Bitcoin could stabilize the value of pension schemes in France after President Emmanuel Macron revealed a plan in January 2023 to increase the retirement age for French pensioners from 62 to 64.
Today, protestors invaded the Paris branch of BlackRock, the world’s largest asset manager, in the latest snub to President Macron’s sweeping reforms that some claim only benefit rich companies.
French President Polarizes Workers as Government Looks to Recover Funds
The French government forced the approval of the new scheme on March 16, 2023, without a vote.
In addition to changing the retirement age, the new law consolidates all 42 schemes into a single points-based plan. This revised plan would reportedly simplify job transitions and interruptions. However, it will harm employees whose scheme offers better money and lower retirement age.
Knowing that the new reform would likely result in winners and losers, Macron sought to reframe its public perception through a lengthy national consultation. He said the plan would start in 2025 and transition fully across 15 years.
The French Pension Advisory Council estimates the reform will bring in $19.3 billion op the French government by 2030. Compensatory measures to smooth the transition to a higher retirement age and longer contribution period could exceed $4.9 billion.
While some fund managers, including Vanguard, maintain that Bitcoin’s long-term value proposition is weak, others have seen it as a safe haven asset that protects against currency devaluation retiring employees will likely face.
How Bitcoin Can Benefit Future French Pensioners
U.S. pension funds have generally erred on the side of caution when recommending crypto allocations, using them to boost returns without incurring significant losses.
Last year, Boston-based Fidelity announced that it would include Bitcoin in its 401(k) plans at the end of 2023. It would allow up to 20% of an employee’s pension fund to be allocated to crypto. Fidelity manages pensions for around 23,000 companies.
Cryptocurrency advocates see France‘s pension reform as an opportunity to spread Bitcoin adoption and follow in the footsteps of Fidelity Investments and ForUsAll, two prominent American pension fund managers.
Crypto entrepreneur Del Crxpto wrote that moving pension funds to Bitcoin within the next five years could mean that investors can retire at the original age of 62. Some argue that currency devaluation is enough reason to allocate a portion of funds to crypto.
Presently, pensioners stand to earn 1,400 euros per month after taxes. Based on an inflation rate of 3% per year, pensioners would need about 1,721 euros monthly to maintain the same standard by 2030 and 3,109 euros by 2050. This prediction is based on raw European Commission and the European Central Bank data.
On the other hand, Bitcoin is up over 70% compared to its Jan. 1, 2023, price of $16,600. It is currently trading at just under $28,200.
Bitcoin maxi Michael Saylor remains bullish on Bitcoin’s pedigree as a safe haven asset. MicroStrategy, the company over whose board he serves as Executive Chairman, recently bought an additional 1,045 BTC.
The latest purchase takes its holdings to above 140,000. MicroStrategy was one of the first U.S. firms to offer employees crypto allocations in their retirement portfolios.
For Be[In]Crypto’s latest Bitcoin (BTC) analysis, click here.
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