Vanguard Executive Compares Bitcoin To A ‘Digital Labubu’ Even As Firm Allows Client Access To Crypto ETFs ⋆ ZyCrypto

A senior Vanguard executive has asserted that Bitcoin is a purely speculative asset, likening it to a collectible toy, even as the Wall Street behemoth opened the door to crypto-tied exchange-traded funds.

Bitcoin Is No Better Than A Plush Toy: Vanguard Analyst

Speaking during Bloomberg’s ETFs in Depth conference in New York on Thursday, Vanguard’s global head of quantitative equity, John Ameriks, said that Bitcoin lacked the cash flow and compounding traits the company sought when evaluating long-term investments. 

According to Ameriks, Bitcoin still resembles a speculative collectible rather than an asset meant to build long-term wealth. In fact, he characterized the world’s largest and oldest crypto as a “digital Labubu,” referencing the viral plush collectibles.

“It’s difficult for me to think about Bitcoin as anything more than a digital Labubu,” the exec postulated, highlighting what he called the lack of clear evidence that the underlying blockchain technology provides long-lasting economic value.

Bitcoin has long been likened to speculative manias and collectibles, including Dutch tulip bulbs and Beanie Babies. Detractors have pointed to those analogies to contend that Bitcoin’s price gains have been spurred more by speculation than by real-world use cases.

Despite Ameriks’ dismissive view, he suggested that Bitcoin could find real-world use cases beyond market speculation in the future in scenarios of high inflation or political instability. 

Vanguard Finally Enters Crypto Fray

The comments from Ameriks followed Vanguard’s announcement earlier this month, allowing its 50 million clients to access funds holding cryptocurrencies like Bitcoin, Ether, Ripple’s XRP, and Solana.

“We allow people to hold and buy these ETFs on our platform if they wish to do so, but they do so with discretion,” Ameriks noted, adding that even with that access, Vanguard will not offer clients “advice as to whether to buy or sell or which crypto tokens they ought to hold.”

Vanguard had previously said it would steer clear of crypto-related products, including the spot BTC ETFs offered by rivals BlackRock and Fidelity. The firm’s decision to now allow digital assets on its platform demonstrates how the worlds of traditional finance and cryptocurrency are continuing to merge. 

Despite begrudgingly reversing course, Vanguard does not intend to roll out its own crypto ETFs. This is notable given that spot BTC funds have become BlackRock’s biggest revenue drivers.