• Ontario Teachers’ Pension Plan (OTPP) – Canada’s largest single-profession pension plan – has decided to stay away from cryptocurrency investments following its bad experience with FTX.
• OTPP invested $95 million into the now-bankrupt exchange, which eventually shrank to virtually zero.
• Jo Taylor, Chief Executive Officer of the pension plan, said it was based in part on “feedback from our members” and they regret any loss on their behalf.
Canada’s Largest Pension Fund Writes off FTX Investment
Ontario Teachers’ Pension Plan (OTPP) — Canada’s largest single-profession pension plan — recently wrote off its investment of $95 million into the now-bankrupt exchange FTX. The dramatic crash caused this sum to shrink to virtually zero.
Feedback from Members Leads to Change of Heart
Jo Taylor, Chief Executive Officer of the $190 billion pension plan, said that due to feedback from members and their regret for any losses on their behalf, the entity will refrain from investing in cryptocurrencies.
Two Investments Made Into FTX
OTPP had previously shown support toward FTX by making two separate investments in 2021 and early 2022 for a total of $95 million when it was one of the leaders in its field during a crypto market bull run. Although this amounted to less than 0.05% of its total assets, there were criticisms surrounding OTPP dealing with such a company whose future looked uncertain at best.
Learnings From Investment Will be Applied
Taylor stated that it would be unwise for OTPP to rush into another crypto investment based on what happened with FTX: “We’ve had some learnings from the investment.” He added that these learnings will be applied going forward before committing funds again.
Conclusion
OTTP is staying away from cryptocurrency investments as a result of their experience with FTX and feedback received from members who are regretful about any losses incurred as a consequence of this decision. They have taken onboard learnings which will be applied before committing further funds in order to avoid a similar situation arising again in future investments made by OTTP.