We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Should You Buy Bitcoin ETFs Following Goldman and Morgan Stanley?
Read MoreHide Full Article
In recent years, Bitcoin has undergone a tectonic shift in its reputation as an investment asset. Once infamous for its extreme price swings and high volatility, the cryptocurrency has shown signs of stability, with volatility subsiding over the past decade.
Investors should note that Goldman Sachs and Morgan Stanley invested huge sums into spot bitcoin exchange-traded funds (ETFs) during the second quarter of 2024, according to regulatory filings, as quoted on Reuters. Together, the banks acquired over $600 million in these products, which began trading in January 2024.
Goldman Sachs' Holdings
Goldman Sachs reported acquiring about $418 million in various bitcoin ETFs through its quarterly 13-F filing with the Securities and Exchange Commission. This includes a notable $238 million stake in the iShares Bitcoin Trust, representing nearly 7 million shares as of Jun 30. Additionally, Goldman took substantial positions in the Fidelity Wise Origin Bitcoin ETF (FBTC) , Invesco Galaxy Bitcoin ETF (BTCO) , and smaller amounts in other newly launched bitcoin ETFs.
Morgan Stanley's Investments
Morgan Stanley disclosed a $188 million investment in BlackRock’s iShares Bitcoin ETF (IBIT) , comprising 5.5 million shares as of Jun 30. The bank also held smaller stakes in the Ark 21Shares Bitcoin ETF (ARKB) and the Grayscale Bitcoin Trust (GBTC) .
Insights from 13-F Filings
The 13-F filings provide a glimpse into institutional investor positions at the end of each quarter, although they may not reflect current holdings. Despite the growing presence of institutions, ETF issuers and analysts note that individual investors still rule the market.
Hedge Funds Adjust Their Positions
Several hedge funds have adjusted their holdings in bitcoin ETFs. Hunting Hill Global Capital reduced its stakes in Grayscale and Fidelity ETFs but increased its investment in the Bitwise Bitcoin ETF and established a new position in BlackRock’s ETF.
Millennium Management LLC also tweaked holdings, reducing its positions in three of the five bitcoin ETFs it initially held while increasing its holdings in the Bitwise product. Overall, Millennium's investment in bitcoin ETFs fell from $2 billion at the end of the first quarter to about $1.15 billion by the end of the second quarter.
Why So Much Craze?
Since the launch of the first Bitcoin ETFs on Jan 11, the asset has surged about 35%, even hitting a level of $70,000. The ETFs represent a landmark in Bitcoin’s journey, offering both retail and institutional investors a regulated and accessible means to invest in the cryptocurrency. This development not only enhances liquidity but also contributes to price stability.
Some market watchers suggest that a growing number of long-term investors are entering the market for asset allocation and diversification purposes, recognizing Bitcoin's potential as a store of value and hedge against traditional financial assets.
Safety vs. Volatility
Despite its recent gains and increasing mainstream acceptance, Bitcoin remains a complex asset that can record acute price swings. Bitcoin’s historical volatility cannot be overlooked.
Image: Bigstock
Should You Buy Bitcoin ETFs Following Goldman and Morgan Stanley?
In recent years, Bitcoin has undergone a tectonic shift in its reputation as an investment asset. Once infamous for its extreme price swings and high volatility, the cryptocurrency has shown signs of stability, with volatility subsiding over the past decade.
Investors should note that Goldman Sachs and Morgan Stanley invested huge sums into spot bitcoin exchange-traded funds (ETFs) during the second quarter of 2024, according to regulatory filings, as quoted on Reuters. Together, the banks acquired over $600 million in these products, which began trading in January 2024.
Goldman Sachs' Holdings
Goldman Sachs reported acquiring about $418 million in various bitcoin ETFs through its quarterly 13-F filing with the Securities and Exchange Commission. This includes a notable $238 million stake in the iShares Bitcoin Trust, representing nearly 7 million shares as of Jun 30. Additionally, Goldman took substantial positions in the Fidelity Wise Origin Bitcoin ETF (FBTC) , Invesco Galaxy Bitcoin ETF (BTCO) , and smaller amounts in other newly launched bitcoin ETFs.
Morgan Stanley's Investments
Morgan Stanley disclosed a $188 million investment in BlackRock’s iShares Bitcoin ETF (IBIT) , comprising 5.5 million shares as of Jun 30. The bank also held smaller stakes in the Ark 21Shares Bitcoin ETF (ARKB) and the Grayscale Bitcoin Trust (GBTC) .
Insights from 13-F Filings
The 13-F filings provide a glimpse into institutional investor positions at the end of each quarter, although they may not reflect current holdings. Despite the growing presence of institutions, ETF issuers and analysts note that individual investors still rule the market.
Hedge Funds Adjust Their Positions
Several hedge funds have adjusted their holdings in bitcoin ETFs. Hunting Hill Global Capital reduced its stakes in Grayscale and Fidelity ETFs but increased its investment in the Bitwise Bitcoin ETF and established a new position in BlackRock’s ETF.
Millennium Management LLC also tweaked holdings, reducing its positions in three of the five bitcoin ETFs it initially held while increasing its holdings in the Bitwise product. Overall, Millennium's investment in bitcoin ETFs fell from $2 billion at the end of the first quarter to about $1.15 billion by the end of the second quarter.
Why So Much Craze?
Since the launch of the first Bitcoin ETFs on Jan 11, the asset has surged about 35%, even hitting a level of $70,000. The ETFs represent a landmark in Bitcoin’s journey, offering both retail and institutional investors a regulated and accessible means to invest in the cryptocurrency. This development not only enhances liquidity but also contributes to price stability.
Some market watchers suggest that a growing number of long-term investors are entering the market for asset allocation and diversification purposes, recognizing Bitcoin's potential as a store of value and hedge against traditional financial assets.
Safety vs. Volatility
Despite its recent gains and increasing mainstream acceptance, Bitcoin remains a complex asset that can record acute price swings. Bitcoin’s historical volatility cannot be overlooked.