Updated 07 Apr, 2021

Morgan Stanley To Offer Clients Exposure to Bitcoin

Visa Embraces Cryptocurrency

 

Key Takeaways

  • Morgan Stanley to allow bitcoin exposure across 12 funds
  • The firm’s filing is part of a larger move to meet the rising demand for bitcoin-related products

Morgan Stanley Adds Exposure to Bitcoin

Through 12 mutual funds, the investment bank Morgan Stanley has added exposure to bitcoin, the world’s largest and most popular digital asset. In a filing with the Securities and Exchange Commission (SEC), the Wall Street bank has stated it plans to enable 12 of its mutual funds to hold bitcoin products.

According to the statement, the select funds “may have exposure to bitcoin indirectly through cash-settled futures or indirectly through investments in Grayscale Bitcoin Trust (BTC) (“GBTC”), a privately offered investment vehicle that invests in bitcoin.” Investors in these 12 funds that will be holding bitcoin-related products, will not have direct access to bitcoin on its own blockchain network and will not be able to handle the asset itself. Rather, the offered bitcoin exposure will allow investors to speculate with the price of bitcoin through bitcoin futures. Additionally, investors could purchase the investment vehicle Grayscale Bitcoin Trust which holds the digital asset, and that way they’ll be exposed to bitcoin’s price fluctuations.

WallStreet Mainstays to Offer Bitcoin Related Products

The statement by Morgan Stanley mentions that each of the institutional funds can put up to 25% of their total assets into the two bitcoin products. The step by the bank further advances efforts by investment firms to provide their clients with exposure to bitcoin. Presently, no bank has offered direct access to bitcoin due to compliance regulations. However, WallStreet mainstays like BlackRock, Goldman Sachs, and JPMorgan have already announced they are working on offering access to bitcoin-related products.

Morgan Stanley’s move to offer bitcoin exposure through these 12 funds comes soon after the investment bank allowed its wealthy clients to have access to Bitcoin funds. Near the end of March, Morgan Stanley approved 3 bitcoin funds that will be open to investors who have at least $2mn in assets held by the firm. The investment banking giant also owns bitcoin indirectly through its 10% stake in the software company MicroStrategy, which has more than half of its treasury in bitcoin.