Why Vanguard Does Not Offer Spot Bitcoin ETFs: Explained

The Immaturity of Cryptocurrency as an Asset Class

Financial giant Vanguard has recently shed light on its decision not to make spot bitcoin exchange-traded funds (ETFs) available on its trading platform. In a blog post titled "No Bitcoin ETFs at Vanguard? Here's why," Vanguard emphasized that cryptocurrency is still an immature asset class with limited history and no inherent economic value or cash flow. The firm believes that including cryptocurrencies in investment portfolios can potentially create havoc.

Vanguard's Stance on Crypto Products

Vanguard, which serves over 50 million investors worldwide and manages around $8 trillion globally, has gained attention for its decision to disallow clients from trading the newly approved spot bitcoin ETFs. The company also has no plans to launch its own spot bitcoin ETFs.

Janel Jackson, Vanguard's global head of ETF Capital Markets and Broker and Index Relations, explained the firm's viewpoint in the blog post. Vanguard sees crypto as more of a speculation rather than an investment, which is why it does not offer crypto products. Jackson emphasized that equities and bonds have inherent value and cash flows, while commodities meet consumption needs and have inflation-hedging properties. In contrast, cryptocurrency lacks these essential characteristics.

Vanguard's Interest in Blockchain Technology

Despite its reservations about cryptocurrency, Vanguard expressed a keen interest in blockchain technology. The firm believes that the application of blockchain to various industries beyond crypto can enhance the efficiency of capital markets. Vanguard has actively engaged in research on blockchain technology and its potential uses.

No Plans for Vanguard to Launch Crypto ETFs

Vanguard clarified that, considering the current state of crypto as an asset class, it does not have any plans to launch its own spot bitcoin ETF or any other crypto-related products. The firm thoroughly evaluates investment products based on their enduring investment merit and their ability to meet clients' needs. Vanguard's rigorous product launch process guides all its decisions.

What are your thoughts on Vanguard's explanation regarding spot bitcoin ETFs? Let us know in the comments section below.

Frequently Asked Questions

Can you make a profit on a Gold IRA?

Two things are necessary if you want to make a profit on your investment. First, you need to understand the market. Second, you need to know what type of products you have.

If you don’t know anything, it is best to wait until you have enough information so that you can trade effectively.

Also, you should find the broker that provides the best service possible for your account type.

There are many accounts available, including Roth IRAs and standard IRAs.

If you have any other investments such stocks or bonds, you may want to consider a rollover.

Which type or type of IRA would be best?

It is essential to find an IRA that matches your needs and lifestyle when you are choosing one. It is important to consider whether you want tax-deferred, maximized growth of your contributions, reduced taxes now and paid penalties later, or just avoid taxes.

If you're saving for retirement and don't have much money invested, the Roth option could make sense. If you plan to continue working beyond age 59 1/2, and pay income taxes on any account withdrawals, the Roth option may be a good choice.

Traditional IRAs are more suitable if you intend to retire young. However, you will most likely owe taxes on any earnings from those funds. However, if your goal is to retire early, the traditional IRA might be more sensible. The Roth IRA allows you to withdraw some of your earnings or all without paying taxes.

Can I put gold in my IRA?

The answer is yes It is possible to add gold to your retirement plans. Because it doesn't lose any value over time, gold is a great investment. It is also immune to inflation. You don't even have to pay taxes.

It's important to understand the differences between gold and other investments before investing in it. You can't purchase shares in gold companies, unlike stocks and bonds. Nor can you sell them.

Instead, convert your gold to money. This means that you'll have to get rid of it. It's not enough to hold on to it.

This makes gold an investment that is different from other investments. You can always sell other investments later. But that's not the case with gold.

Even worse, gold cannot be used to secure loans. If you get a mortgage, for example, you might have to give up some of the gold you own in order to pay off the loan.

What does all this mean? You can't just keep your gold forever. You will have the need to make it cash someday.

You don't need to worry. To open an IRA, all you need is to create one. Then, you are able to invest in gold.

Are gold and Silver IRAs a good idea or a bad idea?

This is a great option if you're looking for an easy way of investing in both silver and gold simultaneously. There are many other options. Contact us anytime if you have questions about these types investment options. We are always happy to assist!

Can I take physical possession of gold in my IRA?

Many people ask themselves whether it is possible to physically own gold in an IRA. This is a valid question as there is no legal route to it.

You can still own gold in an IRA if you look at the law.

The problem is that most people don't realize how much money they could save by putting their gold in an IRA instead of keeping it in their own homes.

