Keith Ammon, New Hampshire State Representative for New Boston, Mont Vernon, Lyndeborough and Vice President of Commerce and Consumer Affairs, opened a discussion on the potential of diversifying the state's financial reserves into bitcoin ETFs. His comments, twitter.com/RepKeithAmmon/status/1789734542401552781″ target=”_blank” rel=”noopener nofollow”>aware on x (formerly twitter), highlights a dramatic what-if scenario that underscores btc's explosive growth over the past decade.
What bitcoin can do for New Hampshire
Ammon's reflection on the state's financial decisions comes at a time when btc and other digital assets are increasingly recognized by major institutional investors. Their detailed analysis posited: “Should the state of New Hampshire investigate allocating a small percentage of its reserves to a bitcoin ETF? Of course, hindsight is 20/20, but if the State of NH had put just 5% ($4.65 million) of its $93 million 2016 emergency fund into bitcoin and held onto it, that amount of btc today It would be worth almost 500 million dollars. ($473 million), a 10,000% return on investment.”
This statement follows a rise in institutional interest in btc as a viable asset class. According to recent information from BlackRock, the world's largest asset manager, there has been a notable increase in investors in bitcoin ETFs, which now include entities such as sovereign and pension funds.
Additionally, Ammon cites Manuel Nordeste, VP of Digital Assets at Fidelity, who recently highlighted the growing trend among major pension funds and big banks toward spot bitcoin ETF allocations, driven by growing interest in the digital asset market. . “25% of pension administrators present on a recent panel personally owned digital assets. If just 1% of state pension AUM ($5.5 trillion) flowed into btc, it would eclipse mining revenues, leading to a shortage of supply relative to demand and a rise in the price of bitcoin. ”Ammon stated.
Reflecting on possible future impacts, Ammon also referred to a prediction from Cathie Wood, CEO of Ark Invest, who predicted a significant increase in the value of bitcoin. Wood speculates that bitcoin could reach $3.8 million per unit in 2030 if institutional investors allocate more than 5% of their portfolios to the cryptocurrency.
Using this prediction, Ammon extrapolated the potential returns for New Hampshire: “If NH invested 5% ($14.5 million) of its $290 million emergency fund balance in a bitcoin ETF at current prices and held it until 2030 , would be valued at nearly $1 billion ($900 million), a 6,200% return on investment.”
The implications of such investments go beyond mere speculative profits. New Hampshire faces outstanding liabilities totaling about $1.45 billion, including $1.25 billion to the state pension system and about $200 million in bonds.
Ammon argues that exploring alternative investments like bitcoin could be a viable solution to these financial challenges and suggests: “How could we get out of that hole? The answer may be before us and deserves further investigation.”
The reactions of the btc community and financial experts were immediate. James Lavish, a prominent bitcoin authority, highlighted the importance of this consideration from a fiduciary responsibility perspective.
He commented: “The simple answer is yes. A more complicated answer is: not at least investigating a possible allocation in bitcoin would be a breach of fiduciary duty, considering alarming deficit levels and exponentially expanding federal debt.”
Dennis Porter, CEO and co-founder of Satoshi Act, a nonprofit that advocates for bitcoin mining in the US, succinctly supported the idea with: “You know my answer.”
Ammon's proposal underscores the growing politicization of bitcoin in the US, highlighting a shift toward cryptocurrencies becoming a major electoral issue. This trend is further evidenced by former US President Donald Trump's recent pivot towards a pro-btc and cryptocurrency stance, aiming to leverage this position in his bid to return to the White House.
Trump's change of heart marks a notable development, reflecting the growing relevance of cryptocurrencies in political strategies and national economic discussions.
At the time of publication, btc was trading at $62,799.
Featured image from Granite State Times, chart from TradingView.com
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