A view of the Morgan Stanley offices in Canary Wharf, London, UK
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Morgan Stanley is the first major US bank to provide its wealth management clients with access to bitcoin funds, CNBC has exclusively learned.
The investment bank, an asset management giant with $ 4 trillion in client assets, told its financial advisors in an internal memo on Wednesday that the bank is launching access to three funds that enable bitcoin ownership, according to people with direct knowledge of the matter. . .
The move, an important step towards bitcoin’s adoption as an asset class, was made by Morgan Stanley after customers demanded exposure to the cryptocurrency, the people said, who refused to be identified and shared details about the bank’s internal communications. Bitcoin’s rally in the past year has pressured Wall Street companies to consider entering the emerging asset class.
But for now, the bank is only giving its wealthier clients access to the volatile asset: the bank deems it suitable for those with “an aggressive risk tolerance” who own at least $ 2 million in assets owned by the company.
Some Limitations
Investment firms require a minimum of $ 5 million from the bank to qualify for the new stake. In either case, the accounts must be at least six months old.
And even for those accredited U.S. investors with brokerage accounts and enough assets to qualify, Morgan Stanley limits bitcoin investments to a whopping 2.5% of their total net worth, the people said.
Two of the funds on offer are from Galaxy Digital, the crypto company founded by Mike Novogratz, while the third is a joint effort between asset manager FS Investments and bitcoin firm NYDIG.
The Galaxy Bitcoin Fund LP and FS NYDIG Select Fund have a minimum investment of $ 25,000, while the Galaxy Institutional Bitcoin Fund LP has a minimum of $ 5 million.
Customers will likely be able to invest in next month, after the bank’s financial advisers complete training related to the new offering, the people said.
Goldman Sachs, JPMorgan Chase and Bank of America’s asset management divisions do not currently allow their advisors to offer direct bitcoin investments.
Earlier this month, JPMorgan filed documents pertaining to a new debt investment linked to a basket of crypto-exposed stocks such as MicroStrategy, the software company that holds bitcoin on its balance sheet, and payment company Square.