Morgan Stanley is gearing up to be the first major US bank to offer wealthy clients access to bitcoin-based funds. Writes about this CNBC, citing sources.
According to the publication, the investment bank with $ 4 trillion in assets today announced to its financial advisors in an internal notice of the opening of access to three funds that allow owning bitcoin. Two funds are owned by Galaxy Digital, the third is a joint venture between FS Investments and NYDIG. In two of them, investments are accepted from $ 25,000, and in one of the Galaxy Digital funds – from $ 5 million. According to sources, the bank took this step after clients’ requests for access to cryptocurrency.
In the foreseeable future, only Morgan Stanley’s wealthy clients will be able to work with the service, having transferred at least $ 2 million under its management. The bank explains this by the fact that such clients must be able to cope with the increased risks of investing in cryptocurrencies. For investment companies, the minimum limit is $ 5 million. In both cases, the account must be more than six months old. At the same time, Morgan Stanley will not allow even eligible clients to invest in bitcoin more than 2.5% of their capital.
Morgan Stanley is expected to open the service next month, after its employees receive the necessary training. Morgan Stanley’s Wealth Clients Division has 16,000 consultants and $ 2.3 trillion in assets under management.
The veracity of this information was confirmed by the founder of Galaxy Digital Mike Novogratz on Twitter.
“Galaxy is delighted to partner with Morgan Stanley, the first US bank to provide high-value clients with access to bitcoin funds,” he wrote.
Cryptocurrencies on the doorstep
Earlier today, Morgan Stanley’s Wealth Clients Division issued a note urging them to turn their attention to cryptocurrencies as an emerging investment asset class.
“For speculative investment opportunities to rise to the level of an investable asset class that can play a role in diversifying investment portfolios, qualitative progress is required on both the supply and demand side. We believe that cryptocurrencies are approaching this threshold. Strengthening regulatory frameworks, increasing liquidity, product availability and growing investor interest – especially institutional investors – have come together , «wrote banking analysts.
At the same time, they noted that cryptocurrencies, like any asset remaining in the speculative phase , have many risks. On this basis, Morgan Stanley calculated that the share of cryptocurrencies in an investor’s portfolio should not exceed 2.5%.
“It’s important to remember that we are only at the top of the first round,” the authors add.
In conclusion, they warn that they do not recommend buying cryptocurrencies directly due to persisting problems with determining their real value and executing transactions.
“For qualified investors who are willing to work with cryptocurrencies, we suggest starting with publicly traded products – preferably based on multiple assets and potentially with access to growth opportunities through venture capital / private equity investments in the blockchain ecosystem ,” says Morgan Stanley.
