In a surprising turn of events, the Wisconsin State Investment Board has divested its entire $350 million stake in BlackRock’s iShares Bitcoin Trust (IBIT). This decision marks a significant shift for the state pension fund, which had previously made headlines by becoming the first state to invest in a Bitcoin ETF in 2024.

Key Takeaways

• Wisconsin State Investment Board sold its entire $350 million stake in Bitcoin ETF.
• The divestment follows a significant decline in Bitcoin's value, dropping over 12% in Q1 2025.
• The board had initially increased its investment in Bitcoin before reversing its position.
• Despite selling its Bitcoin ETF stake, Wisconsin still maintains indirect exposure to cryptocurrency through shares in MicroStrategy.

Background On The Investment

In late 2024, the Wisconsin State Investment Board made a landmark decision to invest in BlackRock’s iShares Bitcoin Trust, increasing its holdings from 2.9 million shares to 6 million shares. This move was seen as a bold step into the cryptocurrency market, reflecting a growing acceptance of digital assets among institutional investors.

However, the cryptocurrency market has been notoriously volatile, and 2025 has proven to be no exception. Following a sharp decline in Bitcoin's price, the investment board decided to exit its position entirely, as indicated in its latest 13F filing with the U.S. Securities and Exchange Commission (SEC).

Market Volatility and Its Impact

The decision to sell off the Bitcoin ETF stake comes amid a turbulent year for cryptocurrencies. Bitcoin, which had seen a resurgence, recently returned to the $102,000 mark, with projections from financial institutions like JPMorgan suggesting it could outperform gold in the latter half of the year. Despite this optimistic outlook, the Wisconsin State Investment Board opted to cut its losses, highlighting the unpredictable nature of the crypto market.

Future Investments

While the board has divested from the Bitcoin ETF, it has not completely turned its back on the cryptocurrency sector. In a strategic move, the Wisconsin State Investment Board purchased 26,571 shares of MicroStrategy (MSTR), valued at approximately $10.5 million. This indicates that while the board is cautious about direct investments in Bitcoin, it is still seeking indirect exposure to the cryptocurrency market.

Conclusion

The Wisconsin State Investment Board's decision to sell its $350 million stake in the Bitcoin ETF reflects the complexities and risks associated with investing in cryptocurrencies. As the market continues to evolve, institutional investors will need to navigate these challenges carefully, balancing potential rewards against the inherent volatility of digital assets. The board's continued interest in MicroStrategy suggests that while it may be stepping back from direct Bitcoin investments, it remains engaged with the broader cryptocurrency landscape.

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