The information contained in this article is for informational purposes only and to serve as a basis for discussion. It is not intended to be, and should not be construed as, financial or investment advice or a recommendation or solicitation to buy or sell any cryptocurrency or other digital asset.

In October 2024, a UK defined benefit (DB) pension fund made history by allocating 3% of its portfolio to Bitcoin. While modest in size, this remains the highest percentage allocation by any pension fund globally.

For comparison, the State of Wisconsin Investment Board (SWIB) invested approximately 0.1% of its $156 billion portfolio into spot Bitcoin ETFs in 2024, a move notable for its scale in dollar terms, but far smaller in relative exposure and critically, not a direct investment in Bitcoin itself.

Working with their investment consultant, the UK trustees took a pioneering step that was unthinkable just a few years ago. One year on, what have we learned from this landmark decision?

Why would a pension fund invest in Bitcoin?

The scheme in question faced familiar challenges: a weak employer covenant, a relatively immature membership profile and a long time horizon before buyout. Like many UK pension schemes, it needed assets that could deliver growth while controlling risk and volatility.

When sovereign bonds were frozen in 2022 following Russia’s invasion of Ukraine, trustees and consultants alike began to rethink the very concept of “risk-free” assets. Alongside gold, Bitcoin emerged as a candidate offering zero counterparty risk, diversification and asymmetric return potential.

Is Bitcoin risky for pensions or a new source of resilience?

The allocation was underpinned by detailed modelling and strict governance. At best, the decision had the potential to bring the scheme’s buyout horizon forward by as much as two years. Importantly, even in more challenging scenarios, the impact on long-term objectives was negligible, demonstrating a resilient risk/return trade-off.

Portfolio volatility was estimated to rise by only 2% and a clear rebalancing framework was built in to capture profits systematically, removing emotional decision-making. In other words, this was not speculation; it was a carefully engineered strategy designed to maximise potential upside while preserving long-term stability.

How do pension funds buy Bitcoin securely?

Delivering the allocation required the right ecosystem. Cartwright led the trustee engagement and design, Onramp provided specialist Bitcoin custody and Zodia Markets acted as the on-ramp trading partner, ensuring assets could be transferred securely and efficiently from the trustee’s bank account into Bitcoin.

With our bank-backed heritage, FCA registration and deep multi-currency capabilities, Zodia Markets provided the standards of execution and settlement that institutions expect. For trustees, this was vital reassurance.

What has the first UK pension fund Bitcoin investment achieved so far?

The allocation remains a long-term strategy, but its early performance has already demonstrated the value of diversification. Between 23rd October 2024 and 3rd October 2025, the pension fund’s 3% allocation to Bitcoin rose by 76%, materially enhancing the scheme’s overall return profile.

For context, over the same period:

• Gold increased in value by 37%,
• Global Equities (FTSE AW) increased in value by 15%

This illustrates why even a modest Bitcoin allocation can improve outcomes. It has outperformed traditional hedges such as gold and provided resilience where bonds have struggled, all while leaving the scheme’s broader strategy intact. Most importantly, it has shown that trustees can integrate Bitcoin responsibly, transparently and in full alignment with regulatory frameworks.

Could more UK pension funds invest in Bitcoin?

There are around 500 DB trusts in the UK alone, many with similar challenges and horizons. For those willing to look beyond traditional asset classes, Bitcoin may play a legitimate role. One year on, this pioneering step has proven that pension funds can approach digital assets with the same discipline, governance and foresight they apply elsewhere.

At Zodia Markets, we are proud to have played a role in enabling this strategic evolution. As more institutions explore digital assets, our mission remains the same: to provide the trusted, regulated infrastructure that gives confidence to first movers – and those who choose to follow.