- While its rivals like BlackRock and Fidelity have dived into the Bitcoin ETF market, Vanguard has taken a different approach and has even taken down its BTC futures ETF offering.
- The company says that these products don’t align with its focus on assets such as stocks and bonds, which it believes are the building blocks of a well-balanced portfolio.
While every other Wall Street giant is rushing to offer its clients access to a Bitcoin spot ETF, one of the mainstays of the ETF industry is shunning the sector altogether. Vanguard has refrained from offering the spot ETFs and has even taken down the futures ETFs in a move it says is to align with its ethos of a well-balanced investment portfolio.
Users of a Vanguard retirement brokerage account who attempted to invest in the spot ETFs were hit with a warning that the trade couldn’t be completed.
“Buy orders are not currently accepted for this security. Securities may be unavailable for purchase at Vanguard due to some variables including regulatory restrictions, corporate actions, or various trading and/or settlement limitations,” stated the warning.
A spokesperson for the company later clarified that the decision was to insulate the users against products that don’t fit its criteria for asset consideration. In a statement, the spokesperson told media outlets:
While we continuously evaluate our brokerage offer and evaluate new product entries to the market, spot Bitcoin ETFs will not be available for purchase on the Vanguard platform. We also have no plans to offer Vanguard Bitcoin ETFs or other crypto-related products.
The statement added that the asset manager’s view is that “these products do not align with our offer focused on asset classes such as equities, bonds, and cash, which Vanguard views as the building blocks of a well-balanced, long-term investment portfolio.”
Vanguard Says No to Bitcoin ETFs
Vanguard’s stance is contrary to almost every other major asset manager on Wall Street. The company is the second-largest asset manager in the world with $7.2 trillion in assets under management and one of two top players in the ETF sector.
However, the move isn’t unexpected. Vanguard is known for being one of the most conservative asset managers on Wall Street. It has a history of shying off from any product it considers risky and sticks to the ‘boring’ but tested products. In 2019, for instance, it stopped offering leveraged and inverse ETFs, despite all its rivals going all in.
Vanguard’s biggest rival is BlackRock, a company that is now a leader in the Bitcoin ETF space. BlackRock, which has $9.1 trillion in AUM, was among the 11 companies whose ETFs the SEC approved on Jan. 10. The iShares Bitcoin Trust (IBIT) recorded over a billion dollars in trading volume on Thursday, the second-highest BlackRock ETF trading volume on the first day after the U.S. Carbon Transition Readiness ETF in 2021.
Vanguard’s move is unlikely to change, however. The company was founded on a contrarian philosophy by Jack Bogle in 1975.
“This change allows us to focus on offering a core set of products and services consistent with our commitment to serve the needs of long-term investors,” the spokesperson told Axios.
