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Morgan Stanley's global headquarters in New York, USA. (Photo: New york Times)

Morgan Stanley to offer rich clients access to Bitcoin funds

Morgan Stanley's global headquarters in New York, USA. (Photo: New york Times)

Morgan Stanley plans to offer wealthy clients access to three funds that will enable ownership of Bitcoin, according to a person familiar with the matter.

A customer uses a bitcoin automated teller machine (ATM) in a kiosk Barcelona, Spain, on Tuesday, February 23, 2021. Bitcoin climbed, aided by supportive comments from Ark Investment Management’s Cathie Wood and news that Square Inc boosted its stake in the cryptocurrency.
(Photo: Bloomberg)

Galaxy Digital runs two of the funds, and the third is overseen by FS Investments and NYDIG, the person said, asking not to be identified because the move hasn’t been announced publicly.

Only wealthy clients with “an aggressive risk tolerance” and at least US$2 million held by the New York-based firm will have access to the funds. CNBC reported the decision earlier Wednesday.

Morgan Stanley and Co signage displays outside the bank’s headquarters in the Times Square neighbourhood of New York, USA, on Friday, February 22, 2019. US stocks rose along with Treasuries as investors awaited results from top-level trade talks between America and China. (Photo: Michael Nagle/Bloomberg)

‘Cryptocurrencies surged in popularity’

Wall Street banks have stayed mostly on the sidelines as cryptocurrencies surged in popularity. While futures contracts based on Bitcoin and Ether, the second-largest digital currency, are available at major exchanges, none of the six biggest US banks have until now offered their customers access.

Morgan Stanley Chief Executive Officer James Gorman was one of the first Wall Street leaders to lend credence to Bitcoin, saying in 2017 that it was more than just a fad. The firm flirted with the idea of trading a swap-based product tied to the cryptocurrency that could give clients synthetic exposure to the coin, but it ultimately didn’t proceed.

Morgan Stanley Chief Executive Officer James Gorman (File photo)

Morgan Stanley’s head of digital-asset markets, Andrew Peel, has said in recent months the bank has fielded more interest in Bitcoin from traditional financial firms.