Morgan Stanley told its advisers that they can ask qualified clients to buy shares in two Bitcoin ETFs, according to in a report from CNBC.
Morgan Stanley is the first house to allow advisers to actively push investments. So far, some wires AND IBDs have allowed qualified advisors to offer approved ETFs to certain brokerage account clients, but only if the clients request it, short stop request.
A source with knowledge of Morgan Stanley's policies confirmed the accuracy of CNBC Report to WealthManagement.com.
Getting products approved on wirehouse platforms is an “extremely arduous task,” according to Neil Bathon, founder and partner at FUSE Research Network. “There are all kinds of groups — due diligence, compliance, business management, field oversight, etc. — within Morgan Stanley that need to be comfortable with the notion that the investment strategy will deliver as promised. And crypto/bitcoin it is still a mysterious and volatile asset class for many investors.”
According to the report, Morgan Stanley will allow its 15,000 brokers to sell BlackRock's iShares Bitcoin Trust and Fidelity's Wise Origin Bitcoin Fund, two of the 11 spot bitcoin ETFs the SEC approved earlier this year. In general, counselors have has been careful circle using the products from the outset, or prohibiting their use or allowing them to be sold only at the request of a client after advisors have completed the required training on the use of spot Bitcoin ETFs. They have received the same attitude on recently launched Ethereum ETFs.
The report added that Morgan Stanley made the move in response to “client demand” and in “an effort to pursue an emerging market for digital assets.”
According to sources cited by CNBC, only clients with a net worth of $1.5 million who have an “aggressive risk tolerance” and a “willingness to make speculative investments” are eligible for the bitcoin ETF request. Bitcoin ETFs are for clients with taxable brokerage accounts, not retirement accounts.
Bathon added that he wouldn't be surprised if other TV bureaus followed Morgan Stanley's lead, but Goldman Sachs, JPMorgan, Bank of America and Wells Fargo all confirmed to CNBC that they have not changed their previous policies by prohibited their advisers from presenting them.
“Morgan Stanley is one of the most dominant firms in wealth management, so I think competing firms will absolutely follow suit – and are likely happy that Morgan Stanley has stepped into a market leadership role in terms of Bitcoin ,” Bathon said.
The price of Bitcoin has risen 35% since the ETFs began trading on January 11.