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In an ambitious stride, Morgan Stanley is setting the stage to expand its Bitcoin exchange-traded funds (ETFs) offerings significantly. According to the latest report, the financial behemoth is poised to permit its approximately 15,000 brokers to recommend Bitcoin ETFs to clients proactively.
This move could dramatically widen consumer access and potentially boost the demand for these digital asset funds.
Morgan Stanley Chooses the Careful Approaches
Previously, since the regulatory green light in January, Morgan Stanley, like its industry counterparts, limited its Bitcoin ETF dealings to unsolicited transactions.
Clients interested in dipping their toes into the cryptocurrency pool had to initiate conversations with their advisors. This conservative approach mirrored the broader industry’s cautious entry into the crypto market.
Read more: How To Trade a Bitcoin ETF: A Step-by-Step Approach
Indeed, the decision to shift from a passive to an active solicitation model has its challenges. According to senior executives at Morgan Stanley, the firm is crafting “guardrails” to ensure this new strategy runs within a controlled environment. These safeguards include stringent risk tolerance assessments and caps on how much and how often clients can trade these products.
“We’re going to make sure we’re very careful about it. We are going to make sure everybody has access to it. We just want to do it in a controlled way,” one of Morgan Stanley’s executives explained.
Morgan Stanley’s careful planning reflects a broader hesitation across the financial sector to fully embrace cryptocurrencies despite their growing popularity.
Notably, peers such as Merrill Lynch and Wells Fargo have also introduced Bitcoin ETFs post-regulatory approval but continue to restrict access primarily to ultra-wealthy clients. For instance, Merrill requires a client to possess assets north of $10 million to engage in Bitcoin ETF transactions.
Read more: Crypto ETN vs. Crypto ETF: What Is the Difference?
Despite the excitement, another Morgan Stanley executive underscored the speculative nature of Bitcoin investments, tempering expectations.
“Our clients aren’t betting the ranch on Bitcoin. For most of those people, it’s quite interesting, so they put in a little bit of money,” the executive said.