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Morgan Stanley is the latest among traditional banks to make another series of investments in the cryptocurrency space by opting for exposure to Bitcoin (BTC) through the regulated investment vehicle Grayscale Bitcoin Trust (GBTC).
Morgan Stanley Invests in Grayscale's Bitcoin Trust
According to a recent filing with the U.S. Securities and Exchange Commission (SEC), investment banking giant Morgan Stanley has purchased more than one million shares of Grayscale Bitcoin Trust (GBTC).
Distributed among 31 Morgan Stanley Funds, the largest holding comes from Morgan’s Insight Fund with over 928,051 GBTC worth around $36 million. In addition, Institutional Fund Inc., Variable Insurance Fund Inc., and the Institutional Fund Trust among others has also invested in Grayscale’s Trust.
The investments don't really come as a surprise. Back in April, the Wall Street giant filed with the regulatory agency seeking exposure to Bitcoin (BTC) to 12 of its institutional funds.
In late June, a filing with the United States Securities and Exchange Commission revealed that one of the bank’s funds, the Morgan Stanley Europe Opportunity Fund, owned about GBTC 28,298 shares worth $1.3 million through its Europe Opportunity Funds. Two months prior, the firm added Bitcoin exposure to 12 of its funds through GBTC and cash-settled futures.
Simplifying Bitcoin Exposure
The Grayscale Bitcoin Trust (GBTC) is an investment product that allows investors to gain exposure to the price of Bitcoin (BTC) without holding the digital asset itself through traditional investment vehicles.
Investing in GBTC is indirectly investing in BTC since the product reflects the original price performance of the cryptocurrency. However, GBTC often trades for much higher or lower than the original cost of the digital asset it's designed to track.
Data from YCharts indicates that the digital asset is currently trading at a 13% discount since March. This means investors have been able to buy GBTC for less than Bitcoin’s price, a byproduct of the six-month holding period.