Vanguard Bans Bitcoin ETFs from Platform
Vanguard, the second largest ETF provider after BlackRock’s iShares, has banned Bitcoin ETFs from its platform. Users reported that even the Grayscale Bitcoin Trust ETF (GBTC) is only sellable and no longer available for purchase on Vanguard. The company stated that Bitcoin does not align with its investment philosophy. This move may be an attempt to gain support among Democratic investors or politicians ahead of the upcoming US elections, as the Democratic Party seems to be against cryptocurrencies. Vanguard’s decision is notable considering the successful launch of new Bitcoin ETFs, particularly BlackRock’s IBIT, which saw a significant increase in BTC holdings and trading volume.
Platforms’ Decision to Stay Out of Bitcoin ETF Business
It is surprising that some platforms are choosing to stay out of the Bitcoin ETF business, especially since they earn commissions on trades. However, many platforms have not integrated the ability to purchase these ETFs due to technical limitations. While these ETFs are currently available on stock exchanges, it may take some time before brokerage platforms integrate them. It is possible that all stock investment platforms will eventually offer Bitcoin ETFs, except for Vanguard.
Competition Between BlackRock and Vanguard
BlackRock’s IBIT is quickly growing as a major player in the Bitcoin ETF market. On its first day of trading on Nasdaq, IBIT had traded over 37 million times and increased its BTC holdings from 228 BTC to 2,620 BTC. Its trading volume exceeded one billion dollars. On the other hand, Grayscale’s GBTC remains a dominant force with approximately 619 million BTC holdings worth about 28.6 billion dollars. While GBTC had a higher trading volume than IBIT on January 11th, it is possible that BlackRock’s IBIT may gain a significant market share over time.
Hot Take: Vanguard’s Anti-Bitcoin Stance
Vanguard’s decision to ban Bitcoin ETFs from its platform reflects its long-standing opposition to Bitcoin and similar sentiments to Warren Buffett. While other companies may eventually integrate Bitcoin ETFs, Vanguard seems determined to oppose the purchase of these financial products. The upcoming US elections and the Democratic Party’s stance against cryptocurrencies may have influenced Vanguard’s decision. However, it remains to be seen whether Vanguard will reverse its stance if Republicans win the elections. Regardless, the launch of new Bitcoin ETFs has been a resounding success, with BlackRock’s IBIT making significant gains in BTC holdings and trading volume.
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