Vanguard CEO Reiterates Stance Against Bitcoin ETF
In a recent video release, Vanguard CEO Tim Buckley emphasized the company’s decision to refrain from offering a spot Bitcoin ETF. This comes as no surprise, considering Vanguard’s well-known anti-crypto stance and its position as the second-largest asset manager globally.
Following the SEC’s approval of spot Bitcoin ETFs on January 10, Vanguard, along with Merrill Lynch, stood out by denying access to these new investment funds. This decision drew criticism from customers and industry figures like Cathie Wood, CEO of Ark Invest.
Bitcoin Deemed Too Volatile for Long-Term Investment
Buckley explained Vanguard’s opposition to Bitcoin ETFs, stating that the cryptocurrency is a speculative asset unsuitable for long-term investment and does not align with the company’s investment model. He pointed out that Bitcoin’s value declined alongside the stock market crash, highlighting its volatility and lack of stability as a store of value.
“Something like bitcoin is just too volatile and it’s not a store of value. It hasn’t been and it’s very volatile. When stocks got hammered in the recent crisis, bitcoin went right with them. And so it is speculative. Really tough to think about how it belongs in a long-term portfolio.”
Vanguard prefers to invest in assets with tangible “underlying cash flow,” such as stocks or bonds, which Bitcoin currently lacks. Thus, Buckley reiterated Vanguard’s decision to abstain from offering spot Bitcoin ETFs unless there is a significant change in the cryptocurrency’s asset class.
Surging Demand for Bitcoin ETFs
Despite Vanguard’s conservative stance, other asset managers have embraced spot Bitcoin ETFs to provide diverse investment options for their clients. Cetera, a San Diego-based financial firm, recently announced the adoption of four BTC ETFs. Patient Capital, a $1.8 billion asset manager, has also petitioned the SEC for approval to convert up to 15% of its holdings to Bitcoin ETFs.
These developments are exciting for the crypto community as the launch of spot Bitcoin ETFs is expected to drive institutional demand for the leading cryptocurrency. In the last two months of trading, spot Bitcoin ETFs have gained a total net flow of $11.95 billion. Currently, Bitcoin is trading at $69,260.35 as it attempts a market rebound after a recent price correction.
Disclaimer: The information provided here does not constitute investment advice or financial advice in any way. Always do your own research and due diligence before making any investment decisions. Cryptocurrency investments are volatile and involve a high level of risk.
Hot Take: Vanguard Stands Firm Against Bitcoin ETF
Vanguard CEO Tim Buckley’s recent video release reaffirmed the company’s position against offering a spot Bitcoin ETF. Despite growing demand and the approval of these investment funds by the SEC, Vanguard remains skeptical due to Bitcoin’s volatility and lack of long-term value as a store of wealth.
While other asset managers are embracing spot Bitcoin ETFs to cater to their clients’ needs, Vanguard continues to prioritize assets with tangible underlying cash flow. This conservative approach aligns with their investment model and distinguishes them from industry players who have chosen to embrace cryptocurrency.
As the debate around Bitcoin ETFs continues, it will be interesting to see if other major asset managers follow Vanguard’s lead or opt for a more progressive stance in this evolving market.
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