• Morgan Stanley opens access to spot Bitcoin ETF trading for wealthy clients.

• This move signals growing institutional interest in Bitcoin and crypto investment.

• Despite recent outflows, Bitcoin ETFs remain a focal point for investors.

Morgan Stanley, a leading investment bank, has taken a significant step in acknowledging the growing demand for spot Bitcoin exchange-traded funds (ETFs). According to a CNBC report on August 2, 2024, the Wall Street giant has instructed its financial advisors to offer Bitcoin ETFs to eligible clients, signaling increased acceptance of crypto within mainstream finance.

Morgan Stanley is reportedly allowing its over 15,000 advisors to invite qualified clients to purchase shares in two spot Bitcoin ETFs—BlackRock’s iShares Bitcoin Trust (IBTC) and Fidelity’s Wise Origin Bitcoin Trust (FBTC). This strategic move, set to initiate on Wednesday, signifies a major shift in the institutional crypto investment landscape.

The launch of spot Bitcoin ETFs in January has spurred a surge in interest and adoption of Bitcoin ETF trading. This success, coupled with the recent launch of spot Ether ETFs, has fueled speculation about the expansion of the crypto ETF market, potentially including ETFs for other cryptocurrencies like Solana and XRP.

Sources familiar with the matter suggest that Morgan Stanley’s decision stems from increased client demand for Bitcoin ETF trading. While details of the policy remain undisclosed, it’s reported that only clients with a net worth of at least $1.5 million will be eligible, and investments will be limited to taxable brokerage accounts, excluding retirement accounts.Despite an initial inflow of around $50 million into Bitcoin ETFs on August 1, the funds experienced a significant outflow of $237.4 million on August 2, marking the highest single-day outflow in a month. Fidelity’s FBTC led the Bitcoin ETF outflows with $104.1 million, followed by Grayscale’s Bitcoin Trust (GBTC) with $45.9 million.

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