchain venture capital fund, but the backing is also chiefly anchored by two pension plans from Fairfax county in Virginia.
Bloomberg has noted (Feb 12) that this is probably the first-ever such investment in the crypto asset space by a US pension fund. The new capital fund, dubbed the Morgan Creek Blockchain Opportunities Fund, initially targeted a $25 million investment. Other investors include an insurance company, a university endowment, and a private foundation – none of which have been identified publicly by MCD so far. MCD is an affiliate of investment manager Morgan Creek Capital.
MCD founder Anthony Pompliano said the new fund is like a traditional venture capital fund but invests in the equity of companies from the blockchain and digital assets industry. It will also hold “a small percentage” of value in liquid cryptocurrencies like Bitcoin.
Fairfax County Retirement Systems manages three pension plans, two of which invested in MCD’s new fund. Both plans collectively manage $5.1 billion worth of assets for Virginia’s police force and other employees. Katherine Molnar, CIO of one of the pension plans, said that blockchain technology is an “emerging opportunity” that offers an “attractive asymmetric return profile.’’
“It will take time for pension funds to get comfortable with investing in Bitcoin,” Pompliano wrote in a blog post at Christmas last year. However, “when one investor makes the decision, it will create a cascading effect that leads to hundreds of them jumping in.”