News - Vanguard appoints pro-Bitcoin manager as new CEO

By Mike Hesp

Vanguard appoints pro-Bitcoin manager as new CEO

Bitcoin (BTC)
Crypto acceptance

Bitcoin and Vanguard were not a love story until now. But now a BTC sympathizer is becoming the new CEO of the US financial giant. What's behind it.

Surprising news from U.S. financial giant Vanguard: the world's second-largest asset manager Has appointed Bitcoin-friendly Salim Ramji as new CEO. Ramji oversaw the approval and launch of the Bitcoin ETF of BlackRock before leaving Vanguard's biggest rival in January. Particularly explosive: it is the first time the financial services company has appointed an outsider as CEO. The news has been met with much optimism by the crypto community because it could lead to rising share prices. Unlike competitors BlackRock and Fidelity, Vanguard has previously taken a clear anti-bitcoin stance.

BlackRock, Vanguard and Fidelity are the three largest asset managers in the world

Source: SWFI

Vanguard caused in January indignation because the company strictly denied its clients access to Bitcoin ETF trading. Other major U.S. financial institutions such as JPMorgan and Goldman Sachs were also skeptical of BTC, but left the investment decision to their clients. Tim Buckley, who heads Vanguard until the end of the year, expressed repeated criticism against Bitcoin and advised against including it in a diversified retirement portfolio. According to him, the cryptocurrency is just a speculative asset with no intrinsic value.

Is Vanguard now also participating in the Bitcoin hype?

His successor Salim Ramji has not yet commented on a possible change in BTC strategy at his new employer. But in July 2023, while still a BlackRock manager, told he Bloomberg TV: "The technology underlying Bitcoin and blockchain is something we are incredibly excited about." With its new CEO, it is unlikely that Vanguard will immediately enter the Bitcoin ETF competition. It seems more realistic that clients will have medium- to long-term access to existing BTC index funds. Several ETF experts such as Eric Balchunas are therefore cautiously optimistic.

What is clear is that Vanguard is missing a lot. Within four months, it has already lost $15.5 billion and $8.2 billion, respectively To Bitcoin ETFs of rivals BlackRock and Fidelity flowed. However, due to the influence of Vanguard founder John Bogle, a turnaround in BTC is unlikely to be an easy venture for Ramji. Two years before his death warned the 86-year-old Bogle in the fall of 2017 to shun Bitcoin "like the plague." He is forgiven for this because of his age, especially since he created something great with the index fund. However, the current management team should not desperately cling to the statement of the company's patriarch. Otherwise, Vanguard is shooting itself in the foot. At least the election of the new CEO has sent a positive message.

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