The Caisse de dépôt et placement du Québec has made its first cryptocurrency investment, joining growth equity fund WestCap as lead investors in a US$400 million round for Celsius Network that values the cryptocurrency-lending platform at US$3 billion. Here’s what you need to know:

What Celsius does: The company offers interest on cryptocurrency deposits, advertising rates as high as 17 per cent. It also lets customers take out loans against their cryptocurrency holdings. Such services can be valuable to people who find themselves unable to qualify for traditional loans despite amassing significant crypto wealth.

Why the deal matters: The Caisse isn’t the first pension fund to invest in crypto—last month two public pension funds in Virginia announced plans to increase their exposure to digital assets. But announcements like these are rare in the pension world, and rarer still among mainstream Canadian financial institutions. To date, Canadian banks have limited their involvement in crypto and blockchain to a handful of announced initiatives in identity verification, loyalty programs and carbon offsets. Regulatory uncertainty and volatility contribute to the hesitancy.

About that regulatory uncertainty: The U.S. is in the midst of a regulatory crackdown on the crypto sector and Celsius has been the subject of enforcement activity over alleged securities violations in four U.S. states. BlockFi, a competitor that also offers cryptocurrency accounts that bear interest, was hit by similar actions from five U.S. states in July. Coinbase dropped a planned lending product last month after pushback from the U.S. Securities and Exchange Commission. Celsius did not respond to a request for comment about the regulatory action, but the crypto lender told the Financial Times that it’s fully compliant with U.S. law. In an email to The Logic Tuesday, Caisse chief technology officer Alexandre Synnett said the fund analyzes every prospective investment rigorously. “We believe this industry requires regulation to shape its practices and protect consumers – and we intend to promote this through our investment by collaborating with Celsius and WestCap around a constructive dialogue with regulators,” he said.

Not your grandmother’s Caisse: The investment isn’t completely out of character for Quebec’s public pension fund manager. As my colleague Martin reported, the fund has shown a willingness to take on riskier bets under Thomas Birch, its head of global venture capital and technology. “We consider this an appropriate time to invest in this new asset class by adopting a thoughtful approach and working with our partners towards regulation of the industry. Furthermore, this investment will help diversify our assets in the traditional financial sector and position ourselves in the burgeoning fintech sector,” Synnet said. In another first for a Canadian institutional investor, it recently announced plans to divest from oil production and exploration.