For good measure, Mass Mutual also acquired 5% in NYDIG, the bitcoin-dedicated financial services firm.

U.S.-based mutual firm The Massachusetts Mutual Life Insurance Company plunked down $100 million to buy bitcoin for its general investment account, according to the Wall Street Journal. (CryptoPotato)

The $100 million investment is chump-change for Mass Mutual, given that it held about $235 billion in its general investment account as of September 30. But the more important takeaway from the news is the growing adoption of bitcoin, the leading cryptocurrency, by institutions.

The rationale for the investment

Mass Mutual said it wanted to achieve diversification and to take advantage of new opportunities. The bitcoin investment would provide “measured yet meaningful exposure to a growing economic aspect of our increasingly digital world,” the firm said.

The action by Mass Mutual follows a spate of corporate and institutional investments in bitcoin triggered by a $250 million bet by business intelligence firm MicroStrategy (NASDAQ: MSTR) in August. The company scaled up on that investment with additional tranches of $175 million and $50 million in subsequent months. Earlier this week it said it will issue $400 million of convertible notes and invest the same in bitcoin.

Square (NYSE: SQ) also put in $50 million in bitcoin. Meanwhile, users of Square’s Cash App have been active players in the cryptocurrency.

PayPal (NASDAQ: PYPL) made crypto available on its platform, and its announcement was a highly bullish factor in the current uptrend in bitcoin.

Bitcoin touched a high of $19,835 in November, taking out its previous high made in 2017.

Investment bankers such as JPMorgan (NYSE: JPM) have said bitcoin would outperform gold given that it is scarcer, and more sought after by a younger generation of investors.

NYDIG

Mass Mutual effected its $100 million bitcoin purchase through New York-based fund manager NYDIG.

NYDIG founder and executive chairman Ross Stevens said that other insurance companies have been investing in bitcoin through his firm and that many more are sending out feelers of interest.

With the stellar returns provided by bitcoin this year, that’s not surprising:

1 month               +9.84%

3 month               +73.20%

1 year                   +146.71%

YTD                        +148.48%

(Data according to MarketWatch/Coindesk)

Mass Mutual fund also acquired a 5% stake in NYDIG.

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