Vanguard's Buckley Doubles Down on Anti-Bitcoin ETF Stance

Vanguard's Buckley Doubles Down on Anti-Bitcoin ETF Stance

Vanguard CEO, who is retiring this year, reiterated the company's position that crypto is "speculative."

etf
|
Reviewed by: Ron Day
,
Edited by: etf.com Staff

Vanguard CEO Tim Buckley has doubled down on the firm’s anti-bitcoin ETF stance.

In a recent company webinar, Buckley said the world’s largest asset manager was unlikely to change its mind on bitcoin “unless the asset class changes.”

“We do not plan to, and we are not going to change our minds around this unless the asset class changes," Buckley, who announced March 1 that he'd be retiring this year, said in response to a webinar question on what it would take for it to launch a bitcoin ETF.

“For why, first of all, we do not believe a bitcoin ETF belongs in a long-term portfolio of someone saving for their retirement," he said in a recorded conversation with Chief Investment Officer Greg Davis. "It is a speculative asset.”

Vanguard’s stance leaves it as somewhat of an outlier in the crypto space, with the likes of BlackRock, Fidelity Investments and Invesco all launching physical bitcoin ETFs in the U.S. since their Jan. 10 approval.

“Something like bitcoin is just too volatile and it is not a store of value," he said. “When stocks got hammered in the recent crisis, bitcoin went right with them. It is speculative. It is tough to think about how it belongs in a long-term portfolio.”

He said it does not act like equities—which offer goods and services and pay dividends—or offer the income stream of bonds.

On March 1, Blackrock's physical bitcoin ETF, the iShares Bitcoin ETF (IBIT), hit $10 billion in assets under management (AUM), the fastest ETF to ever hit the milestone. It has since surged to $16.4 billion in assets.

Investors in the U.S. are also unable to get access to bitcoin ETFs via Vanguard’s brokerage platform.

The passive giant has a history of excluding certain types of investments that are not “consistent with our philosophy and past practice”.

This includes the “internet funds of the late 1990s”, according to Vanguard.

It also banned access to leveraged and inverse funds and ETFs on its platform in 2019, as well as most over-the-counter stocks.

Vanguard founder Jack Bogle famously turned down the offer to launch the first ETF, viewing the wrapper as a trading vehicle and staunchly against the firm’s buy-and-hold philosophy.

Eight years after the launch of the first-ever ETF, the SPDR S&P 500 ETF Trust (SPY), Vanguard launched its first ETF in 2001.

The Vanguard Total Stock Market ETF (VTI) was unveiled as a share class of its global equity mutual fund, in a previously patented process.

This article first appeared in etf.com's sister publication ETF Stream, Europe's leading source for ETF news and analysis.

Theo Andrew joined ETF Stream as a senior reporter in September 2021. He has over four years of investment writing experience spanning pensions and retail investments, most recently at Citywire, where he was a senior reporter covering environmental, social and governance investing.