Why Vanguard and State Street are Not Interested in Bitcoin ETFs
Despite the buzz around Bitcoin exchange-traded funds (ETFs), two major players in the industry, Vanguard and State Street, are choosing to stay out of the race. Both companies have decided not to introduce spot Bitcoin ETFs or any other cryptocurrency-related products.
Vanguard believes that cryptocurrencies lack intrinsic economic value and generate no cash flows. The high volatility of cryptocurrencies also goes against their goal of helping investors generate positive returns over the long term.
State Street, on the other hand, has not provided a specific reason for their decision. However, the company is known for its $57 billion SPDR gold stock (GLD), the largest commodity ETF backed by stored gold bullion.
While Vanguard and State Street opt out, the U.S. Securities and Exchange Commission (SEC) is likely to approve the launch of spot Bitcoin ETFs. The SEC is currently engaged in discussions with companies that have applied for these ETFs, with a decision expected between January 5 and 10.
Hot Take: Will Other Institutions Follow Suit?
With Vanguard and State Street staying away from Bitcoin ETFs, it raises questions about whether other institutions will also choose to sit out on this opportunity. While some see potential in cryptocurrencies, others remain cautious due to their lack of intrinsic value and high volatility.
The SEC’s decision on spot Bitcoin ETFs will have a significant impact on the market. If approved, it could attract more institutional investors and potentially lead to increased adoption of cryptocurrencies. However, if rejected, it may dampen enthusiasm and slow down the progress of Bitcoin ETFs.
Only time will tell how this plays out and whether more institutions will follow Vanguard and State Street’s lead in staying away from Bitcoin ETFs.
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