- Cryptocurrencies appear to be spreading its wings across the globe with the education sector now expressing its interests
- Renowned universities such as Harvard, Yale, Brown and University of Michigan are the schools whose multibillion-dollar endowments have commenced purchasing cryptocurrency directly on exchanges
- There are also claims of colleges storing funds on exchanges since 18 months
- In the past year, lot of endowments are allocating a small portion towards crypto and established universities are buying cryptocurrencies on exchanges
An endowment is an aggregation of assets invested by a university or college for supporting its educational goals for the long run. An institution’s endowment comprises hundreds or thousands of individual endowments.
Benefits to Universities
Rising institutional adoption has been one of crypto’s shining stories in the past year. While the unusual macroeconomic environment has accelerated crypto adoption, many large scale investors who made allocations in the pandemic intend to hold Bitcoins as a part of their core portfolio over the long run throughout varying market conditions.
University endowments generally gather funds such as charitable donations some of which are invested in other assets. The endowments are further used for paying teaching fees and research costs which are very steep and constant in nature.
Endowments funds have been allocating funds to crypto for maximizing returns
A lot of endowments funds have been allocating a small portion of funds to crypto for maximizing their returns. In 2018, Yale University made an investment of $400m in a fund launched by Coinbase. Very shortly, it was reported that Harvard and other institutions had invested in crypto funds.
Colleges around the world have been connected with cryptocurrency
It is an open secret that colleges around the world have been associated with cryptocurrencies for some time and high-net worth individuals have regularly made Bitcoins donations to established universities. Numerous such universities accept digital currency donations or have crypto backers funding these schools. There are also claims of colleges storing funds on exchanges since 18 months.
No confirmation on direct allocations into crypto
Till date, none of the above mentioned universities have confirmed direct allocations into crypto. This would aid in consolidating the point of view that Bitcoin and other cryptocurrencies are an emergent asset class, an idea many institutional investors have been warming since the pandemic of 2020.
If the universities admit of their investment in cryptocurrencies, it is bound to create a lot of friction among students and their families towards the universities. Any change in the fees structure could be attributed towards crypto investments. However, it is anticipated that the organizations will admit to their crypto investments in the near future.
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