Vanguard strategist brands Bitcoin a ‘digital Labubu’ as bearish pattern emerges
Bitcoin’s latest price slump has revived criticism from traditional finance, with a senior Vanguard executive likening the flagship cryptocurrency to a “digital Labubu” just as a notably bearish technical formation takes shape on the charts.
On December 12, Bitcoin (BTC) slid back below the $90,000 mark, trading around $89,700 — a sharp retreat from its year‑to‑date peak near $126,300. The pullback came alongside a broader risk‑off move in markets: major U.S. stock indices such as the Nasdaq 100 and S&P 500 both dropped more than 1%, amid renewed concerns that optimism around artificial intelligence may have overheated parts of the equity market.
Why a ‘digital Labubu’?
John Ameriks, a senior executive at Vanguard, drew a pointed comparison between Bitcoin and Labubu, a plush toy produced by Pop Mart. Labubu became a speculative craze, with demand surging and then collapsing within a short time frame — a classic boom‑and‑bust dynamic.
By calling Bitcoin a “digital Labubu,” Ameriks suggested that BTC shares key traits with speculative collectibles: rapid price appreciation driven largely by sentiment and scarcity narratives, followed by the risk of an equally violent reversal when enthusiasm fades.
Ameriks’ criticism centers on Bitcoin’s lack of traditional investment characteristics. He argued that BTC does not generate income, does not compound returns in the way dividend‑paying stocks or interest‑bearing bonds do, and offers no underlying cash flow that can be modeled or discounted. In his view, that places Bitcoin at the speculative end of the risk spectrum, rather than in the category of long‑term, fundamentals‑based investments.
This line of reasoning echoes the long‑standing position of prominent value investors like Warren Buffett and the late Charlie Munger, who have repeatedly highlighted that Bitcoin does not produce earnings or yield, making it difficult to justify as a core holding through a conventional valuation lens.
Vanguard’s cautious approach to crypto
Ameriks’ comments arrive soon after a notable shift at Vanguard. The asset manager, which oversees more than $12 trillion in assets, recently began allowing clients to buy and hold Bitcoin and other cryptocurrency exchange‑traded funds (ETFs) on its platform.
However, Ameriks emphasized that this access does not equal endorsement. According to him, Vanguard is merely providing the infrastructure for clients who insist on exposure, while deliberately refraining from giving them guidance on whether to buy, sell, or which specific tokens or funds to choose. In other words, the firm is drawing a sharp line between operational access and investment advice.
This stance distinguishes Vanguard from several of its largest competitors. BlackRock, Invesco, and Franklin Templeton have all launched crypto‑focused ETFs, capitalizing on the wave of institutional and retail interest in digital assets. The financial incentives are clear: BlackRock’s spot Bitcoin ETF, IBIT, has become one of its most profitable funds, generating hundreds of millions of dollars annually in fees.
Vanguard, by contrast, has opted not to introduce its own crypto products, despite the obvious revenue opportunity. The firm’s position underscores its emphasis on long‑term, broadly diversified, low‑cost portfolios and its skepticism toward assets it sees as speculative or lacking intrinsic value.
Technical picture: Bitcoin slips into bearish territory
From a technical standpoint, Bitcoin’s price action has deteriorated in recent sessions. On the daily chart, BTC has fallen below the Supertrend indicator — a widely followed tool that helps traders identify the dominant market direction. Trading beneath the Supertrend often signals that sellers have regained control and that rallies may be met with renewed selling pressure.
At the same time, Bitcoin is now trading under its 50‑day Exponential Moving Average (EMA). The 50‑day EMA is a key medium‑term trend gauge for many market participants; a sustained break below it is typically interpreted as a loss of upward momentum and a warning that the prior bullish trend could be reversing or entering a consolidation phase.
More concerning for bulls is the appearance of a classic bearish continuation formation on the chart: the bear flag.
Bear flag pattern: why traders are nervous
A bear flag forms after a sharp downward move (the “flagpole”), followed by a relatively tight, upward‑sloping or sideways consolidation (the “flag”). This pattern often suggests that the market is taking a brief pause before resuming the prior downtrend.
Analysts observing Bitcoin’s current structure argue that the recent drop from the highs, followed by a constrained consolidation range, fits this profile. If the pattern completes, it could signal another leg lower, as sellers press the advantage and buyers retreat.
Based on this setup, some technical traders are eyeing the next major support region around $75,000, identified via Murrey Math Lines — a method that divides price into mathematically derived support and resistance zones. This level is being framed as a potential “ultimate support” in the current corrective phase.
However, there is also a clear invalidation point for this bearish scenario. A decisive break back above the major support‑and‑resistance pivot near $100,000 would undermine the bear flag thesis and suggest that bulls have reclaimed control. Such a move would not only erase the recent technical damage but could also reignite talk of new all‑time highs.