It's easy for gold coins to be thrown away, but it's much more difficult to keep them in an IRA. If you decide that you want to keep your gold at home, you'll be responsible for two tax payments. You will pay taxes twice: once to the IRS and one for the state in which you live.

You can also lose your gold and have to pay twice the taxes. So why would you choose to keep it in your home?

It might seem that you want the security of knowing your gold is safe inside your home. You can protect your gold from theft by storing it somewhere more secure.

If you are planning to visit frequently, your gold should not be left at home. If your gold is left unattended, thieves could easily steal it when you're away from home.

It is better to keep your gold in an insured vault. Then, your gold will be protected from fire, flood, earthquake, and robbery.

One advantage of storing your gold safely in a vault is the fact that you don't have to worry too much about property tax. Instead, you will have to pay income tax for any gains you make selling your gold.

If you'd rather avoid paying taxes on your gold, you may want to consider putting it in an IRA. An IRA allows you to keep your gold free from income taxes, even though it earns interest.

Capital gains tax is not a requirement for gold investments. You can cash out your entire investment anytime you wish.

Because IRAs have federal regulation, it won't be difficult to transfer your gold to another bank if there is a move.

Bottom line: An IRA can allow you to own gold. The only thing holding you back is your fear of having it stolen.


  • Silver must be 99.9% pure • (forbes.com)
  • You can only purchase gold bars of at least 99.5% purity. (forbes.com)
  • The IRS also allows American Eagle coins, even though they do not meet gold's 99.5% purity standard. (forbes.com)
  • To qualify as IRA allowable precious metals and be accepted by STRATA, the following minimum fineness requirements must be met: Gold must be 99.5% pure, silver must be 99.9% pure, and platinum and palladium must both be 99.95% pure. (stratatrust.com)

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How To

How to Start Buying Silver with Your IRA

How to get started buying silver with your IRA – Owning physical bullion directly is the best way for you to invest in silver and gold. Bars and silver coins are the most common form of investment. They offer liquidity, diversification, and convenience.

If you want to buy precious metals like gold and silver, several options are available. You can purchase them directly through their producers, which include mining companies or refiners. You can buy them directly from the producer or a dealer who purchases and sells bullion.

This article will show you how to get started investing in silver using your IRA.

  1. Investing directly in Gold & Silver – This is your first choice for buying precious metals. This involves getting the bullion and having it delivered to your doorstep. Some investors decide to keep their bullion at their home while others prefer to store it in an insured storage facility. You should ensure that your precious metal is properly stored when you are preserving it. Many storage facilities offer insurance against fire, theft and damage. But even with insurance, you risk losing your investments due to natural disasters or human error. For these reasons, storing your precious metals in a safe deposit box at a bank or credit union is always recommended.
  2. Online Precious Metals Buying – If you prefer not to transport heavy boxes of precious metal around, then buying bullion online is an option. Bullion dealers sell bullion online in many forms, including coins or bars. Coins come in different sizes, shapes, and designs. Coins are generally more convenient to carry than bars. Bars come with a range of weights and sizes. Bars come in a variety of sizes and weights. Some bars weigh hundreds while others weigh just a few pounds. It is important to think about what you intend to use the bar for when choosing the type of bar that you should buy. It might be a good idea to choose something smaller if it is intended to be given as a gift. You might spend more money if you plan to display it and add it to your collection.
  3. Precious Metals From Dealers – A third option to buying bullion is from a dealer. Most dealers are experts in one part of the market: gold or silver. Some dealers are experts in specific types of bullion such as rounds and minted coins. Others may specialize in specific areas. Others specialize in bulk buying. Regardless of which dealer you choose, you'll likely find that they offer competitive prices and convenient payment methods.
  4. Buy Precious Metallics from Retirement Accounts. While technically not an “investment”, it's possible to invest in retirement accounts to gain exposure. To qualify for tax benefits under Section 219 of the IRS Code, you must invest in precious metals through a qualified retirement account. These accounts include IRAs and 401(k), as well as 403(b), plans. These accounts are designed to help you save for retirement and often provide higher returns than other investment vehicles. In addition, most of these accounts allow you to diversify your holdings across multiple metals. But what's the downside? You can't invest in retirement accounts. These accounts can only, however, be accessed by those who work for an employer that sponsors them.


By: Kevin Helms
Title: Why Vanguard Does Not Offer Spot Bitcoin ETFs: Explained
Sourced From: news.bitcoin.com/vanguard-says-no-to-bitcoin-etfs-views-crypto-as-immature-asset-class-with-no-inherent-economic-value/
Published Date: Mon, 29 Jan 2024 01:00:24 +0000

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