Morgan Stanley may bet on Bitcoin
Investment banking firm Morgan Stanley may become the latest financial institution to bet on Bitcoin in the continuing rally.
Bloomberg reported that Morgan Stanley's investment arm, MSIM, is considering adding Bitcoin to the list of potential bets.
Counterpoint Global, valued at $ 150 billion, is exploring whether cryptocurrency will be a suitable choice for its investors.
Getting ahead with investments requires approval by the company and regulators, and Morgan Stanley's assertion would put the weight of its name behind the volatile asset class that is still struggling to win acceptance in most of the traditional financial industry.
The currency's quadruple jump in currency in four months sparked customer interest, making digital assets even more difficult to ignore.
After attracting the attention of hedge fund owners, newly cryptocurrencies have made progress with more major companies, such as MasterCard and BNY Mellon.
The review may ultimately lead to Morgan Stanley choosing to move away from Bitcoin, and previous highs in cryptocurrency also attracted waves of interest on Wall Street but they quickly faded.
Much of the industry's uncertainty centers on Bitcoin's unpredictable price fluctuations and the shortage of things it can buy for more than a decade since its inception.
Billions of dollars have been poured into cryptocurrency, including the Grayscale Bitcoin Trust, which is a digital currency investment product that individual investors can buy and sell in brokerage accounts.
Institutional investors, who are prohibited by their money rules from holding Bitcoin directly, have also moved into such funds.
For Wall Street firms, the inability to offer Bitcoins to these clients increases the risk of losing them to other managers.
This could spark new discussions in the industry about openness to crypto-digital assets.
Counterpoint Global has expanded by betting on unique companies that could significantly increase their market value, and enthusiasts argue that this approach fits perfectly with Bitcoin.
Morgan Stanley's investment arm oversees nearly 19 funds, five of which have gained more than 100 percent in 2020.
Its mutual funds have consistently ranked first in the rating in recent years.
Last year's extraordinarily high returns were supported by bets on companies benefiting from the pandemic, such as e-commerce and streaming entertainment.
Notable investments included Amazon, Shopify, Slack, Zoom, and Moderna.
Despite the size of Morgan Stanley's investment arm, it relies on heavy investments and has stakes in only about 200 companies.