Morgan Stanley will be the first major Wall Street bank to allow its financial advisors to offer Bitcoin exchange-traded funds (ETFs), CNBC reported on August 2, citing sources familiar with the matter.
The decision allows Morgan Stanley’s more than 15,000 financial advisors to sell shares of BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity’s Wise Origin Bitcoin Fund (FBTC) – two of the most prominent ETFs with total inflows of approximately $30 billion – to clients with a net inflow. worth at least $1.5 million.
This move comes after months of due diligence, as the lender has been considering allowing its brokers to actively promote Bitcoin ETFs since April. At the time, sources said the bank was considering this move due to growing customer demand for these investment products. Previously, the bank’s customers had to initiate transactions to access these financial investments.
Customer criteria
Aside from the client’s high net worth, Morgan Stanley stated that the interested investor must demonstrate a substantial risk tolerance and interest in speculative investments.
Additionally, investments in these spot Bitcoin ETFs are limited to taxable investment accounts and not available for retirement accounts.
The bank will also monitor clients’ crypto holdings to avoid overexposure to the asset class.
Bitcoin ETFs
Market analysts view Morgan Stanley’s move as a positive development for the crypto industry, especially after the success of the Bitcoin ETF.
Nate Geraci, president of ETF Store, emphasized the importance of this shift, noting the exceptional success of spot Bitcoin ETFs. He said:
“Spot Bitcoin ETFs have broken industry launch records with one hand tied behind their back. These products are only now becoming available at major financial advice stores.”
The same goes for Bloomberg senior ETF analyst Eric Balchunas described the development as a “big deal” because the “lender advisors” manage $5.7 trillion in customer assets, the largest of any warehouse.