Fact Check: How Much Did the University of Chicago Lose in Cryptocurrency Trading?

Author: Darren Terminator

Recently, Jiemian News took the opportunity of the publication of the third edition of Professor Zhao Dingxin's "Lectures on Society and Political Movements" (the second edition of this book is truly excellent) to interview Professor Zhao. In the interview, Professor Zhao stated that the recent budget cuts at the University of Chicago are due to "it is said that the university seems to have listened to some Nobel laureates' investment advice and lost over six billion dollars in cryptocurrency speculation. It can be said that the reduction in the humanities at the University of Chicago has nothing to do with Trump's policies."

So did the University of Chicago really lose over six billion dollars in cryptocurrency speculation?

Coincidentally, in the Q&A updated by the University of Chicago in December 2025[1], the issue of cryptocurrency speculation was mentioned. According to the official website, "Contrary to what is stated in a news report, the University of Chicago has not suffered losses in cryptocurrency investments. Our investment in cryptocurrency is relatively small, but it has more than doubled over the past five years. Our investment goal is to provide a stable source of income to support our various projects in the long term and ensure the university's future."

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So does that mean the provost of the University of Chicago is definitely telling the truth?

Hard to say. However, judging by intuition, the total amount of donations to the University of Chicago over the past five years is around ten billion dollars (the fiscal year 2021 was a record high, about 11.6 billion dollars; the fiscal year 2025 is about 10.9 billion[2]). Unless the University of Chicago is truly insane enough to use at least 60% of its endowment to speculate in cryptocurrency (which obviously violates various regulations), or misappropriates a large amount of operating funds for cryptocurrency speculation and loses it all, it should not have lost as much as six billion dollars.

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So how much did they actually lose? Or is it really as the official Q&A states, that they made a fortune?

The Stanford Daily[3], Financial Times[4], and Investopedia[5] reported on this matter last year. According to the Stanford Daily, four of their sources indicated that "the University of Chicago lost tens of millions of dollars due to investments in cryptocurrency around 2021."

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So what does the financial report of the University of Chicago[6] say?

Unfortunately, the financial report does not directly tell us how much was lost in cryptocurrency speculation. However, in the fiscal year 2022 financial report, the University of Chicago disclosed its investment in cryptocurrency (fair market value): approximately 64 million dollars as of the end of June 2021, and about 45 million dollars as of the end of June 2022 (a difference of about 19 million dollars). In subsequent financial reports, perhaps due to making a profit or suffering losses, the University of Chicago changed its accounting method and no longer disclosed its cryptocurrency investments. However, according to the Q&A in 2025, the University of Chicago is still relatively cautiously investing in cryptocurrency.

It is worth noting that the 2022 financial report shows that as of the end of June that year, the total loss from the university's endowment investments was as high as about 1.5 billion dollars. The 2023 financial report indicated that the University of Chicago only had a small loss on its investments. In the following two years, the University of Chicago turned a profit.

However, we do not know how much of these losses and profits came from cryptocurrency speculation. The Stanford Daily provided a somewhat unreliable clue: "[The University of Chicago's] target asset allocation shows that the ideal allocation ratio for the university's investments in private debt and 'absolute return' investments (which include alternative assets such as cryptocurrency) has decreased from 25.5% in 2020 to 20% in 2022, indicating a significant withdrawal (or decline) from high-risk alternative assets."

However, the Stanford Daily also provided an interesting observation: "From 2013 to 2023, the annualized return rate of the University of Chicago's endowment fund was only 7.48%, while the annualized return rate of the stock market during the same period was 12.8%, and the average level of Ivy League schools was 10.8%. If the University of Chicago had simply followed market performance, its endowment fund would now have an additional 6.45 billion dollars. Moreover, this (dream) fund would be more than enough to pay off all the school's debts. Of course, universities cannot simply replicate market indices, as they must hedge during economic downturns to maintain financial stability. But even if the University of Chicago only achieved the average level of its Ivy League peers, its endowment fund would still have an additional 3.69 billion dollars, which would be enough to cover the school's current budget deficit for the next 15 years."

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However, besides cryptocurrency speculation and investment losses, what other reasons could explain the budget cuts at the University of Chicago?

Common explanations, aside from labeling Trump as a rogue, often emphasize the university's own strategic missteps: borrowing and leveraging, extensive infrastructure projects, and aggressive expansion.[7][8] As of the end of June 2025, the University of Chicago's debt was about 9.2 billion dollars[9], approximately 90% of its endowment. Although the financing costs of these debts are relatively low, unlike across the ocean, the interest that the University of Chicago needs to pay this fiscal year still amounts to over 200 million dollars.

Such high debt certainly did not come from nowhere. Since the new century, the University of Chicago has spent heavily on new laboratories, libraries, dormitories, technology, etc., to enhance its prestige and enrollment, as well as to compete with various prestigious schools, and much of this expansion has been supported by substantial borrowing. However, the new infrastructure brings ongoing operational costs, and the university has not figured out how to sustain it long-term.

The Stanford Daily[10] quoted Professor Clifford Ando of the university, stating that any parents wanting to send their children to the University of Chicago need to consider whether the tuition they are paying is for their child's education or to cover the university's debts. The reckless expansion and the resulting debt issues are clearly the responsibility of the university's management, who have been overly ambitious and reckless. Ironically, between 2006 and 2022, the base salary of the president increased by 285%. Now, when faced with some economic problems, the management has shifted the difficulties onto students and general faculty: even in years of asset sales, layoffs, and enrollment freezes, senior salaries continue to rise.

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So what should the University of Chicago do next?

In addition to continuing to cut costs, it must also find new sources of revenue. Clearly, a common tactic used by American universities to increase revenue is to enroll more undergraduate students. The University of Chicago is going to do this as well, although the reasons given will surely be grandiose.

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[1]https://provost.uchicago.edu/actions-budget

[2] In this article, the budget, endowment, and debt of the University of Chicago are calculated as a combined total for the main campus, medical center, and marine biological laboratory. Common news reports (especially the university's own press releases) usually combine figures for the endowment but only calculate the main campus for debt.

[3]https://stanfordreview.org/uchicago-lost-money-on-crypto-then-froze-research-when-federal-funding-was-cut/

[4]https://www.ft.com/content/4501240f-58b7-4433-9a3f-77eff18d0898?utm_source=chatgpt.com

[5]https://www.msn.com/en-us/money/careersandeducation/university-s-investment-losses-spark-outrage-resulting-in-drastic-program-cuts/ar-AA1Nxhgx

[6]https://intranet.uchicago.edu/en/tools-and-resources/financial-resources/accounting-and-financial-reporting/financial-statements

[7]https://www.wsj.com/us-news/education/colleges-face-a-financial-reckoning-the-university-of-chicago-is-exhibit-a-8918b2b0

[8]https://www.ft.com/barrier/corporate/d5c7c0f4-abf1-4469-8dca-87ff01cbebf6

[9] The debt of the main campus is about six billion dollars. Perhaps this is the source of Professor Zhao's six billion dollars.

[10]https://chicagomaroon.com/40486/news/uchicago-professor-sounds-alarm-over-troubling-university-finances/