How institutional caution shapes the Bitcoin narrative
The clash between Bitcoin’s strong long‑term price performance and the reservations of institutions like Vanguard shapes the broader narrative around digital assets. On one side, there is a growing infrastructure of ETFs, custodians, and derivatives markets designed to make BTC more accessible and “institution‑friendly.” On the other, conservative asset managers and traditional investors question whether this accessibility has translated into genuine, fundamentals‑based adoption.
Vanguard’s refusal to launch a dedicated crypto ETF, despite offering access to competitors’ funds, sends a signal to its predominantly long‑term, retirement‑oriented client base. It implies that, in the company’s framework, Bitcoin remains closer to a speculative side bet than to a core holding akin to broad stock or bond funds.
This cautious positioning has ripple effects. Many large pension funds, endowments, and conservative wealth managers look to companies like Vanguard for cues on what is considered appropriate for long‑horizon portfolios. As long as these gatekeepers remain skeptical, Bitcoin may struggle to achieve the same status as equities or government bonds within mainstream asset allocation models.
Speculation vs. store of value: the unresolved debate
Ameriks’ “digital Labubu” remark taps into a broader, unresolved dispute: is Bitcoin primarily a speculative instrument driven by narrative and momentum, or is it maturing into a durable store of value?
Critics highlight the extreme volatility, periodic 50–80% drawdowns, and the tendency for price to track broader risk sentiment, especially during episodes of market stress. From that angle, BTC often behaves more like a high‑beta tech stock or a collectible than like a stable hedge.
Supporters counter that Bitcoin’s strictly limited supply, decentralization, and growing institutional infrastructure make it a unique form of digital scarcity. They argue that, over long timeframes, Bitcoin has outperformed many traditional assets, and that short‑term price swings are the cost of holding an emerging monetary asset still finding its place in the global system.
The Labubu analogy captures the skeptic’s fear: that Bitcoin’s value is ultimately based on collective enthusiasm and cultural trend, much like a toy craze, rather than on cash flows or measurable productivity.
What the $75,000 and $100,000 levels really mean
The focus on $75,000 as a key support and $100,000 as a major pivot isn’t just chartist trivia; these zones shape behavior. Traders and investors often anchor their expectations to such levels, which can become self‑fulfilling in the short term.
If BTC approaches $75,000, dip‑buyers who believe in the long‑term story may see it as a discount opportunity, while leveraged traders may be forced to liquidate, amplifying volatility. A clean rebound from that area could be interpreted as proof that long‑term holders still dominate and are willing to accumulate on weakness.
Conversely, a sustained move above $100,000 would have psychological and technical significance. It would suggest that the recent correction was a pause in a broader bull market rather than the start of a deeper bear phase. It could also embolden ETF inflows and bring in latecomers who were waiting for “confirmation” before entering the market.
Risk management in an era of ‘digital collectibles’
For individual investors, Ameriks’ comments and the current technical setup highlight a basic reality: Bitcoin may offer outsized upside, but it also carries substantial downside and timing risk. Treating it like a stable bond or a blue‑chip dividend stock is likely to lead to misaligned expectations.
Prudent investors who choose to hold BTC often do so as a small allocation within a diversified portfolio, with the recognition that it could be highly volatile and may experience multi‑year periods of underperformance. Position sizing, time horizon, and emotional discipline become crucial, especially when headlines swing from euphoria at record highs to alarm when bearish patterns emerge.
The “digital Labubu” label is a reminder that, without income or cash flow to anchor valuations, price can be driven for long stretches by sentiment, liquidity conditions, and macro narratives — all of which can change quickly.
The broader macro backdrop still matters
Bitcoin’s latest decline alongside U.S. equities underlines another key point: macro conditions remain a powerful driver of crypto markets. Rising or falling interest rate expectations, shifts in inflation forecasts, and changing risk appetite in tech and growth stocks often spill over into BTC.
If fears around AI‑driven bubbles intensify and push investors toward safer assets, Bitcoin could face additional pressure, regardless of its on‑chain metrics or long‑term adoption trends. Conversely, if risk appetite returns and liquidity remains abundant, BTC could recover, potentially invalidating the current bearish configuration.
In that sense, Bitcoin is caught between two worlds: marketed by some as “digital gold” but still trading, in many episodes, like a high‑beta risk asset deeply sensitive to broader market moods.
A market shaped by conviction and skepticism
The current moment encapsulates Bitcoin’s paradox. On one hand, it has achieved institutional access through ETFs and platforms operated by some of the world’s largest asset managers. On the other, leading voices at those same firms openly question its role and liken it to speculative fads.
While technicians warn about bear flags and downside targets, long‑term believers continue to argue that each drawdown is a temporary setback in a much larger adoption curve. Between these poles sits a growing group of investors who neither fully embrace nor fully reject Bitcoin, but treat it as a high‑risk, high‑reward satellite position rather than a portfolio cornerstone.
Whether Bitcoin ultimately proves more like a transient toy craze or a durable digital asset will depend on how it weathers these cycles — and whether, over time, it can convince more skeptics that its value extends beyond the latest speculative mania.