Morgan Stanley plans to offer Bitcoin funds to its wealthiest customers. CNBC reported on March 17th that the investment bank, which manages $4 trillion of client assets, told its financial advisors in an internal memo that it would offer three separate Bitcoin funds to the wealthiest of its clients as part of its wealth management service starting next month. Per the report, this is the first time that a United States bank offers funds backed by Bitcoin to its customers.
The bank reportedly plans to launch access to three separate Bitcoin funds. The decision to offer these products is motivated by the demand for exposure to Bitcoin coming from the institution's clients looking to get off the sidelines of the bull market.
Strict access restrictions are put in place for the products, as Morgan Stanley reportedly finds only people with an “aggressive risk tolerance,' meaning at least $2 million of assets to their name, are suitable candidates to access the funds. For investment firms, a minimum entrance level of $5 million held at the bank is imposed.
Those accredited United States investors who hold with brokerage accounts at Morgan Stanley and meet the requirements to be allowed to buy shares will, however, not be able to place more than 2.5% of their total net worth there. Michael Novogratz’s crypto bank Galaxy Digital manages two of the three Bitcoin funds offered, with the third one being a product jointly-developed by asset manager FS Investments and Bitcoin financial services firm New York Digital Investment Group. The minimum investment for the Galaxy Bitcoin Fund LP and FS NYDIG Select Fund is $25,000, while the minimum investment for the Galaxy Institutional Bitcoin Fund LP is $5 million.
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