Simply put
- The company is set to begin trading funds that include Bitcoin, Ethereum, XRP, and Solana, bringing them in line with other non-core assets that already accommodate cryptocurrencies.
- This decision follows several months of internal assessment and comes despite a general downturn in the market, as demand persists.
- Previously, Vanguard overlooked the impressive rise of the Spot U.S. Bitcoin ETF, which saw its assets grow from $25 billion in early 2024 to about $125 billion.
Vanguard is now opening its intermediary platform to ETFs and mutual funds focused on crypto, moving away from its longstanding practice of excluding digital asset products.
Starting Tuesday, the company will allow trading of funds holding Bitcoin, Ethereum, XRP, and Solana, treating crypto exposure similarly to other non-core assets, like gold, which it currently supports.
This move will grant over 50 million brokerage customers across the U.S. funds industry access to regulated crypto options.
The shift in strategy comes after an extended internal review and as interest in digital assets remains despite recent market declines.
The eleven Spot Bitcoin ETFs launched in early 2024 experienced significant inflows, quickly amassing around $25 billion in the first month alone. Vanguard chose not to participate, missing out as those assets surged to about $125 billion in less than two years.
BlackRock’s iShares Bitcoin Trust, the largest entity in that group, currently holds around $70 billion, down from a peak near $99.5 billion.
While cryptocurrencies make up only a small part of BlackRock’s $13.5 trillion in global assets under management, Vanguard manages approximately $11 trillion.
In July 2024, iShares veteran Salim Ramzi took over as Vanguard’s CEO.
Unlike his predecessor, Tim Buckley, and the broader company stance, Ramzi has publicly endorsed both Bitcoin and blockchain technology.
According to Bloomberg ETF analyst Eric Balciunas, this marks a historical first for Vanguard, as they appointed someone from outside the company to a significant role. Earlier this year, he expressed surprise at this choice.
Mr. Ramzi came from Vanguard’s largest rival and previously led iShares and index investing at BlackRock, where he was responsible for overseeing the IBIT’s application and logistics.
