Vanguard’s new CEO, Salim Ramji, has stated that the firm has no intention of entering the cryptocurrency exchange-traded fund (ETF) market, despite the industry’s growing excitement over these new financial products.
In an interview with ETF.com, Ramji reinforced Vanguard’s commitment to its traditional investment philosophy, emphasizing a focus on long-term strategies over chasing trends.
“I’m not going to copy competitors. It’s important that a company stay consistent with who they are. Vanguard must look through the lens of our clients,”
he said.
Ramji emphasized that the asset management firm will remain dedicated to asset classes like equities, bonds, and cash, which align with its core values. He noted that while rivals like BlackRock are expanding their offerings with crypto ETFs, Vanguard’s priority will continue to be delivering consistent, proven investment options and avoiding the volatile cryptocurrency market.
During the interview, Ramji referenced Jack Bogle’s “cost matters hypothesis” to explain Vanguard’s decision against launching crypto ETFs. The theory highlights how investment costs impact long-term returns, emphasizing the importance of minimizing fees, trading expenses, and taxes for improved outcomes.
Ramji, who was appointed CEO on July 8, 2024, is following the path laid out by his predecessor, Tim Buckley. Buckley had consistently warned about Bitcoin’s extreme volatility and unreliability as a store of value. Buckley had stressed that these factors made Bitcoin unsuitable for Vanguard’s offerings. Interestingly, he advised against including Bitcoin ETFs in retirement plans, citing the cryptocurrency’s sharp decline during the 2022 market crash as further evidence of its instability.
Before his appointment as CEO, there were speculations that Ramji would change Vanguard’s stance on crypto ETFs given his background as an executive in BlackRock, the biggest player in the market. He was reportedly involved in the filling process for BlackRock’s spot Bitcoin ETF, iBIT.
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