Vanguard, the $10 trillion asset management giant known for being cautious, is quietly getting ready to allow its brokerage clients to buy digital asset exchange-traded funds (ETFs).
This would be a big deal for the world’s second-largest asset manager, which has been opposed to bitcoin products for years.
Vanguard has been opposed to bitcoin ETFs since their launch in 2024. Fidelity and BlackRock launched their highly successful bitcoin ETFs, Fidelity Wise Origin Bitcoin Fund (FBTC) and iShares Bitcoin Trust (IBIT).
Vanguard not only chose not to launch its own bitcoin ETF, but also blocked its brokerage clients from buying spot bitcoin ETFs from other funds when they first came out, citing volatility and long-term returns.
Related: The Vanguard Bitcoin ETF Refusal: Why It is A Mistake
But client demand and a more favorable regulatory environment seem to be pushing the company to change its stance.
“They’re being very methodical in their approach, understanding the dynamics have been changing since 2024,” a source familiar with Vanguard’s plans told Crypto in America.
According to multiple reports, the company is laying the groundwork and talking to external partners about allowing clients to buy select third-party digital asset ETFs on its brokerage platform.
Vanguard is still not expected to launch its own bitcoin products though. Instead, it will follow the model of Schwab by offering access to ETFs managed by others.
Much of the speculation around Vanguard’s shift has been around its CEO Salim Ramji. As a former BlackRock executive, Ramji helped launch IBIT, which has become one of the most successful ETFs in history with over $80 billion in assets under management.
He took over at Vanguard in mid-2024, and many expected the company’s stance on bitcoin to soften.
At a conference earlier this year, Ramji highlighted that Vanguard would not create its own digital asset ETFs. But he dodged questions about whether clients would be able to buy third-party products through the brokerage platform.
That was enough to set off chatter on Wall Street. Bloomberg analyst Eric Balchunas summed it up on social media: “Vanguard is looking to end bitcoin ETF ban (aka bend the knee lol). We heard chatter of this too. Smart of them imo.”
Vanguard is reconsidering its stance for several reasons. Analysts believe the first one is client demand.
With over 50 million investors, Vanguard has faced backlash from some customers who had to move assets elsewhere to get bitcoin exposure. Offering ETFs would help with client retention and prevent outflows to competitors.
The second one is regulation. Since 2024, U.S. regulators have become more bitcoin-friendly.
The SEC recently approved new listing standards to fast-track ETF applications and the SEC and CFTC have been working together to harmonize digital asset rules. This regulatory clarity has reduced the risk for traditional financial firms to enter the space.
Third, the success of bitcoin ETFs is hard to ignore. Spot bitcoin ETFs have pulled in over $140 billion in inflows since launch, and hold more than 1,300,000 BTC together. That level of institutional interest has made bitcoin impossible for Vanguard to ignore.
