Yerevan (CoinChapter.com) — Morgan Stanley is adding three Bitcoin funds to its investment platform in a move that would enable its rich clients to gain exposure to the emerging cryptocurrency market, according to an exclusive report by CNBC.
The investment bank, which holds $4 trillion worth of assets under management, told its financial advisors in an internal memo that it would add two cryptocurrency funds operated by Mike Novogratz’s Galaxy Digital and one fund supervised by NYDIG. While investors will be able to gain exposure in the Galaxy Bitcoin Fund LP and FS NYDIG Select Fund with a $25,000 investment, they will have to lock a minimum of $5 million for the Galaxy Institutional Bitcoin Fund LP.
Boarding the Bullish Ride
Morgan Stanley’s announcement came in the wake of Bitcoin’s relentless rally in the previous 12 months. The cryptocurrency plunged to $3,858 during the coronavirus-induced global market rout. Nevertheless, loose monetary policies and ultra-low interest rates boosted investors’ appetite for riskier assets, a sentiment that allowed Bitcoin to surge to as high as $61,778 just last week.
The cryptocurrency’s supersonic performance beat traditional safe-haven assets like fiat, bonds, and gold. Many billionaire investors, hedge fund managers, and corporations responded by readjusting a portion of their cash reserves to accommodate Bitcoin. That further prompted mainstream financial service firms, such as Morgan Stanley, PayPal, MasterCard, Visa, Fidelity Investments, and the Bank of New York Mellon, to offer crypto-enabled services.
“Soon BTC will be part of every 401k,” said Pentoshi, a pseudonymous cryptocurrency analyst after the CNBC’s report went viral.
Earlier, many analysts, including Bloomberg Intelligence’s senior commodity strategist, Mike McGlone, commented that Bitcoin’s ability to mousetrap a portion of Gold’s market cap could easily send its prices over $100,000. Meanwhile, gold bulls, including Euro Pacific Capital’s CEO Peter Schiff, dissented against the bullish call, reiterating his earlier stance that Bitcoin’s true value is zero.
Bitcoin Prices Rise
The Bitcoin reacted with a cautious optimism to the Goldman Sachs story.
After the New York opening bell, BTC/USD surged back above $55,000 as traders’ focus remained glued to the conclusion of the Federal Reserve’s two-day policy meeting. The US central bank chairman Jerome Powell will appear before the press at 1400 ET Wednesday to reveal how his office would tread ahead against the prospect of optimistic US economic forecasts.
Bitcoin came under pressure earlier on Wednesday after the yield on the US 10-year Treasury note surged to its 13-month high. Investors are betting that growth prospects in the US would have the Fed raise its benchmark rates earlier than planned. That reduced appetite for Bitcoin, which typically does well in an ultra-low rate environment.
The BTC/USD exchange rate surged to 55,610 as of 16:28 UTC.
Yashu Gola is a Mumbai-based finance journalist. He is profoundly active in the bitcoin space since 2014 – and has contributed to several cryptocurrency media outlets, including CoinChapter, NewsBTC, FxDailyReport, Bitcoinist, and CCN. Academically, Yashu holds a bachelor's in information technology, with majors in data structures and C++ programming language. He has also won the 'Atulya Award' for his efforts towards raising $100,000 for an India-based farming project.
No time to read? Crypto articles too technical? Only want the facts?