Vanguard, one of the largest asset managers globally, has become a significant shareholder in a crypto-related company despite its criticism of Bitcoin.
Vanguard's Indirect Exposure to Bitcoin
Although Vanguard does not invest directly in Bitcoin, its index funds have provided the company with a significant stake in Strategy, one of the symbolic companies in the crypto market. Vanguard holds approximately 8% of Strategy's publicly traded Class A shares, totaling over 20 million shares.
Vanguard's Criticism of Cryptocurrencies
Vanguard management has maintained a strong stance against cryptocurrencies. CEO Tim Buckley has described Bitcoin as 'speculative and lacking in economic value,' unsuitable for long-term portfolios. He also barred Bitcoin ETFs from trading on his platform when they launched in the US in 2024.
Strategy's Position and Market Impact
Strategy, formerly known as MicroStrategy, became the first publicly traded company to invest heavily in Bitcoin since 2020. Led by Michael Saylor, the company funds its Bitcoin purchases through both borrowing and issuing stock. Since then, its shares have increased by approximately 3,400%.
Thus, Vanguard's investment in Strategy shares indicates a growing acceptance of Bitcoin by traditional financial institutions, potentially reshaping the cryptocurrency market.
