Cryptocurrency prices, incl Bitcoin (CRYPTO: BTC)have been hovering over the past few months as investors have shifted from more speculative investments to safer havens. With the threat of tariffs once again rearing its ugly head and investors worried about how artificial intelligence (AI) might disrupt established companies and industries, the interest in owning digital currencies is fading.
The bottom line is that Bitcoin is falling, and I think there’s a case for investors to put their money into a broad market exchange-traded fund (ETF). of the Vanguard S&P 500 ETF(NYSEMKT: VOO ) My personal favorite. Here’s why it’s a better buy than Bitcoin this year.
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It wasn’t that long ago that investors had an insatiable appetite for risky investments. Consider that the price of Bitcoin reached an all-time high of more than $126,500 in October, before the latest crypto sell-off brought its price down to around $69,000 as of this writing.
There isn’t a single factor that caused the pullback, but rather general skepticism about some AI stocks, uncertainty about the economy amid geopolitical uncertainties, and President Donald Trump announcing new global tariffs of as much as 15% — just after the Supreme Court overturned his previous term’s tariffs.
Additionally, layoffs in January were the highest this month in 17 years, and the World Economic Forum recently stated that 41% of the world’s companies expect to cut their workforce in the next five years due to artificial intelligence.
Bitcoin has been stagnating in a post-Covid world where tech stocks soared, and early AI optimism helped boost the digital currency’s prices. But now some investors sense that the economic winds are about to turn, and they’re piling into Bitcoin, along with many other cryptocurrencies and other speculative investments, including quantum computing stocks.
Source: YCharts.
While Bitcoin is down about 23% over the past year, the Vanguard S&P 500 ETF has slowly and steadily gained more than 16%.
Follows the fund S&P 500So if the market is doing well, the fund is also doing well. The advantage of spreading your money across the largest 500 publicly traded companies in the United States is that you have the ability to take advantage of many areas of growth, including AI, healthcare, consumer spending, industrial manufacturing and more.
This strategy has historically been very successful. Since the fund’s inception in 2010, it has had an annual average return of 14.8%. There’s no guarantee you’ll get that back in any given year, of course, but it shows that fund diversification can lead to impressive returns when different economic sectors do well.
Some investors don’t like passive ETF investing and want to personally choose stocks and cryptos for their portfolios. I understand the appeal, and there is nothing wrong with this strategy. But it becomes difficult when, as now, the direction of the economy and many are in the dust.
That’s why buying this Vanguard ETF makes sense right now. While other investors are trying to figure out which sectors and companies will benefit or be destroyed by AI, or how tariffs will affect industrial companies in the coming years, you can instead put your money in a fund that spreads your investments across a basket of stocks.
Not only will you be better diversified, but you’ll also pay a much lower annual expense ratio of 0.41% compared to the average S&P 500 fund fee of 0.03%. This means that for every $1,000 invested in the fund, you will pay only $0.30 a year.
I don’t think Bitcoin is a bad investment, but with 2026 already off to an uncertain start, getting into the Vanguard S&P 500 ETF may look like a smart move a few years from now.
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Chris Niger holds positions in the Vanguard S&P 500 ETF. The Motley Fool has and recommends positions in Bitcoin and the Vanguard S&P 500 ETF. Motley Fool has a disclosure policy.
Best Buy in 2026: Bitcoin or Broad Market ETF? The answer was not clear for long-term investors
