The Impact of MassMutual's $100M Bitcoin Investment

MassMutual has announced that they have added $100 million of Bitcoin to their balance sheet, an investment that makes up approximately 0.04% of their total investment assets. This is massive news for Bitcoin, as MassMutual is a Fortune 100 life insurance firm, therefore experts in managing risk. In our opinion, this is one of the most important pieces of news for Bitcoin in 2020. With current factors such as massive QE and negative interest rates, MassMutual feels that Bitcoin is a safer play than many ‘traditional’ assets. 

MassMutual is the first of the big life insurance firms to enter the Bitcoin space. With that being said, it is safe to assume other key players in the space have this on their radar, or if they did not, they do now. Below is a table showing the impact of MassMutual and their competitors on capital inflows into Bitcoin if they followed suit, converting 0.04% of their total investment assets into Bitcoin. MassMutual has already invested $100 million, and if their top 4 competitors do the same, that would drive $616 million in additional capital into Bitcoin.

The news of MassMutual’s $100 million investment is only one day old, and this allocation could very well be increased moving forward. If they decided to increase their Bitcoin allocation to 0.10%, and competitors follow suit, investment inflows would reach over $1.61 billion. It is important to note that these figures only account for the top 5 firms, and does not include the ripple effect as smaller players also adjust their investment portfolios.

The firms in our model only account for 35.60% of the total market cap of the Life Insurance Sector. This leaves a large majority of the sector unaccounted for, and assuming that they follow similar actions to the largest players, this would drastically increase the total investments in Bitcoin. The Bitcoin Bull Market has only just begun.

*All financial data was sourced directly from each firm's financial statements. Market cap is based on direct premiums written, provided by the Insurance Information Institute*