Key Takeaways
- • CalPERS and CalSTRS, California's two largest public pension funds, hold hundreds of millions of dollars in crypto-linked public equities, including Coinbase and Strategy, without holding Bitcoin or cryptocurrency directly.
- • At Bitcoin's peak last year, the combined crypto-related holdings were worth over $500 million; they are currently worth less than $300 million, according to the Orange County Register.
- • The crypto-linked exposure equals roughly 0.03% of the nearly $900 billion in combined assets managed by CalPERS and CalSTRS.
- • Strategy's stock functions as a leveraged proxy for Bitcoin, with Bitcoin trading above $126,000 last October and below $67,000 at the start of March.
- • The commentary, co-authored by Mariana Trujillo of the Reason Foundation, argues crypto risk should be disclosed separately in asset-allocation reports, since California's pension benefits are guaranteed and taxpayers absorb unfunded liabilities.
Summary
California's two largest public pension systems, the California Public Employees Retirement System (CalPERS) and the California State Teachers Retirement System (CalSTRS), hold hundreds of millions of dollars in crypto-linked assets despite never having purchased Bitcoin or cryptocurrency directly, according to an Orange County Register report dated March 6, 2026. The funds disclosed holdings in Coinbase, a publicly traded crypto exchange, and Strategy, the company formerly known as MicroStrategy. At Bitcoin's market peak last year, these positions were worth over $500 million combined; they are now worth less than $300 million.
The exposure is small relative to scale. The crypto-linked equities represent about 0.03% of the nearly $900 billion in total assets managed by the two funds. The article's central concern is less the size of the position or its current losses than the way crypto risk has entered public pension portfolios through conventional equity investments, which require no new legal authorization.
The report highlights Strategy as the most acute case. Although classified as a software firm, Strategy has financed large Bitcoin purchases through debt and equity issuance, so its stock acts as a highly leveraged proxy for Bitcoin. Bitcoin traded above $126,000 last October but was under $67,000 at the start of March, while Strategy shares fell from above $450 last year to below $130 in the most recent week.
The article also notes that pension exposure extends through venture capital and private equity funds mandated to invest in digital-asset companies, holdings that are typically reported as generic public or private equities. Other U.S. pension funds have similarly accumulated crypto exposure through index funds, active equity strategies, and crypto-linked exchange-traded products.
The author, Mariana Trujillo, managing director of government finance at the Reason Foundation and co-author of the study "U.S. public pension and trust fund investment in digital assets," argues that the stakes are heightened because California pension benefits are guaranteed. At the end of fiscal 2024, CalPERS and CalSTRS reported about $205 billion in unfunded liabilities, rising to nearly $270 billion including local systems. Losses would fall on taxpayers through higher contributions, tax increases, or service cuts. The piece recommends that crypto-related exposure be disclosed separately in asset-allocation reports, and that any allocations be small, fully disclosed, subject to strict custody and stress testing, and have defined exit strategies.
The exposure is small relative to scale. The crypto-linked equities represent about 0.03% of the nearly $900 billion in total assets managed by the two funds. The article's central concern is less the size of the position or its current losses than the way crypto risk has entered public pension portfolios through conventional equity investments, which require no new legal authorization.
The report highlights Strategy as the most acute case. Although classified as a software firm, Strategy has financed large Bitcoin purchases through debt and equity issuance, so its stock acts as a highly leveraged proxy for Bitcoin. Bitcoin traded above $126,000 last October but was under $67,000 at the start of March, while Strategy shares fell from above $450 last year to below $130 in the most recent week.
The article also notes that pension exposure extends through venture capital and private equity funds mandated to invest in digital-asset companies, holdings that are typically reported as generic public or private equities. Other U.S. pension funds have similarly accumulated crypto exposure through index funds, active equity strategies, and crypto-linked exchange-traded products.
The author, Mariana Trujillo, managing director of government finance at the Reason Foundation and co-author of the study "U.S. public pension and trust fund investment in digital assets," argues that the stakes are heightened because California pension benefits are guaranteed. At the end of fiscal 2024, CalPERS and CalSTRS reported about $205 billion in unfunded liabilities, rising to nearly $270 billion including local systems. Losses would fall on taxpayers through higher contributions, tax increases, or service cuts. The piece recommends that crypto-related exposure be disclosed separately in asset-allocation reports, and that any allocations be small, fully disclosed, subject to strict custody and stress testing, and have defined exit strategies.
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