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A handful of Wall Street's biggest firms are blocking retail investors from accessing a new “spot” Bitcoin ETF, a FOX Business investigation has found.
Vanguard, the world's second-largest asset manager after BlackRock, and financial advisors Merrill Lynch, Edward Jones and Northwestern Mutual are among the 11 listed investments the Securities and Exchange Commission has blessed to begin trading on national exchanges. There are no plans to provide customers with exposure to the trust. .
The commission's move is a turnaround for the $1.8 trillion crypto market, a way to introduce a product that has been maligned by regulators and largely ignored by Wall Street to large numbers of retail investors. considered as a point.
Spot Bitcoin ETFS: How to invest and what it means
The inclusion of Bitcoin in highly regulated investment vehicles such as spot ETFs means that for the first time retail investors can gain exposure to the world's largest digital asset through a broker-dealer instead of relying on unregulated crypto exchanges. It means you can get it. It also means that investors do not need to qualify as accredited investors, a criterion for purchasing Bitcoin futures ETFs launched in 2021.
WASHINGTON, DC – MARCH 9: Sen. J.D. Vance (R-OH) speaks during a Senate Environment and Public Works Committee hearing at the Capitol on March 9, 2023 in Washington, DC. | Getty Images
The move to restrict access to new ways to invest in cryptocurrencies has led some customers to choose to move to other financial institutions that offer investment opportunities.
Yuga Kohler, senior engineering manager at Coinbase, told FOX Business: “I have eight years worth of ¥401,000 in savings at Vanguard from when I was an employee at Google, and I will roll over those funds to Fidelity. I intend to do so,” he said. “Vanguard’s paternalistic blocking of Bitcoin ETFs does not fit my investment philosophy.”
Vanguard, a BlackRock competitor, told one of its clients who spoke to FOX Business that the new ETF didn't fit with the asset manager's investment philosophy. A Vanguard spokesperson did not respond to a request for comment. However, one media source told The Block, a publication specializing in cryptocurrencies, that cryptocurrencies are considered highly speculative and unregulated. Offering these assets to customers “works against” the “goal of helping investors generate positive real returns over the long term.”
Spot Bitcoin ETFS approved by SEC
Internal communications between Merrill Lynch and its clients reviewed by FOX Business show that current company policy does not allow investing in Bitcoin Spot ETFs, but leaves open the possibility of a change in policy in the future. .
A Merrill Lynch spokesperson did not respond to a request for comment.
Meanwhile, Missouri-based financial services firm Edward Jones also told customers it would join the BTC ETF ban, as did Northwestern Mutual.
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Representatives for Edward Jones and Northwestern Mutual did not respond to requests for comment.
“While it is normal for companies to perform due diligence on individual ETFs before offering them to customers, Vanguard's position is that it is not the performance of the ETF that is relevant to its performance. “This suggests that it may be related to the asset itself.” .
