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Morgan Stanley CEO says Bitcoin is not a fad


Cryptocurrencies and the underlying blockchain technology have proven their durability. However, digital assets are not in great demand among Morgan Stanley clients. The head of the financial conglomerate James Gorman stated this, according to CoinDesk.

“I don’t consider cryptocurrencies a fleeting fashion, I don’t think they will disappear soon. I don’t know how much Bitcoin should or shouldn’t cost. But these things are not going away. And the underlying blockchain technology is obviously quite real and powerful”. Gorman said during a teleconference following the results of the third quarter of 2021.

According to him, Morgan Stanley does not provide retail clients with direct access to digital assets. But allows them to invest in cryptocurrencies through various funds. The head of the conglomerate noted that such activities “are not a major part of the business.”

Opening access to Bitcoin funds

Previously in March, sources told CNBC about Morgan Stanley’s plans to open access to Bitcoin funds to accredited investors with a capital of at least $2 million. The bank limited investments in instruments to 2.5% of their equity.

Later in April, Morgan Stanley, in an application for the U.S. Securities and Exchange Commission (SEC), did not exclude the addition of derivatives for the first cryptocurrency to 12 of its own funds.

In June, asset managers New York Digital Investment Group (NYDIG) and FS Investments filed an application with the SEC for registration of a Bitcoin fund intended for Morgan Stanley clients.

Providing clients with the appropriate investment tools

Earlier, the financial conglomerate disclosed a position in the Grayscale Bitcoin Trust (GBTC) in the amount of $1.3 million. Subsequently, it increased investments in the Bitcoin trust through controlled structures like Morgan Stanley’s Insight Fund. The latter acquired GBTC shares for $27.7 million. Such investments can reach up to $25% of Assets Under Management (AUM), according to documents for the SEC.

Gorman’s words contrast with a recent statement by JPMorgan CEO Jamie Dimon, who stated that “Bitcoin is worth nothing”. The CEO of the holding stressed that his clients think differently, so the organization provides them with the appropriate tools for investment.

Recall that in September 2021, Morgan Stanley started forming a team that will focus on studying the impact of cryptocurrencies on stocks and fixed income instruments.

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