In brief

  • Morgan Stanley has been planning to offer Bitcoin exposure to clients.
  • New filings reveal the bank will allow certain mutual funds to invest “indirectly” in Bitcoin.

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Morgan Stanley will allow certain mutual funds to invest “indirectly” in Bitcoin through cash settled Bitcoin futures and the Grayscale Bitcoin Trust, according to documents filed with the SEC Thursday morning.

Twelve funds under the heading of the bank’s Institutional Fund will be allowed to access these Bitcoin-related products, as will the Institutional Fund Trust, Insight Fund, Variable Insurance Fund, and Europe Opportunity Fund.

The value of cash settled Bitcoin futures has to do with the price of Bitcoin, but investors who trade them aren’t actually handling the asset itself. Similarly, the Grayscale Bitcoin Trust is an investment vehicle that grants access to Bitcoin without asking investors to hold it directly. It’s a little like an ETF, though with some important distinctions (like a lack of a redemption mechanism).

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The documents state that each fund can put up to 25% of its total assets into these products via subsidiaries.

Today’s filings are part of a larger wave of institutional moves into Bitcoin-related investment products; BlackRock, Goldman Sachs, and JP Morgan have all teased offerings in the crypto space.

Last month, CNBC reported that Morgan Stanley would allow its wealthier clients access to Bitcoin funds from Galaxy Digital and NYDIG.

And Morgan Stanley is already exposed to crypto through its 10% stake in the tech company MicroStrategy, which holds a significant amount of its treasury in Bitcoin.

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