Vanguard executives struggle with Bitcoin value as Bitcoin dips below $90,000

Bitcoin prices were trading in the $92,000 range earlier today, but have now fallen to around $90,000, reflecting continued volatility despite the Federal Reserve’s 25 basis point interest rate cut.

After briefly climbing above $93,000 yesterday, the cryptocurrency fell below $90,000 and stabilized around $90,600 at the time of writing.

The rebound came amid mixed signals from the Fed. A rate cut to 3.50% to 3.75% was widely expected, but cautious remarks from Fed Chairman Jerome Powell and a 9-3 split among FOMC members (one in favor of a deep 50 basis point cut, two against any cut) dampened enthusiasm for risk assets, including BTC.

Analysts described the decline as a “fact-selling” reaction, as the market had already priced in the move.

In addition to this, Vanguard Group has begun allowing clients to trade spot Bitcoin exchange-traded funds (ETFs), marking a significant expansion in access to crypto products for investors at the $12 trillion asset management company.

However, a senior Vanguard executive emphasized that the company’s fundamental view of BTC and other cryptocurrencies remains skeptical.

John Amerix, Vanguard’s global head of quantitative equities, said Thursday at Bloomberg’s ETFs in Depth conference that Bitcoin is seen more as a speculative collectible than a productive asset.

Comparing Bitcoin to a viral stuffed animal, Amerix emphasized that BTC lacks income, compounding potential, and cash flow generation, which are core attributes Vanguard looks for in a long-term investment.

“With no clear evidence that the underlying technology provides any lasting economic value, it’s hard to think of Bitcoin as anything more than a digital bubbly,” he said, according to Bloomberg.

Despite these caveats, Vanguard’s decision to allow trading of BTC ETFs on its platform was influenced by the growing track record of such products since the launch of the first BTC ETF in January 2024.

Amerix said the company wants to ensure these ETFs accurately reflect their advertised holdings and perform as expected.

Banks working on Bitcoin

Earlier this week, PNC Bank became the first major U.S. bank to use Coinbase’s Crypto-as-a-Service infrastructure to offer spot Bitcoin transactions directly to eligible private bank customers through its digital platform.

The launch follows a strategic partnership announced in July and reflects a growing trend among U.S. banks to integrate Bitcoin into their wealth management services.

Also last week, Bank of America urged its wealth management clients to allocate between 1% and 4% of their portfolios to digital assets, signaling a major shift in its approach to Bitcoin exposure.

As of today, Bitcoin is trading at approximately $90,115.85, with a circulating supply of approximately 19.96 million BTC and a market capitalization of $1.81 trillion.

Over the past week, prices have fluctuated modestly, reflecting overall market volatility.