Norway’s sovereign wealth fund, managed by Norges Bank Investment Management, has started 2024 with double-digit growth, reducing its exposure to major tech companies and increasing its involvement in the cryptocurrency market.
Fund Growth and Investments
In the first half of 2024, Norway’s wealth fund grew by 8.6%, with equity investments seeing a 12% rise. However, the fund slightly underperformed its benchmark, the FTSE Global All Cap Index, by 0.04%. The primary driver of this growth was the surge in technology stocks, spurred by increased demand for artificial intelligence solutions.
Increase in Crypto Investments
According to data analyzed by K33 Research senior analyst Vetle Lunde, the fund significantly increased its indirect exposure to Bitcoin by 62% in the first half of 2024. This was achieved by expanding investments in companies such as Coinbase, Marathon Strategy, Block Inc., and Marathon Digital. The fund's current holdings include 2,446 BTC, valued at approximately $142.9 million, or about $27 per capita for Norway’s 5.5 million residents.
Context and Outlook
Vetle Lunde noted that the increase in Bitcoin holdings is likely due to algorithm-based sector weighting and risk management strategies rather than a deliberate effort to accumulate Bitcoin. Nevertheless, the increase underscores Bitcoin’s maturation as an asset and its growing presence in diversified portfolios. Bitcoin's value has risen by over 30% this year, driven by the surge in tech stocks and new regulations that allow crypto to be included in exchange-traded funds (ETFs).
Norway’s sovereign wealth fund, established in the 1990s, globally reinvests the nation’s substantial oil wealth across various asset classes and regions, aiming for long-term returns. The increase in cryptocurrency investments highlights the recognition of crypto as a significant part of global investment strategies.
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