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Morgan Stanley (MS) to Offer Clients Access to Bitcoin Funds

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Morgan Stanley (MS - Free Report) will be the first major U.S. bank to provide its clients with an avenue of bitcoin funds. This news was first reported by CNBC.

Via an internal memo, Morgan Stanley informed its financial advisors that it was granting access to three funds that will facilitate ownership of the flagship cryptocurrency. This decision was prompted by its clients’ demand for exposure to the same.

The New York-based investment bank is only allowing its wealthier clients an access to the volatile bitcoin funds. The customers with at least $2 million in assets and investment firms with minimum $5 million at the bank qualify for such an access. Besides, in both cases, the accounts should be at least six months old.

Even for those U.S. investors who are accredited with the requisite assets for qualification, Morgan Stanley is curtailing bitcoin investments to 2.5% of their total net worth.

Galaxy Digital, a cryptocurrency firm founded by Michael Novogratz, will be offering the two bitcoin funds. The third fund is a joint initiative among asset managers, FS Investments and the bitcoin company NYDIG.

Clients will be allowed to start investing in these funds beginning April 2021 after the bank’s financial advisors finish imparting training courses tied to the new offerings.

Such an effort will likely bolster the world’s most popular cryptocurrency asset prospects further, at least on grounds that Morgan Stanley with a massive global footprint is garnering the crypto access to its clients.

Investors have been flocking to the flagship cryptocurrency on the back of acceptance from Elon Musk’s Tesla, Inc. (TSLA - Free Report) and Square, Inc. (SQ - Free Report) . These companies are moving a portion of cash reserves into cryptocurrencies as digital assets are becoming the new conventional.

Earlier in February, The Bank of New York Mellon Corporation (BK - Free Report) became the first global custody bank to announce plans to form a new unit, named Digital Assets to help its institutional clients hold, transfer and issue digital assets. Pending product analysis and approvals, the company is expected to start offering these services later this year.

Shares of Morgan Stanley have rallied 73.4% over the past six months, underperforming the growth of 75.6% of the industry it belongs to.

Morgan Stanley currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here

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