Morgan Stanley Reports Bitcoin/Cryptocurrencies as “New Institutional Investment Class”
Morgan Stanley, through its research division, have released a new 50 page report updating on the status of Bitcoin (BTC), Cryptocurrencies and Blockchain. According to The Block, the new report is an update to the first version published by the same firm titled ‘Bitcoin Decrypted: A Brief Teach-in and Implications’. The latter report was released back in December as the firm has continually researched cryptocurrencies and blockchain. The research division of Morgan Stanley has released a total of 15 such research reports thus far.
BTC Not A Store of Value, but an Institutional Asset Class
The new report went on to claim that Bitcoin is no longer a store of value but is in fact an institutional asset class set to take on trading and cater for the needs of big banks and family offices across the globe. This is in tandem with the notion that institutional clients are asking for Bitcoin and cryptocurrencies. Therefore, it is only natural to adhere to their demands by giving them what they want.
Morgan Stanley might not Sit On the Sidelines for Too Long
According to the Abacus Journal, there is a lot of money to be made by creating expensive structured products wrapped around the guise of crypto volatility. Morgan Stanley might not be interested in offering custody services but are inclined towards offering and/or utilizing the following:
- An institutional trading desk that handles futures contracts, OTC transactions, NDF like products that clients can trade across other Level 1 institutions such as Goldman Sachs and Citi
- Using Bakkt’s infrastructure to offer Bitcoin futures transactions and/or using every resource that exists by 2019. This includes collectively using Bakkt, ErisX, CME and CBOE
- Whether or not to go all in on a Bitcoin NDF as well as an Ethereum product that has yet to be given a trading classification (an NDF is a Non-Deliverable Forward that is cash-settled and is usually a short-term forward contract)
One is tempted to conclude that Morgan Stanley is pivoting itself in a position where the firm becomes a major player in the Bitcoin and Crypto trading industry. Evidence of this can be found in the fact that the firm has a research division that has produced 15 research papers to date that are centered on Bitcoin, Crypto and blockchain technology.
Do you think that Bitcoin has become an institutional asset class?