Vanguard Holds Over 20M Strategy Shares Despite Bitcoin Skepticism

Despite its well-documented skepticism toward cryptocurrencies, asset management titan Vanguard now finds itself heavily exposed to Bitcoin — albeit unintentionally. Through the passive mechanics of its index-based funds, the firm has become a major institutional backer of a company deeply tied to Bitcoin holdings.

How Vanguard Became a Top Shareholder in Strategy

Vanguard, which oversees an enormous $10.4 trillion in global assets, currently holds over 20 million shares of Strategy’s Class A common stock — a firm widely recognized for its extensive Bitcoin reserves. This makes Vanguard the largest institutional shareholder in Strategy, having overtaken Capital Group Cos. sometime in the final quarter of 2024, according to Bloomberg.

The investment was not the result of a strategic bet on cryptocurrency. Instead, it’s a byproduct of Vanguard’s passive investing model. Many of its ETFs and mutual funds track broad market indices. When companies like Strategy meet the criteria for index inclusion — such as sufficient market capitalization, sector classification, and exchange listing — they’re automatically added to these funds’ portfolios.

This means that even companies with business models that contradict Vanguard’s stated views can become part of its holdings, simply by virtue of their presence in benchmark indices.

A Stark Contrast to Vanguard’s Stance on Crypto

Vanguard has maintained a clear, conservative stance on digital assets for years. The firm has repeatedly dismissed cryptocurrencies, including Bitcoin, as speculative instruments that lack intrinsic value and do not align with traditional asset classes like stocks, bonds, or cash. This perspective has kept it on the sidelines of the Bitcoin ETF boom, even as competitors have jumped into the market.

The contradiction hasn’t gone unnoticed. “Vanguard chose this life,” commented Eric Balchunas, senior ETF analyst at Bloomberg Intelligence. “When you have an index fund, you have to own all the stocks, for better or worse, and that includes stocks that you may not like or approve of personally.”

This inherent tension between ideology and passive investing is a growing theme across the financial world. As index-based investing becomes more dominant, firms often find themselves with exposure to sectors or companies they might otherwise avoid.

Could Vanguard’s View Be Shifting?

Although Vanguard has stood firm in its crypto skepticism, industry observers suggest that a change in tone might be on the horizon. In January 2025, Balchunas speculated that the firm may eventually reevaluate its position on Bitcoin and related ETFs, especially as market demand and mainstream institutional acceptance continue to grow.

If that happens, it could mark a significant turning point. Vanguard’s entry into the Bitcoin ETF market would lend even more legitimacy to crypto as an asset class — and signal a major shift in how conservative financial institutions treat digital assets.

A Broader Reflection on Passive Investing and Unintended Exposure

Vanguard’s situation highlights a larger dynamic in passive investing: the lack of discretion over individual stock picks. While this model offers low-cost exposure to market-wide performance, it also means investment firms can wind up with sizable stakes in companies that don’t align with their broader values or strategies.

As cryptocurrency-linked firms become increasingly mainstream and integrated into traditional market indices, more passive funds may find themselves in a similar position. For firms like Vanguard, the challenge will be balancing fiduciary responsibility with their long-held principles — and possibly adapting as the financial landscape evolves.