- The Reversal: Vanguard now permits trading of crypto ETFs/mutual funds, ending its controversial multi-year ban.
- The Scope: Access is limited to “Investment Grade” assets: Bitcoin, Ether, XRP, and Solana.
- The Guardrail: The firm explicitly bans memecoins, citing the SEC’s 2025 “Collectibles” guidance.
Vanguard Group capitulated to market demand Tuesday, reversing a strict four-year policy to allow its 50 million clients to trade cryptocurrency exchange-traded funds (ETFs) and mutual funds. The $11 trillion asset manager will now facilitate access to regulated products tied to Bitcoin, Ether, XRP, and Solana, effectively normalizing crypto assets within the world’s most conservative investment portfolios.
The shift, as reported by Bloomberg, follows an ongoing demand from both retail and institutional investors, despite a market environment defined by price corrections and a crypto-sector drawdown exceeding $1 trillion since early October.
Related: Vanguard Appoints Former BlackRock Executive Salim Ramji as New CEO
Expanded Access for Millions of Brokerage Users
The change gives more than 50 million Vanguard brokerage clients, who collectively oversee more than $11 trillion, the ability to buy and sell regulated crypto wrappers that meet the firm’s eligibility criteria. The products will be treated similarly to other non-core asset classes already available through the platform.
The move comes as crypto-linked ETFs continue to rank among the fastest-growing segments in the U.S. fund industry. Spot Bitcoin ETFs launched in January 2024 accumulated billions in inflows, including about $70 billion in BlackRock’s IBIT ETF, down from approximately $100 billion two months earlier but still one of the largest single products in the space.
Operational Readiness Cited as Key Factor
Vanguard stated that the internal processes required to support crypto ETFs and mutual funds have advanced. According to Andrew Kadjeski, Head of Brokerage and Investments, these funds have maintained liquidity and functioned as intended during periods of heightened volatility. The company added that while it will allow trading of crypto-focused funds that meet regulatory standards, it does not plan to launch its own digital-asset products.
Additionally, Vanguard emphasized that products tied to memecoins, as defined by the U.S. Securities and Exchange Commission, will remain excluded from the platform. The firm reiterated that its role is limited to offering access, rather than issuing or managing digital assets.
Analyst Reaction and Historical Context
Eric Balchunas of Bloomberg commented on the policy shift in a post on X, noting that Vanguard will begin allowing ETFs and mutual funds tracking Bitcoin and select other cryptocurrencies to trade on the platform.
He pointed out that the firm referenced the performance of these ETFs through multiple periods of volatility as proof that the structures have operated according to their design. His remarks echoed broader market observations that investor demand for regulated crypto vehicles has continued despite declining prices.
Vanguard’s reversal also contrasts with its earlier public messaging. In November 2021, the company published a detailed explanation outlining why it did not support cryptocurrency products at the time. That briefing highlighted concerns about extreme price fluctuations, liquidity risk, cybersecurity threats, and the absence of intrinsic yield when compared with traditional income-generating assets.
The 2021 document further described the speculative nature of digital assets, the limited regulatory oversight, and the challenges posed by decentralization and anonymity. While the firm acknowledged blockchain’s technological utility, it concluded then that cryptocurrencies lacked the long-term investment characteristics aligned with its philosophy.
Related: 12 XRP ETF Proposals Now Before SEC; BlackRock and Vanguard Notably Absent
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Source: https://coinedition.com/vanguard-opens-trading-for-bitcoin-xrp-and-solana-etfs/
