The Vanguard Group Opens Door to Virtual Asset ETFs... Will Institutional Investment Follow? [Crypto Briefing]

[Financial News] The Vanguard Group, the leading player in the U.S. retirement pension market, has decided to allow trading of Bitcoin (BTC) and other Virtual Asset Exchange-Traded Funds (Virtual Asset ETF) on its platform. This move is expected to accelerate the inflow of institutional funds. Unlike competitors such as BlackRock and Fidelity Investments, The Vanguard Group has maintained a conservative stance. However, with this decision, there are growing expectations that retirement pension funds will flow more rapidly into the Bitcoin market.
According to foreign media and the virtual asset industry on the 8th, The Vanguard Group, a major force in the U.S. retirement pension market, has shifted from its previous conservative approach and decided to support trading of Virtual Asset ETFs. The Vanguard Group had previously blocked even spot Bitcoin ETF transactions, stating that 'virtual assets have no intrinsic value.' While the company still draws a line at launching its own Virtual Asset ETF, it is expanding investment options by brokering other Virtual Asset ETFs, attracting significant attention from the domestic financial investment sector.
In an official announcement, The Vanguard Group stated, 'We have no plans to launch our own Virtual Asset ETF or mutual fund,' but added, 'Based on ongoing monitoring and analysis of the virtual asset market, we have decided to allow most third-party Virtual Asset ETFs and mutual funds on the Vanguard brokerage platform.' The company further noted, 'Virtual Asset ETFs are maintaining liquidity despite market volatility and are performing as originally designed.'
While competitors such as BlackRock and Fidelity Investments have launched spot Bitcoin ETFs, The Vanguard Group’s entry into the virtual asset industry, despite its previously conservative stance, is raising expectations within the sector. Han Jong-mok, a researcher at Mirae Asset Securities, commented, 'The Vanguard Group’s decision demonstrates that, regardless of market fluctuations, virtual assets have become an essential asset class that cannot be excluded from clients’ portfolios.' Hong Sung-wook, a researcher at NH Investment & Securities, remarked, 'The Vanguard Group’s support for Virtual Asset ETF trading will improve accessibility to BTC,' adding, 'This underscores the growing importance of BTC in the investment landscape.'
The timing of The Vanguard Group’s decision is notable, as it comes during a bearish phase in the BTC market. According to global financial information platform Investing.com, BTC has dropped nearly 12% over the past month. Compared to the October peak of $126,000, it has plunged by almost 30% and now hovers around the $90,000 level.
Although capital outflows from U.S. spot Bitcoin ETFs have stabilized, a full recovery has yet to materialize. According to global virtual asset information platform Bitbo, the net outflow from spot Bitcoin ETFs, which has continued since last October, has recently shown some stabilization, with daily net inflows and outflows alternating. However, on a cumulative basis over the past 30 days, there remains a net outflow amounting to several billion dollars, making it difficult to conclude that ETF fund flows have entered a clear recovery phase.
Nevertheless, The Vanguard Group can no longer remain on the sidelines. With the U.S. spot Bitcoin ETF market rapidly expanding to $125 billion, there is a growing concentration of related funds toward competitors like BlackRock. Furthermore, in February next year, the United States Department of Labor (DOL) will announce new retirement portfolio guidelines. One researcher estimated, 'If guideline changes allow Bitcoin ETFs to be included as a default option in pension portfolios, tens of billions of dollars in buying pressure will be executed every month, regardless of market conditions.' The researcher added, 'If just 1% of the U.S. retirement pension market is allocated to BTC, it would result in an inflow of approximately $90 billion.'
elikim@fnnews.com Kim Mi-hee Reporter