Vanguard opted against offering its users access to Bitcoin ETFs, which began trading on Thursday 11th, after being approved on Wednesday 10th.
Vanguard’s decision faced massive backlash from its users. Some clients have chosen to close their brokerage accounts and transfer their funds to other platforms. Let’s explore more about this news.
Vanguard Stands Against Bitcoin ETFs, Prompting User Responses
Vanguard reportedly claimed that spot Bitcoin ETFs do not align with its traditional offerings. The firm explained in a statement to the Wall Street Journal: “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.”
🚨NEW: @Vanguard_Group, the world’s second largest asset manager behind @BlackRock, is reportedly blocking its customers from buying into the new $BTC Spot ETFs, saying the products “don’t fit with Vanguard’s investment philosophy.”
Now we’ll start to see how institutional… https://t.co/LmZodeYyad
— Eleanor Terrett (@EleanorTerrett) January 11, 2024
Some crypto enthusiasts who have Vanguard accounts expressed dissatisfaction with Vanguard’s stance on cryptocurrency. Many decided to use the company’s more crypto-friendly rivals.
Just fully transferred my retirement account from @Vanguard_Group to @Fidelity because Vanguard won't support Bitcoin ETFs, and appears to be manipulating the price of Bitcoin by only allowing people to sell GBTC, not buy.
It's easy, takes just 5 mins. pic.twitter.com/DnzzYu1YPl
— Vanessa Harris (@technologypoet) January 11, 2024
Another user switching their Roth 401(k) funds from Vanguard to Fidelity is Yuga Cohler, senior engineering manager at Coinbase. Cohler explained that his investment philosophy does not align with Vanguard’s “paternalistic blocking of Bitcoin ETFs. In addition, Bitcoin analyst Neil Jacobs stated he is also in the process of pulling out of Vanguard. He stated that the asset manager made a “terrible business decision.”
Await Introduction by Other Players in the Market
Reports have confirmed that clients of investing firms Citi, Merill Lynch, Edward Jones, and UBS reported they were also unable to buy spot Bitcoin ETFs on those platforms.
BREAKING: Bank of America owned Merrill Lynch, joins Vanguard in denying customers access to spot Bitcoin ETFs – Fox News
Close your account! pic.twitter.com/cEGRLehK1u
— Bitcoin Archive (@BTC_Archive) January 11, 2024
Fox Business reporter Eleanor Terrett, citing an unknown source, claims that Merrill Lynch is holding off on offering the purchase of Bitcoin products until it can determine whether the spot Bitcoin ETFs trade efficiently.
Interestingly, Bitcoin ETFs made an impressive start on their first day of trading. Reports note that Bitcoin ETFs traded over $4 billion on Thursday, reflecting interest in the product.
