Bitcoin ETFs Shut Out: Vanguard And Merrill Lynch Deny Customers Access

The cryptocurrency market has received a major regulatory boost with the approval of Bitcoin (BTC) to trade on the largest US exchanges through Bitcoin ETFs offered by some of the world’s largest asset managers. 

However, despite this regulatory success, Vanguard and Merrill Lynch, two prominent institutions in the United States, have chosen not to offer exposure to Bitcoin through these newly approved investment products, leading clients to cash out and seek alternative platforms.

Vanguard And Merrill Lynch Skip Bitcoin ETFs

Vanguard, one of the largest asset managers in the world, made its stance clear even before the regulatory approval. The firm stated that it has no intention of offering a spot Bitcoin ETF or any other crypto-related products, citing a “weak” investment case for digital assets. 

The company highlighted that, unlike traditional stocks and bonds, most cryptocurrencies lack intrinsic economic value and generate no cash flows. 

Vanguard’s decision goes against the trend set by other major asset management firms such as BlackRock and Fidelity, which have already launched their spot Bitcoin ETFs.

Merrill Lynch, owned by Bank of America, has also followed Vanguard’s lead, currently not allowing its customers access to BTC spot ETFs. The company is reportedly waiting to assess the efficiency of these ETFs before considering any changes to its internal policy that currently prohibits such products. 

This move has prompted concern among investors who were eager to invest in Bitcoin through these newly approved ETFs.

Disgruntled Users Move Funds From Vanguard To Fidelity

In response to Vanguard’s and Merrill Lynch’s denial of access, disgruntled users have reported transferring hundreds of thousands of dollars from Vanguard to Bitcoin ETF issuer Fidelity. 

Notably, they are encouraging other investors to join them in this protest to gain exposure to the recently approved Bitcoin ETFs.

Overall, the decision by Vanguard and Merrill Lynch highlights a divide within the asset management industry regarding the acceptance and adoption of digital assets. While some firms see the potential of cryptocurrencies and have launched their own Bitcoin ETFs, others remain skeptical.

The denial of access to Bitcoin ETFs by these major institutions is expected to push investors toward asset managers that allow investments in these newly approved products.

As the market reacts to this development, investors and industry observers will closely monitor the performance of Bitcoin ETFs and the potential impact on the overall cryptocurrency market. 

It remains to be seen how these asset management giants will respond to this backlash and whether they will reconsider their stance if the ETFs perform as expected.

As of the time of writing, the price of BTC has remained unaffected despite the approval of Bitcoin ETFs on Thursday. The cryptocurrency is currently hovering around the $46,500 mark, experiencing a slight decrease of 0.3% in the past 24 hours.

Featured image from Shutterstock, chart from TradingView.com