Morgan Stanley Reports Substantial BTC ETF and MicroStrategy Stakes in SEC Filing

A Morgan Stanley fund has invested 2.1% in BlackRock’s iShares Bitcoin Trust and 4% in MicroStrategy, offering considerable Bitcoin exposure.
The fund’s total assets amount to approximately US$10 million, with its Bitcoin-related investments totalling about US$613,000.
MicroStrategy holds 226,500 Bitcoins, making it a significant indirect Bitcoin investment vehicle for the fund.
Despite these investments being relatively small compared to Morgan Stanley’s overall AUM, they highlight the firm’s growing focus on crypto.

According to a recent filing with the US Securities and Exchange Commission (SEC), asset manager Morgan Stanley is venturing deeper into the crypto sector.

According to the filing, the fund called Morgan Stanley Institutional Fund, holds 2.1% in BlackRock’s iShares Bitcoin Trust (IBIT). The fund also has another crypto-heavyweight in its top ten: Michael Saylor’s MicroStrategy with a 4% investment.

Related: Monochrome Asset Management to Launch Ethereum ETF on Cboe Australia

The fund has a reported US$10,042,729 (AU$14,896,142) in net assets which means the IBIT holdings account for roughly US$211,000 (AU$313,036) while the MicroStrategy allocation makes up approximately US$402,000 (AU$596,469).

As per BiTBO, Saylor’s firm currently holds 226,500 Bitcoin, making it an excellent vehicle for BTC exposure without directly holding the asset.

Another notable holding of the fund is in Tesla, which accounts for 6.1%. While Tesla is not considered a digital asset company per se, it still holds just under 10,000 BTC.

Morgan Stanley Institutional Fund, top ten holdings, source: SEC.gov

Considering that Morgan Stanley has assets under management (AUM) in the trillions, these numbers are relatively small. Nonetheless, it’s still a significant development, especially in the light of the fact that five of the six largest asset managers globally now have exposure to Bitcoin in some way.

Just in August, a mere month ago, the company officially allowed its 15,000 advisors to recommend crypto to their clients. However, for now, they’re limited to Bitcoin funds only and can recommend BlackRock’s IBIT and Fidelity’s Wise Origin Bitcoin Fund (FBTC).

And it can’t be any odd client either, as the net worth of clients must be at least US$1.5 million (AU$2.22 million).

Related: Glassnode Analysis: Long-Term BTC Holders Stable, Short-Term Investors Brace for Volatility

Meanwhile, with Bitcoin struggling to keep above US$56K (AU$83.14K), the Spot funds are continuing to see net outflows. Six out of the past seven trading days have had net outflows, with a total of US$910.61 million (AU$1.35 billion) leaving the funds combined.

While not necessarily new or concerning, because the funds have experienced streaks of net outflows before, overall the volume of flows into the funds is slowing.

Data from Coinglass shows that while days of outflows are often followed by several days of inflows, overall the number of inflows, in dollar terms, is slowing.