Harvard’s $56.9 billion endowment makes first foray into Ethereum Last quarter, even though it scaled back its investment in Bitcoin .
According to an SEC filing, Harvard Management Company (HMC) purchased nearly 3.9 million shares of BlackRock’s iShares Ethereum Trust (ETHA) worth approximately $86.8 million.
The company also reduced its stake in iShares Bitcoin Trust (IBIT) by 21%, selling approximately 1.5 million shares. The Bitcoin exchange-traded fund remains Harvard University’s largest publicly disclosed holding, at $265.8 million.
The shift came after Bitcoin prices retreated from an all-time high of around $125,000 in October to close the quarter just below $90,000.
However, Damped Spring Advisors founder and chief investment officer Andy Constan said the move may have less to do with market sentiment and more to do with market dynamics.
The sale likely reflects the unwinding of a deal that aimed to leverage Bitcoin Finance to trade at a premium to the value of its Bitcoin holdings, measured as a multiple of net asset value (mNAV), which compares enterprise value to the value of Bitcoin.
When Bitcoin prices soared, digital asset treasury (DAT) companies like Strategy (MSTR) traded at a premium to the value of the Bitcoin in their treasuries. For example, MSTR was trading close to 2.9 mNAV at one point, meaning investors buying the stock would have to pay around $2.9 to own $1 of BTC.
This premium reflects not only the underlying cash-generating business, but also the company’s potential to accumulate Bitcoin. Still, many investors are betting that the mNAV gap will close. They hold Bitcoin indirectly through IBIT and short shares of Strategy and similar Digital Asset Treasury (DAT) companies.
Then, according to Constant, relaxation began. As the price of Bitcoin plummeted, so did the price of DAT stock. For example, this strategy is currently trading at 1.2 mNAV. These traders may also be rebalancing their portfolios, he wrote on
Data from 13F’s SEC filings gathered by Todd Schneider at 13.info supports these sentiments. The report showed that institutions reported holding 230 million IBIT shares in the fourth quarter, down from 417 million shares in the third quarter.
Harvard has also increased investments in chipmakers Broadcom and TSMC, Google parent Alphabet and rail operator Union Pacific, while trimming stakes in Amazon, Microsoft and Nvidia.