- Asset manager Vanguard has announced that it will not allow the purchase of spot Bitcoin exchange-traded funds (ETF) on its platform.
- Vanguard users threaten to close accounts after the firm’s decision.
- Spot Bitcoin ETFs were also reportedly not currently available for purchase on the brokerage platforms of Citi, Merill Lynch, Edward Jones, and UBS.
Financial institutions like Vanguard have no plans to allow spot Bitcoin ETF trading despite approval from the U.S. SEC.
While trading for spot Bitcoin ETFs opened on Jan. 11 across major U.S. exchanges like the Nasdaq and platforms such as Robinhood plan to swiftly add support for these products, some firms have reportedly blocked users from trading them.
According to a Jan. 11 report from The Wall Street Journal, Vanguard, the second-largest asset manager after BlackRock, said it won’t offer the new spot Bitcoin ETFs on its brokerage platform as it did not align with its traditional offerings.
“Spot bitcoin ETFs will not be available for purchase on the Vanguard platform,” said the company in a statement to the WSJ. “We also have no plans to offer Vanguard bitcoin ETFs or other crypto-related products.”
“Our perspective is that these products do not align with our offer focused on asset classes such as equities, bonds, and cash, which Vanguard views as the building blocks of a well-balanced, long-term investment portfolio.”
See Also: Elizabeth Warren Criticizes SEC’s Decision On Spot Bitcoin ETFs
In addition to not enabling trading for the newly approved products, Vanguard disabled the buying of Grayscale’s GBTC shares on its platform, according to several users on X.
I can confirm, I'm still holding my GBTC from 3+ years ago and I can only sell. I cannot add to my position or exchange my GBTC for one of the newer lower cost ETFs.
BUT DON'T WORRY, I CAN STILL BUY THE PAPER FUTURES ETFS LIKE $BITO. WTF?
DO BETTER @Vanguard_Group
— NewWage Crypto (@NewWageCrypto) January 11, 2024
A spokesperson for the firm said Vanguard also has zero plans to offer a Vanguard Bitcoin ETF or other crypto-based products.
One apparent Vanguard customer, Tony Spencer claims a spokesperson told him that Vanguard isn’t allowing spot Bitcoin ETFs for purchase because the product “doesn’t fit with Vanguard’s investment philosophy.”
Spencer also claims Vanguard only allows investors to sell Grayscale’s flagship Bitcoin product, GBTC, which was recently converted into a spot ETF.
🚨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
The Tradfi heavyweight views crypto volatility as a risk to its long-term positive return strategy for customers, per comments from the representative.
Vanguard is notably one of the largest owners of MicroStrategy shares, the Michael Saylor company, which holds over $8 billion in Bitcoin (BTC).
Furthermore, there are reports that other legacy institutions like Merrill Lynch, Citi Bank, UBS, Wells Fargo Advisors, and Raymond James will also boycott spot BTC ETFs — Merrill Lynch, in particular, plans to assess how the ETFs perform and possibly reevaluate its decision.
🚨SCOOP: @MerrillLynch also currently not allowing their customers access to the $BTC Spot ETFs. According to a source who received guidance from the company earlier this week, Merrill is waiting to see whether the ETFs trade efficiently before making any decisions to change… https://t.co/Fu810vdWn1
— Eleanor Terrett (@EleanorTerrett) January 11, 2024
Meanwhile, Bloomberg’s James Seyffart confirmed over $1.2 billion in volume for spot Bitcoin ETFs in the first 30 minutes of trading.
BTC itself briefly touched $49,000 shortly after trading opened but has since declined slightly in price to around $46,300, per Coinstats data.
Despite confirmation from the Securities and Exchange Commission for BTC ETFs, long-standing Bitcoin skeptic Peter Schiff continued championing anti-crypto rhetoric.
Schiff scrutinized mainstream media channels for their coverage of these products and questioned the liquidity following spot BTC ETFs.
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