Bank of America and Vanguard Warm to Crypto, Goldman Strikes Deal for ETF Issuer, and Strategy Sets Up $1.4B Reserve

Takeaways

• Bank of America is said to be set to allow its wealth-management advisors to recommend a 1% to 4% crypto allocation: The initial focus will be on spot bitcoin ETFs including BlackRock’s and Fidelity’s, potentially boosting inflows to an already popular financial products.
• Vanguard will allow clients to trade crypto ETFs and mutual funds on its brokerage platform, reversing historically anti-crypto stance: With 50 million investors, the move could help bolster crypto ETFs inflows, but the firm said it did not plan to issue its own crypto products.
• Goldman Sachs agreed to acquire ETF manager Innovator Capital Management for $2 billion in a push to expand its asset management business: The deal adds roughly $28 billion in assets under supervision and could have significant implications for the crypto space by broadening Goldman’s ETF issuing capabilities.
• Strategy sold common stock to raise a $1.44 billion dollar reserve intended to cover preferred-stock dividends for at least one year: The company also reduced its full-year profit forecast and added an additional 130 BTC to its holdings for roughly $11.7 million.
• Sony Bank announced that it is preparing to launch a USD-pegged stablecoin in the US next year: The Japanese firm has partnered with Bastian to issue the token. Customers will use it to pay for games, anime, and other parts of the PlayStation ecosystem.

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Bank of America To Allow Advisors To Recommend Crypto Allocations

The decision means that the bank’s clients could increase their crypto exposure in the coming year and beyond, which could help buoy crypto prices and ETF inflows.

Previously, restrictions imposed by Bank of America on its wealth-management advisors prohibited them from recommending crypto investment to clients. Industry experts have noted that BoA’s more crypto friendly stance indicates that ETFs are becoming an increasingly mainstream means of offering exposure to the crypto ecosystem.

The announcement was one of several factors, including analysts increasing the likelihood of a rate cut by the Federal Reserve next week, which helped bitcoin and crypto prices recover after a notable early-week dip. If the expected rate cut takes place next week, this recovery could be extended.

Vanguard Pivots to Allow Crypto ETFs and Mutual Funds on Its Platform

Vanguard has roughly 50 million clients and $11 trillion worth of assets under management, so the move has potential to significantly increase flows to listed crypto products.

The firm said it has no plans to begin issuing its own crypto ETFs, and that they will not offer memecoin-linked products or products not licensed by the SEC. The firm’s Head of Brokerage and Investments, Andrew Kadjeski, said that crypto ETFs have endured challenging circumstances and have managed to maintain liquidity as intended. Currently, US spot bitcoin ETF have an AUM of around $122 billion, while US spot ether ETFs have around $18.7 billion under management.

Goldman Sachs to Buy ETF Issuer Innovator Capital Management for $2 Billion

The move will reportedly add roughly $28 billion in assets under supervision to the banking giant’s $3.45 trillion. Representatives from Goldman said that the company is eager to accelerate their ETF strategies and the deal will be paid for in a mix of cash and stock.

The decision from Goldman to further enter the ETF space could have significant implications for crypto, as industry experts have predicted the firm is likely to begin issuing its own crypto ETFs. Goldman’s peers have seen success with crypto ETFs, with Blackrock’s spot Bitcoin ETFs becoming the firm’s most profitable product line. Additionally, Goldman already serves as an Authorized Participant for four large bitcoin ETFs, including Blackrock’s iShares Bitcoin Trust ETF (IBIT). If the firm is indeed interested in entering the crypto ETF market, it could result in further growth for the space.

Strategy Establishes $1.44B Reserve, Purchases Additional 130 BTC

The fund is intended to cover at least one year of dividend payments, but is targeting supporting two years or more. The firm also adjusted its financial guidance in light of bitcoin's recent slip, reducing its bitcoin yield and dollar gain targets.

Strategy also purchased an additional 130 BTC for roughly $11.7 million, raising its total holdings to 650,000 BTC. The reserve’s average cost per coin now sits at around $74,436, with the total cost of the treasury at $48.38 billion. In a move less encouraging to investors however, CEO Phong Le also stated this week that the company is prepared to sell bitcoin if the firm’s mNAV (a metric comparing the company’s market cap to the value of its bitcoin held) becomes too low. However, Le reiterated that this would only ever be done as a last resort.

Sony Bank Plans US Dollar Stablecoin With 2026 Launch Target

The firm reportedly plans for the stablecoin to be used by customers for purchasing games, anime, and for use in its PlayStation ecosystem. For minting and settlement infrastructure, Sony Bank has chosen US-based Bastion as its partner.

As part of its efforts to expand in the US, Sony also applied for a US banking license in October this year. The firm’s US branch now generates a significant portion of its revenue, which contributed to the company’s choice of a USD-denominated stablecoin. This launch is far from the company’s first foray into digital assets. In January this year, Sony launched its Ethereum layer-2 solution called Soneium, which focuses on web3, digital collectables, and enterprise solutions.

-Team Gemini