Vanguard, the asset management firm, recently made it clear that it won’t be entering the Bitcoin exchange-traded fund (ETF) arena, unlike its competitors. While companies like BlackRock and Fidelity have pending Bitcoin ETF applications, Vanguard’s CEO, Tim Buckley, confirmed during a recent CNBC interview that his firm has no intentions of following suit.
Buckley stated, “We won’t be pursuing a bitcoin ETF. It’s just like we don’t use gold as an asset class for our clients.” He elaborated by saying, “It’s not that people can’t invest in there. We just look at asset classes or what belongs in a long-term portfolio, what has intrinsic value, has cash flows to it? And those are the asset classes we steer people towards. So we don’t go towards bitcoin or gold or any other of those stable assets.”
Vanguard Spokesperson Claims Cryptos Lack Intrinsic Value
A Vanguard spokesperson provided further insight into the firm’s stance on cryptocurrencies in a comment to Insider, expressing their ongoing skepticism regarding digital assets. The spokesperson stated, “Unlike stocks and bonds, most cryptocurrencies lack intrinsic economic value and generate no cash flows, such as interest payments or dividends.” They went on to highlight, “Further, cryptocurrencies have proven to be highly volatile, which runs counter to Vanguard’s goal to generate positive real returns to investors over time.”
The regulatory landscape pertaining to cryptocurrencies has been a subject of debate, with the SEC having previously rejected multiple Bitcoin ETF applications. However, Grayscale Investments recently achieved a legal victory against the SEC, raising hopes that regulatory barriers may soon be resolved, potentially paving the way for the approval of a spot Bitcoin ETF.
Enthusiasm for Spot Bitcoin ETF Grows
While Vanguard maintains its position, the interest in a potential spot Bitcoin ETF continues to gain momentum within Wall Street.
Renowned cryptocurrency proponent Mike Novogratz recently voiced his conviction that preventing the creation of a Bitcoin ETF would be illogical.
This viewpoint aligns with observable market trends, as investments in digital assets have surged, with the highest weekly inflow since July 2022.
According to a report by CoinShares, investments in digital assets reached a total of $326 million for the week, with Bitcoin constituting a significant 90% of these inflows.
It’s important to highlight that the expectation of a spot ETF approval has triggered a recent upswing in Bitcoin’s price.
The cryptocurrency experienced a surge, reaching around $35,000 earlier this month, primarily fueled by market speculations regarding the possible authorization of a spot ETF.
This price increase has not only captured the interest of investors but has also reignited enthusiasm for cryptocurrency trading, resulting in a substantial uptick in daily exchange volumes.
Reportedly, the seven-day moving average for spot exchange volumes on reputable platforms surpassed a remarkable $24 billion on October 26, a level not witnessed since the end of March.
