As a seasoned financial analyst with over two decades of experience in the industry, I have witnessed the evolution of investment trends from the dot-com boom to the global financial crisis and now to the rise of cryptocurrencies like Bitcoin. The recent move by Morgan Stanley to offer spot Bitcoin ETFs to their clients is not surprising, given the growing demand for digital assets among retail investors.
Starting from Wednesday, investment advisors at the $1.3 trillion asset manager Morgan Stanley will start offering Bitcoin exchange-traded funds (ETFs) to their clients. It is expected that banking giants like Wells Fargo and UBS may soon follow suit, enabling more of their clients to invest in Bitcoin.
Wells Fargo Likely to Recommend Bitcoin ETFs To Clients
It appears that Wells Fargo, a prominent banking institution, might be considering enabling its financial advisors to suggest Bitcoin ETFs to selected clients, much like how Morgan Stanley has authorized its 15,000 brokers to do so within their client’s investment portfolios.
Multiple banking insiders anticipate that they will soon enter the competition among investment banks, aiming to capitalize on increasing client interest in investing in Bitcoin. According to cryptocurrency expert Andrew Abacus of AP Andrews, this development mirrors his earlier report in April about Morgan Stanley potentially providing access to Bitcoin Exchange-Traded Funds (ETFs).
He mentioned that Wells Fargo might soon provide access to additional Exchange-Traded Funds, in addition to the BlackRock’s iShares Bitcoin Trust and Fidelity’s Wise Origin Bitcoin Fund. He anticipates that the complete platform approval could take place within the next month.
Currently, Morgan Stanley allows clients to invest in Bitcoin ETFs through their brokerage accounts, but not via advisory accounts. This was confirmed by a head of private clients and family offices. Notably, some teams manage 40% of total client assets through advisory accounts, while 60% are handled through brokerage accounts.
Former SEC Official Reacts To Morgan Stanley’s Move
Previously serving as the Head of Enforcement at the Securities and Exchange Commission (SEC), John Reed Stark criticized Morgan Stanley’s move to enable investment advisors to propose Bitcoin ETFs to their clients. He believes that these certified financial professionals (CFPs) could potentially risk losing their CFP certifications due to this action.
Moving forward, Stark maintained his skepticism towards cryptocurrencies, emphasizing potential risks for Morgan Stanley’s retail investors due to the inherent uncertainties and high-risk nature of crypto-asset investments. He referred to the recently implemented changes in the CFP Board’s Sanction Guidelines, Fitness Standards, and Procedural Rules, which became effective on July 1 this year.
As a researcher, I’ve observed that the U.S. Securities and Exchange Commission has approved funds like the BlackRock and Fidelity Bitcoin ETFs, which open up investment opportunities for both retail and institutional investors. This approval is significant as it encourages the widespread adoption of Bitcoin. In particular, IBIT, managed by BlackRock, stands out with major stakeholders such as Millennium Management, Capula Management, and Schonfeld Strategic Advisors holding the largest shares. Interestingly, even amid market volatility, the BlackRock Ethereum ETF has been experiencing a surge in inflows.
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2024-08-07 19:54