Luxembourg Sovereign Wealth Fund Buys Bitcoin, Reveals Groundbreaking European Crypto Allocation

Luxembourg’s intergenerational sovereign wealth fund (FSIL) is accumulating Bitcoin (BTC), becoming the first European nation to dedicate funds toward allocating crypto.

The nation’s Ministry of Finance says its sovereign fund has been revised under its mission to “create savings whose income can be used, under certain conditions and within certain limits, to contribute to the well-being of future generations.”

Among the assets listed in the fund is a category marked “alternative assets” which comprise up to 15% of the fund and include private equity – mostly in the technology and defense sectors – real estate, as well as crypto assets, particularly the crypto king.

Digital assets and “particularly Bitcoin” now make up 1% of the fund, while private equity and real estate make up 10% and 4% respectively.

In a post on LinkedIn, Bob Kieffer, Luxembourg’s Director of the Treasury, says the 1% digital asset allocation is the “right balance” for the fund and that it only purchased BTC through exchange-traded funds (ETFs).

“Under the revised framework, the FSIL will continue to invest in equity and debt markets, while now also being authorized to allocate up to 15% of its assets to alternative investments. These include private equity and real estate, as well as crypto assets.

To avoid operational risks, the exposure to Bitcoin has been taken through a selection of ETFs. Some might argue that we’re committing too little too late; others will point out the volatility and speculative nature of the investment.

Yet, given the FSIL’s particular profile and mission, the Fund’s management board concluded that a 1% allocation strikes the right balance, while sending a clear message about Bitcoin’s long-term potential.”

BTC is trading at $113,420 at time of writing, a 6.79% drop in the last 24 hours.