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Vanguard has blocked customers from buying cash bitcoin exchange-traded funds (ETFs) on its platform, and some are now threatening to move their funds to competitors.
The $7.2 trillion asset manager, the world's second largest after BlackRock, said it has no plans to offer btc ETFs or allow clients to purchase the product on its platform.
The investment product does not align with the company's focus on “asset classes such as stocks, bonds and cash, which Vanguard views as the building blocks of a well-balanced long-term investment portfolio,” he told bitcoin-etfs-on-its-platform-ZTqcqY5ISZsOZkjiJnxC” target=”_blank” rel=”noopener”>Wall Street Journal.
The move sparked criticism from customers. Tony Spencer told X that a company spokesperson told him he couldn't buy the product because it didn't align with his investment philosophy.
Wow. It's worse than she thought. I called and the response I received was “We are not currently allowing them to be purchased because it does not fit with Vanguard's investment philosophy.”
Me: “Okay, but you let me buy GBTC in the past.”
Him: “Yeah, I think you can only sell that now.”
—Tony Spencer (@notsleepy) January 11, 2024
Yuga Cohler, Coinbase Engineer saying will move his eight years of 401K savings from Vanguard to Fidelity. Cohler criticized Vanguard's decision to block btc ETFs, calling it “paternalistic.”
bitcoin ETF Blocking Shows crypto Skepticism on Wall Street
“crypto skepticism is still alive and well on Wall Street,” Fox Business reporter Eleanor Terett said in response to Vanguard's decision to block bitcoin ETFs.
NEW: @Vanguard_Groupthe world's second largest asset manager behind @BlackRockis allegedly preventing its customers from buying the new $btc Spot ETF, saying the products “do not fit Vanguard's investment philosophy.”
Now we will begin to see how institutional… https://t.co/LmZodeYyad
-Eleanor Terrett (@EleanorTerrett) January 11, 2024
Despite launching its own btc ETF, Fidelity issued a disclaimer to users trying to purchase shares, reminding them that the ETF is subject to a “Designated Investment Agreement.” Users must recognize that they are experienced investors with a high risk tolerance.
JPMorgan also warns clients who want to buy BlackRock's iShares bitcoin Trust ETF (IBIT) that it is a high-risk asset. JPMorgan is an approved participant in BlackRock's IBIT ETF
JPMorgan interface throws this warning when you try to buy BlackRock $IR btc ETFs.
We get it, JPM, the boss hates bitcoin for political reasons, but you're also named an authorized participant in the BlackRock offering, so accept your fate already. pic.twitter.com/GRja1q24Wx
– Dan McArdle (@robustus) January 11, 2024
Despite Vanguard opting out, bitcoin spot ETF trading got off to a flying start on January 11, with volume reaching around $4.6 billion and BlackRock raising over $1 billion of that amount.
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