Wall Street investment banking giant Morgan Stanley’s European-focused fund submitted documents to the U.S. Securities and Exchange Commission (SEC) on Tuesday, adding language that the company may invest in a Bitcoin spot ETF. In addition, sources revealed today that Morgan Stanley is planning to add a BTC spot ETF product to its brokerage platform.
Morgan Stanley’s Europe Opportunity Fund, a subsidiary of the banking giant, submitted an updated N-1A form to the SEC on the 27th, indicating that the fund may invest in a Bitcoin spot ETF, although the investment amount in Bitcoin must be below 25% of the fund’s assets. (The fund currently has $142 million in assets).
According to The Block, the fund has previously held shares of Grayscale’s GBTC and currently focuses primarily on investing in European companies. With the approval of GBTC’s conversion to a Bitcoin spot ETF in January of this year, the new disclosure added by Morgan Stanley may be a precautionary measure, but it is also likely that they are genuinely interested in investing in a Bitcoin ETF.
Eric Balchunas, a senior ETF analyst at Bloomberg, suggests that the addition of Bitcoin disclosure by the fund may be a defensive measure to prevent the fund from encountering a Bitcoin ETF without disclosure. However, due to the low inflow of funds into the fund in recent years, the disclosure of a potential investment in a Bitcoin ETF may also be a growth strategy, so “this may just be looking for a little excitement, a little advantage,” Balchunas added.
He estimates that the fund’s exposure to the Bitcoin ETF will not exceed 2% of the fund’s assets, and he believes that it is reasonable for the Appleseed Mutual Fund to allocate 1.1% of its assets to Bitcoin. Balchunas further pointed out that Morgan Stanley, which manages over $150 billion in assets, is planning to allow its clients to invest in a Bitcoin spot ETF. According to Coindesk, the company is conducting due diligence to add a Bitcoin spot ETF product to its brokerage platform.
One of the sources stated that as one of the largest brokerage firms in the United States, Morgan Stanley has been evaluating the provision of such products to its clients since the SEC approved the listing of Bitcoin spot ETFs in January.
Although Bitcoin spot ETFs listed in the United States have attracted billions of dollars in funds, the investment gate for mainstream investors cannot truly open until Bitcoin spot ETF products are available on large registered investment advisor (RIA) networks and brokerage platforms (such as those affiliated with Merrill Lynch, Morgan Stanley, and Wells Fargo, among others).
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