Wisconsin Pension Fund Sells $300 Million Bitcoin Stake Amid Trade Tensions

The State of Wisconsin Investment Board (SWIB) has sold its entire $300 million stake in BlackRock’s iShares Bitcoin Trust (IBIT) during the first quarter of 2025, as revealed in a recent 13F filing with the U.S. Securities and Exchange Commission. This move comes at a time of significant market uncertainty, driven by escalating U.S.-China trade tensions and sweeping tariffs imposed by the Trump administration.

The sale occurred just ahead of the March 31 reporting date for the end of the first quarter, and two days before the so-called ‘Liberation Day’ on April 2, 2025. This date marked the imposition of comprehensive tariffs affecting nearly all of the U.S.'s major trading partners. The filing confirms that SWIB sold its Bitcoin ETF holdings before this critical date, indicating a strategic decision to liquidate its position amidst growing market volatility.

The broader economic landscape shifted dramatically following President Donald Trump’s inauguration, which initiated an aggressive new trade policy aimed at reshoring manufacturing on U.S. soil and spurring domestic growth. The administration announced 25% tariffs on goods from Canada and Mexico and a 10% tariff on Chinese imports on February 1. Two days later, the Canada and Mexico tariffs were paused for 30 days, though the 10% tariff on China took effect on February 4. By February 11, President Trump reinstated a 25% tariff on steel imports and raised the tariff on aluminum to 25%. Trade pressure ramped up on March 4, when the U.S. increased tariffs on China to 20%.

The tit-for-tat policy spiral of tariffs led to significant market instability. The crypto markets were not left unscathed, with Bitcoin falling to around $83,200 and Ethereum dropping to two-year lows as trade fears grew. Amid a retaliatory spiral, U.S. tariffs on Chinese goods surged to 145%, while China raised tariffs on U.S. products to 125%, sending Bitcoin below $75,000. Tensions began to ease in May when the U.S. and China temporarily reduced tariffs. The U.S. lowered its rate on Chinese goods to 30%, while China reduced its tariff on U.S. imports to 10%. As of mid-May, President Trump has also paused most reciprocal tariffs on other countries.

The sale of the $300 million stake in BlackRock’s Bitcoin ETF by the Wisconsin Pension Fund highlights the impact of geopolitical tensions on investment decisions. The fund's decision to liquidate its position amidst rising trade tensions and market volatility underscores the need for prudent risk management in the face of uncertain economic conditions. The move also reflects the broader market sentiment, where investors are increasingly cautious about the potential impact of trade policies on asset prices. As the economic landscape continues to evolve, pension funds and other institutional investors will need to remain vigilant and adapt their strategies to navigate the challenges posed by global trade dynamics.