Morgan Stanley is the first large U.S. bank to give its wealth management customers a way to buy bitcoin funds.
The large bank, a giant in investment and wealth management with $4 trillion in total assets under management, told its people in a Wednesday message that they are creating three funds that give ownership of bitcoin, according to insiders.
The move is a big step for the mainstream adoption of bitcoin as an asset, and was made by Morgan Stanley after their clients demanded access to the digital asset, said the sources, who did not want to be identified.
Bitcoin’s recent rally has put pressure on Wall Street firms to consider jumping into the new asset class.
But, for now, the company is only letting its top clients invest into the asset: The bank considers it only appropriate for investors with “greater risk tolerance” and who have at least $2 million in funds at the bank. While investment firms need $5 million in assets to qualify. And for both, the accounts must be older than 6 months.
But even if clients have the account and assets to get access to the new funds, Morgan Stanley is capping their bitcoin investments to 2.5% of total net worth.
Two of the funds being created are from Galaxy Digital, while the last is a partnership between bitcoin firm NYDIG and FS Investments.
The FS NYDIG Select Fund and Galaxy Bitcoin Fund LP require a minimum of $25,000, while the Galaxy Institutional Bitcoin Fund LP requires $5 million.
Clients can possibly make investments next month, after the bank’s advisors finish training tied to the new offerings, said sources.
Meanwhile, earlier this month, JPMorgan filed official papers related to their new investment linked to a basket of crypto-exposed stocks like MicroStrategy, the firm that holds a significant amount of bitcoin, and payments company Square.