Cryptocurrencies at Vanguard
Cryptocurrencies offer many opportunities for investors, and there are several ways to get involved with them. With a Vanguard trading account, investors can participate in the cryptocurrency markets, but it’s not as straightforward as you might think. Here are some options available, along with a great alternative for crypto investing outside of Vanguard.
What is the Blockchain?
When considering cryptocurrencies, it’s important to remember that they are still gaining institutional acceptance. Cryptocurrencies come in different forms, but at their core, they are tokens created through code. This code is publicly shared, and all transactions occur on a public ledger.
Each cryptocurrency operates on its own blockchain network, designed with a specific purpose. Some are meant to be scarce, like gold, while others are abundant and designed for low-cost transactions. The behavior and value of these tokens depend on the goals of their respective blockchains.
Vanguard investors are increasingly interested in cryptocurrencies due to their high volatility and potential for growth. However, Vanguard does not currently offer a dedicated cryptocurrency fund for its investors.
That said, there are still ways for Vanguard account holders to gain exposure to cryptocurrencies.
Proxy Companies
One way to gain crypto exposure is by investing in ETFs and mutual funds that include companies involved in cryptocurrencies. This requires some research, but it’s a viable option.
Some well-known companies involved in cryptocurrencies include PayPal, Tesla, Visa, Galaxy Digital Holdings, Square, Riot, and Coinbase Global.
Investors can search for and invest in these companies directly through Vanguard’s ticker search page. This is useful for those looking to focus on crypto-related stocks rather than broader ETFs or funds.
Riot (RIOT) is a popular choice because it’s a blockchain mining company that often moves in line with major cryptocurrencies.
Cryptocurrency Funds at Vanguard
For many investors, the volatility of individual stocks, especially crypto-related ones, can be overwhelming. Investing in ETFs and funds can be a calmer and less risky alternative. Vanguard offers over 390 ETFs and funds to choose from.
To find the best ETF, look at the companies it includes. ETFs with a higher percentage of crypto-related companies will behave more like the cryptocurrency markets.
One example is the Vanguard Growth ETF (VUG). It includes major tech companies and those heavily invested in blockchain and cryptocurrencies.
Non-Vanguard ETFs, such as Grayscale’s Ethereum, Ethereum Classic, and Bitcoin indexes, are also available to Vanguard users.
Alternative to Vanguard for Cryptocurrency Trading?
As you can see, gaining crypto exposure through Vanguard requires some creativity. However, there are simpler alternatives for cryptocurrency trading.
One of our favorite platforms is Robinhood.
Robinhood is regulated by FINRA/SEC, and client accounts are SIPC insured, just like at Vanguard.
At Robinhood, traders can invest in the same ETFs and stocks available on Vanguard, but they can also directly trade the most popular cryptocurrencies. Here are the cryptocurrencies available on Robinhood:
- Aave (AAVE)
- Avalanche (AVAX)
- Bitcoin (BTC)
- Bitcoin Cash (BCH)
- BONK (BONK)
- Cardano (ADA)
- Chainlink (LINK)
- Compound (COMP)
- Dogecoin (DOGE)
- Dogwifhat (WIF)
- Ethereum (ETH)
- Ethereum Classic (ETC)
- Litecoin (LTC)
- Pepe (PEPE)
- Shiba Inu (SHIB)
- Solana (SOL)
- Steller Lumens (XLM)
- Tezos (XTZ)
- Trump (TRUMP)
- Uniswap (UNI)
- USDC (USDC)
- XRP (XRP)
Advantages of Robinhood for Crypto Trading
There are several reasons investors might choose Robinhood over Vanguard for crypto trading. One of the biggest is direct access to cryptocurrency markets.
Another advantage is Robinhood’s
zero-fee structure for trading stocks, crypto, and ETFs.
New members also receive a free stock after making a $100+ deposit.
Learn more...
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Trading Options on Blockchain Stocks and ETFs
Another way to participate in the cryptocurrency markets is through options trading. Options offer advantages over ETFs and stocks but come with higher risks.
Vanguard offers basic options trading for securities, funds, and ETFs that support options. However, many do not. Additionally, Vanguard does not support multi-leg options strategies.
Updated on 2/24/2025.
Chad Morris is a financial writer with more than 20 years experience
as both an English teacher and an avid trader. When he isn’t writing
expert content for Brokerage-Review.com, Chad can usually be found
managing his portfolio or building a new home computer.
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