Vanguard Global director of capital markets development Janel Jackson explained the company's position on digital assets. She stated that although Bitcoin is classified as a commodity, it is an immature asset class. As Jackson put it, Bitcoin has little history, no intrinsic economic value, no cash flow, and can wreak havoc on an investment portfolio.
Jackson noted that Vanguard will not be launching a Bitcoin ETF or any other cryptocurrency-related product given the current state of the crypto market. The company has a very rigorous decision-making process when introducing new investment products—Vanguard's primary focus is on long-term investment benefits, Jackson said. Despite the growing debate surrounding Bitcoin and cryptocurrencies, Vanguard does not believe they are suitable for inclusion in long-term portfolios.
Vanguard Director of Brokerage and Investments Andrew Kadjeski emphasized that Vanguard's investor base is primarily made up of long-term investors. So even if clients could easily gain full access to cryptocurrency products, the move would run counter to Vanguard's mission to serve the interests of long-term investors.
But many of Vanguard's clients have been frustrated by the company's focus on traditional asset classes: stocks, bonds and cash. Industry experts also suggested that Vanguard's position on Bitcoin ETFs runs counter to the current market trend, with many investors seeking exposure to digital assets.
Let us recall that last year Vanguard Group increased its investments to more than $500 million in companies engaged in bitcoin mining. In 2020, Vanguard successfully tested a blockchain-based securities settlement system.
Source: Bits
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