Vanguard Tops MicroStrategy Holdings Despite Anti-Crypto Stance

In a twist of financial irony, Vanguard — one of the world’s largest asset managers and a vocal skeptic of cryptocurrencies — has emerged as the top institutional holder of MicroStrategy (MSTR), a company known for its massive Bitcoin holdings. This unexpected exposure comes not from a deliberate endorsement of crypto, but rather through Vanguard’s passive index investing strategy. As MSTR’s market capitalization surged due to Bitcoin’s recent rally, the stock gained greater weight in several major indexes. Consequently, Vanguard’s broad-market funds like the Total Stock Market Index Fund and Growth ETF were automatically compelled to accumulate more MSTR shares.

Vanguard now owns over 8% of MicroStrategy’s outstanding Class A shares, valued at roughly $9 billion, making it the company’s largest institutional shareholder. This is despite the firm’s long-standing refusal to offer spot Bitcoin ETFs to its clients and its executives labeling crypto as speculative and lacking intrinsic value. The situation has raised eyebrows across the industry, with some experts calling it a classic case of “institutional cognitive dissonance.”

The incident also highlights a growing issue with passive investing: even firms that explicitly reject crypto exposure are indirectly investing in it through index-linked vehicles. As MicroStrategy continues to amass Bitcoin — now holding over 600,000 BTC — its stock becomes increasingly correlated with Bitcoin’s price movements. This creates a feedback loop where Bitcoin rallies inflate MSTR’s value, which then pushes index funds to buy more, further fueling exposure.

Vanguard’s predicament underscores the evolving nature of modern markets, where crypto-linked equities are blurring traditional asset boundaries. Whether intentional or not, Vanguard’s passive strategies have tethered it to the very asset class it has long dismissed — Bitcoin.