One of the world’s largest investment companies, Vanguard, is in the spotlight following its blocking of customer access to publicly listed, SEC-approved Bitcoin ETFs. Not only are clients jumping the Vanguard ship, but more eye-opening revelations are emerging.
On January 11, investment giant Vanguard decided not to offer its customers recently approved spot Bitcoin ETPs. The move sparked a wave of backlash and revelations of more shadowy operations at the company.
Vanguard Exodus Continues
The customer exodus has already commenced, with FOMO 21 co-founder Neil Jacobs stating:
“I’m working on transferring assets out of there and then I will close my Vanguard account. Terrible business decision by Vanguard.”
Lead market analyst at Swan, Sam Callahan, advised his 24,500 X followers how to transfer their accounts out of Vanguard.
NFT collector ‘yugacohler’ said
“I have 8 years worth of 401K savings at Vanguard from my time as an employee at Google. I will be rolling over these funds to Fidelity.”
Meanwhile, ‘DCinvestor’ posted the hashtag #LeaveVanguard to his 235,000 X followers on January 12.
Read more: How To Prepare for a Bitcoin ETF: A Step-by-Step Approach
Former Vanguard client Vanessa Harris said she had just fully transferred her retirement account from Vanguard to Fidelity “because Vanguard won’t support Bitcoin ETFs.”
However, she added that the firm “appears to be manipulating the price of Bitcoin by only allowing people to sell GBTC [Grayscale Bitcoin Trust], not buy.”
This was also highlighted by analyst and investor Scott Melker, who said something was fishy:
“Did you know that Vanguard has allowed the trading of GBTC, which swung from a 50% premium to a 50% discount to NAV against spot BTC, but they are banning the trading of Bitcoin Spot ETFs because of ‘volatility?’”
Moreover, Capriole Fund founder Charles Edwards said that Vanguard was not the only firm refusing to allow customers to buy Bitcoin ETFs. “Morgan Stanley, Citi, Merrill, Edward Jones, and UBS did not allow clients to trade it,” he said.
Shady Offerings?
Cinneamhain Ventures (CEHV) partner and industry critic Adam Cochran alleged even more questionable dealings at Vanguard.
He noted that the firm cited its “investment policy” for not including Bitcoin, then questioned:
“But you’re fine offering $VWOB which is bonds from China, Saudi Arabia, Qatar, and other nations with extensive human rights violations and terrorist financing?”
Vanguard is now taking some “weird moral high ground to overrule user sovereignty and be some prescriptive parent,” he added.
It remains to be seen whether the company will lose enough business over its policies to force a rethink. The firm claims to have had over 50 million investors as of December 31, 2022.
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