Norges Bank lost $400M as US tech stocks fell, exposing the risk of concentrated positions.

Key takeaways:

Norges Bank, Norway’s $1.7 trillion sovereign wealth fund, reported a $40 billion loss in the first quarter of 2025.

The bank’s indirect Bitcoin exposure via stocks reached $356 million by the end of 2024.

Abu Dhabi's $437 million spot Bitcoin ETF stake shows sovereign wealth funds see Bitcoin as a hedge.

Norges Bank, commonly known as the Norges Bank Investment Management, reported a first-quarter loss of $40 billion, with most of the decline caused by a drop in the value of US-listed technology companies.

The bank’s investments generated $222 billion in profits in 2024, and its stock market portfolio dropped by only 1.6% in the first quarter.

Norges Bank is “mainly index-driven,” according to CEO Nicolai Tangen, who explained that the fund is following the FTSE Global All Cap Index.

This index includes over 7,100 stocks from both developed and emerging markets and is based on market capitalization, which means 65% of the exposure is to North American companies.

However, according to Norges Bank Deputy CEO Trond Grande, there is some flexibility for active investment, and their exposure to US-listed tech stocks has been lower than the benchmark for the past 18 months.

Some of these holdings, such as Strategy, Mara Holdings, Coinbase, and Riot Platforms, have large amounts of Bitcoin (BTC) in their balance sheets.

As a result, even if not intentional, the sovereign wealth fund had a $356 million indirect exposure to Bitcoin by the end of 2024.

"We have no mandate to buy crypto. We can buy an ETF, but we are not planning to do so," Tangen told reporters in May.

Norges Bank sold all of the central bank’s gold by early 2004, when the metal was trading below $400. Since then, gold has outperformed the S&P 500 by 280%.

Equities now make up 71.4% of the fund’s total investments, so if the global trade war continues, it could lead to significant losses for the fund.

Could the bank increase investments in Bitcoin-related companies or even buy spot Bitcoin exchange-traded funds (ETFs) as a way to hedge risk in such times?

Technically, it seems unlikely that Norges Bank could buy into the spot Bitcoin ETF without changing the fund’s mandate. However, increasing exposure to companies with significant Bitcoin holdings appears possible.

Still, there is no sign of such a move, although Nicolai Tangen stated on April 24 that the fund will increase investments in US stocks.

The fact that Mubadala Investments, one of Abu Dhabi’s sovereign wealth funds, held a $437 million stake in BlackRock’s iShares Bitcoin ETF (IBIT) helps build a case for such investment. Similarly, the State of Wisconsin Investment Board held $321 million in spot Bitcoin ETFs, showing the growing use of cryptocurrency as a hedge.