Morgan Stanley is set to become the first major American bank to offer its wealth management clients access to bitcoin funds, CNBC reported Wednesday. This will allow certain clients ownership of the cryptocurrency.
The investment bank told its financial advisor in an internal memo on Wednesday about its plan to launch three funds. Two will be run by Galaxy Digital, the crypto firm founded by Mike Novogratz, while one will be jointly managed by FS Investments, an asset manager, and NYDIG, a bitcoin company.
The announcement comes amid a wave of institutional investors throwing their weight behind bitcoin, which has hit new highs of $61,742 on March 13.
Banks, however, have mostly stayed on the sidelines even as major companies such as Tesla and MasterCard announce their support for the digital asset.
Morgan Stanley is the first among the six biggest US banks to offer their clients access to bitcoin. The people CNBC spoke to said the move came after clients demanded exposure to the popular token.
The catch is that access is limited to rich clients with "an aggressive risk tolerance" on top of having at least $2 million in assets held by the firm. They can likely start making investments by next month, CNBC reported.
In 2017, Morgan Stanley CEO James Gorman voiced support for bitcoin. While speaking at a conference hosted by The Wall Street Journal, Gorman said he thought bitcoin was "certainly more than just a fad."
"It's obviously highly speculative, but it's not something that's inherently bad. It's a natural consequence of the whole blockchain technology."
On March 1, Goldman Sachs said it restarted its cryptocurrency trading desk amid a boom in bitcoin, Reuters first reported.
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