Vanguard will allow crypto trading on its platform through mutual funds and ETFs

Source: CritpoTendencia Original Title: Vanguard will allow crypto trading on its platform through mutual funds and ETFs Original Link: The poor state of the cryptocurrency market does not seem to stop the strong attraction these assets exert among major institutional players. This time, the asset management giant Vanguard announced that it will allow trading of crypto products on its platform. Specifically, exchange-traded funds (ETF) and mutual funds related to Bitcoin, Ethereum, and other coins.

This is a hugely significant step that leaves behind this financial firm’s previous policy of rejecting the crypto world. Trading will be activated this Tuesday, representing a further boost for the crypto sector among large portfolios.

Until recently, Vanguard’s position was that digital currencies were too volatile as assets. This, they argued, was an obstacle to their involvement in the financial system, as they could create imbalances in serious portfolios. However, it is the very demand from large and medium-sized portfolios that has brought about this change of mind within the firm.

Additionally, the board likely feels the pressure of falling behind other firms that took the first step into the world of virtual currencies. For example, BlackRock, Vanguard’s main rival, already has a strong presence in the crypto sector with notable success, even amid sharp market corrections.

Vanguard senses it will be left behind in the crypto sector

Since October, the cryptocurrency market capitalization has lost more than $1 trillion. This is one of the strongest shocks of recent years in the crypto world, and it shows no clear sign of reversing in the short term. In this context, Vanguard will allow trading of products based on the crypto world on its platform.

The calculations are simple: BlackRock’s exposure to the sector has earned it, with its IBIT ETF alone, $62.5 billion. This is a monumental figure reached in a relatively short period, making corrections like the current one seem like a secondary factor from the institutional perspective.

Thus, the narrative of volatility and risk takes a back seat. Maintaining that stance would have prevented Vanguard from preserving its competitiveness amid the evolutionary process of the financial system and its convergence with blockchain.

Cryptocurrency ETFs and mutual funds have been tested during periods of market volatility and have performed as expected, while maintaining liquidity, said the firm’s head of brokerage and investment, Andrew Kadjeski, in September. At that time, Vanguard gave the first indication of its changing stance toward crypto trading.