November 27, 2022

Morgan Stanley acquires a large number of Grayscale Bitcoin Trust shares

The world's third largest wealth manager, Morgan Stanley, has dramatically increased its Bitcoin position.

According to the documents of the Securities Commission andUS Exchanges (SEC), Morgan Stanley has increased the amount of bitcoins through the Grayscale Bitcoin Trust, which gives hope for the possible approval of the Grayscale Bitcoin ETF.

Significant number of Grayscale Bitcoin sharesTrust (GBTC) were acquired with the participation of several investment funds. Growth Portfolio added 1.5 million shares of GBTC, while Insight and Global Opportunity Portfolio added nearly 600,000 and 500,000 shares, according to filings.

Within these three funds, Morgan Stanley incurrently owns over 6.6 million GBTC shares worth over $ 300 million. This marks an increase in GBTC of approximately $ 118 million from June 30 to September 30.

In addition to this, Morgan Stanley ownsa significant number of shares in Microstrategy, the largest corporate holder of bitcoins. The asset manager decided to invest $ 500 million in Microstrategy shares back in January, thus having an indirect impact on Bitcoin.

Grayscale Bitcoin Trust Traded OTCmarket, allows institutional investors to gain indirect access to bitcoin by purchasing shares of the fund. However, since February of this year, GBTC has been trading at a discount to the fund's net asset value. The discount to BTC is currently around 11.56%, likely due to the 12-month blocking period and high management fees for Grayscale.

Morgan Stanley acquires a large number of Grayscale Bitcoin Trust shares

Competition for crypto investment productsthe institutional level is enhanced. The Valkyrie and VanEck Bitcoin futures ETFs were approved by the SEC in October and November and began trading on the Nasdaq and CBOE.

The Grayscale team also announced plansconvert your trust into a spot ETF, but so far the SEC has repeatedly spoken about the inappropriateness of this product. In November, the US securities regulator rejected VanEck's application for a spot Bitcoin ETF, saying the proposed product did not comply with measures to prevent "fraudulent and manipulative actions and practices" and "protect investors and the public interest."