South Korea’s Pension Fund Faces Crypto Losses Amid Market Drop

The National Pension Service (NPS) of South Korea, recognized as the third-largest public pension fund globally with assets exceeding $1 trillion, has experienced significant losses following an increase in its investment in Strategy Inc (MSTR) during the last quarter of 2025. This period coincided with a notable decline in Bitcoin’s value, plummeting from a peak around $126,000 to approximately $88,000.

As of the latest figures, the value of Bitcoin has further decreased to about $67,000, leading to worsening losses for the pension fund. All four cryptocurrency-related stocks within the NPS portfolio have also seen substantial declines from their values at the end of 2025.

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A recent 13F filing submitted to the U.S. Securities and Exchange Commission outlines that the NPS held 614,409 shares of Strategy by December 31, 2025, an increase from 511,640 shares at the close of the third quarter, marking an addition of 102,769 shares. By the quarter’s end, this position was valued at roughly $93.4 million.

Strategy Inc, known for being the largest corporate Bitcoin holder globally, possesses 717,722 BTC acquired at an average cost of $75,950 per coin. Consequently, Strategy’s stock serves as a leveraged indicator of Bitcoin’s price, and it has similarly declined significantly. Currently, Strategy’s shares have dropped by 75% from their all-time high of $457 recorded in November 2024 and are considered the most shorted stock on Wall Street, according to Goldman Sachs.

The NPS initially invested in Strategy in the second quarter of 2024, acquiring 24,500 pre-split shares at an estimated value of $34 million. Since then, the fund has continued to expand its holdings over multiple quarters.

This diminishing value from the second to the fourth quarter, which saw a decline from $205 million to $93 million despite an increase in shares, reflects the substantial drop in Strategy’s stock price.

In addition to Strategy, the NPS maintains a diverse portfolio of crypto-related stocks, comprising four companies. As of year-end, these included:

Stock Shares Q4-End Value Current Price Est. Current Value

Strategy (MSTR) 614,409 $93.4M $133.40 ~$82.0M

Robinhood (HOOD) 1,970,461 $222.9M $79.45 ~$156.5M

Coinbase (COIN) 298,117 $67.4M $181.06 ~$54.0M

Block (XYZ) 833,124 $54.2M $54.53 ~$45.4M

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Total ~$437.9M ~$337.9M

Overall, the combined value of this portfolio peaked at approximately $608 million at the end of the third quarter of 2025, but has since diminished to an estimated $338 million, representing a decline of around 44% over five months.

Despite the losses, Robinhood remains the largest position by value in this portfolio, despite a 30% drop since the end of 2025.

Interestingly, the NPS has stated that its holdings in cryptocurrency-related stocks are not strategic bets on digital assets. In response to inquiries from the Korean National Assembly, the fund clarified that it does not regard virtual assets as targets for investment. The rationale behind these positions lies in their inclusion within the MSCI benchmark index that the NPS adheres to for its international equity allocations.

The crypto-stock investments represent around 0.25% of NPS’s $135 billion U.S. equity portfolio, a minor fraction relative to the fund’s total assets exceeding $1 trillion.

However, the political climate in South Korea is shifting. Both major political parties during the 2025 presidential elections endorsed allowing the NPS to engage in direct investments in digital assets, a significant change from the fund’s previous policies. Moreover, South Korea’s financial regulator has initiated measures to permit corporate involvement in cryptocurrency markets, signaling a potential expansion of institutional participation.

As it stands, with 614,409 shares in Strategy, the NPS has indirect exposure to an estimated equivalent of 1,800 BTC. This association ties its financial performance to an asset class that the fund claims it does not actively invest in.

Looking ahead, Strategy’s Executive Chairman, Michael Saylor, has been consistently purchasing Bitcoin regardless of market conditions, with his company achieving its 100th purchase by late February 2026. Currently, with its market-adjusted net asset value falling below 1.0, the stock trades at a discount relative to the Bitcoin it holds on its books. Saylor has made clear that he does not plan to divest.

The future for NPS raises questions about whether it will continue to passively accumulate additional shares at reduced prices or consider a rebalancing strategy that could lead to a decrease in investments. The next 13F filing detailing Q1 2026 is anticipated by mid-May, which will provide further insight into the fund’s direction.