Morgan Stanley Explores Letting Its 15,000 Brokers Recommend Spot Bitcoin ETFs To Clients

Updated: 25 April 2024

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Morgan Stanley is considering expanding the sale of spot Bitcoin ETFs (exchange-traded funds) by giving its 15,000 brokers the ability to solicit customer purchases, AdvisorHub reported, citing two senior executives familiar with the matter.

The Wall Street giant has only sold Bitcoin ETFs on an unsolicited basis up until now, which means customers must approach their advisors to ask for spot Bitcoin ETFs to be included in their portfolios, the AdvisorHub story said.

Demand For Spot Bitcoin ETFs Could Surge

If advisors are allowed to recommend these crypto ETFs, it may boost demand, though the firm will also be exposed to additional liability. Morgan Stanley is thus trying to establish the necessary “guardrails” for the solicited purchases.

This due diligence includes gauging risk tolerance requirements, as well as allocation limits and trading frequency, one of the executives said. “We are going to make sure everybody has access to it,” the executive said. “We just want to do it in a controlled way,”

A similarly cautious approach is being taken by Merrill Lynch and Wells Fargo, which also only sell spot Bitcoin ETFs when requested by clients.

Morgan Stanley Has Huge Broker-Dealer Platform

Earlier this year, it was reported that Morgan Stanley is considering offering spot Bitcoin ETF products to investors via its massive brokerage platform.

LATEST: Morgan Stanley filed a prospectus to add #Bitcoin exposure in 2 of their funds.

– Morgan Stanley is seeking Bitcoin ETF exposure for twelve of its funds.
– With a massive $1.5 trillion in management, their move makes waves and will spark more and more interest.
– Their…

— Kyle Chassé (@kyle_chasse) April 23, 2024

Boasting over $150 billion in assets under management, Morgan Stanley’s wealth management unit is among the largest broker-dealer platforms in the US.

Its focus on newly-launched spot Bitcoin ETFs is fueled by the bank’s belief that their approval signals a “potential paradigm shift.” Head of digital asset markets Andrew Peel has said that digital assets will influence the future of finance and international trade.