Morgan Stanley revealed in an SEC filing on March 31 that 12 of its existing institutional funds could use cash-settled futures and investments with the Grayscale Bitcoin Trust to gain exposure to Bitcoin.
Following earlier reports that Morgan Stanley planned to provide its clients with access to funds that would allow them to own Bitcoin, the investment banking firm has now decided to allow Bitcoin exposure in several institutional funds.
Morgan Stanley also went over which funds might be interested in taking on this new Bitcoin exposure, as well as how the investments will be made. "Bitcoin and bitcoin futures have generally exhibited significant price volatility relative to traditional asset classes," Morgan Stanley writes in its filing.
According to the filing which was published by SEC on 31 March 2021, the company wrote:
"Certain Funds may have exposure to bitcoin indirectly through cash-settled futures or indirectly through investments in Grayscale Bitcoin Trust (BTC) ("GBTC"), a privately offered investment vehicle that invests in bitcoin. To the extent a Fund invests in bitcoin futures or GBTC, it will do so through a wholly-owned subsidiary, which is organized as an exempted company under the laws of the Cayman Islands (each, a "Subsidiary"). A Fund may at times have no exposure to Bitcoin".
The portfolios that could gain exposure to BTC are:
- Advantage Portfolio
- Asia Opportunity Portfolio
- Counterpoint Global Portfolio
- Developing Opportunity Portfolio
- Global Advantage Portfolio
- Global Permanence Portfolio
- Global Opportunity Portfolio
- Growth Portfolio
- Inception Portfolio
- International Advantage Portfolio
- International Opportunity Portfolio
- Permanence Portfolio (each, a "Portfolio")
Because of their "aggressive risk tolerance," the investment banking firm decided to limit access to Bitcoin to only wealthy clients. To qualify, these clients must have at least $2 million in assets held by the firm, while investment firms must have at least $5 million.