University of Michigan Boosts Investment in Cryptonetwork Fund

(Bloomberg) -- The University of Michigan’s $12 billion endowment plans to add money to a cryptonetwork technology fund managed by Andreessen Horowitz as more institutional investors begin to explore the market for cryptocurrencies.

Andreessen Horowitz, a Menlo Park, California-based venture capital firm, would receive an additional investment from the endowment to its CNK Fund I, according to the university’s agenda for the Feb. 21 Board of Regents meeting. The endowment committed $3 million in June and didn’t specify the amount it plans to invest.

CNK invests in “cryptonetwork technology companies across the spectrum of seed, venture and growth stage opportunities,” Kevin Hegarty, chief financial officer at the public university, wrote in the agenda.

Pensions and endowments have been tepid about the 10-year-old, $120 billion crypto-asset universe, largely due to its market manipulation and a lack of regulation. That’s starting to change. Two Virginia pension funds committed to crypto investments last week, adding to a list of institutions dipping into the asset class, including Yale University’s $29.4 billion endowment.

While the crypto space presents challenges and a high degree of risk, it’s worthwhile for institutional investors to begin exploring the area for the long term, according to a research note published Feb. 18 by pension and endowments adviser Cambridge Associates.

©2019 Bloomberg L.P.