Morgan Stanley has seemingly been planning some sort of crypto initiative for longer than their clients can wait. According to sources at the global investment bank, clients (institutional and UHNW retail) have grown impatient with Morgan Stanley and ‘talk’ of crypto accessibility.
The sources discussed a small percentage of the client base keeps asking the firms bankers and brokers why they aren’t out in front in regards to crypto. Specifically, a straight line is being made by some as to Goldman Sach’s (it is well known in traditional finance that Morgan Stanley and Goldman Sachs are bitter rivals) consistent investments in the crypto ecosystem, BitGo and Circle, to name just a couple.
Those Goldman Sachs led investments position the firm to quickly scale up once the regulatory landscape is clear and defined. Morgan Stanley hasn’t made those any ‘in-kind’ investments that match Goldman’s and clients and brokers have been grumbling about it.
But there may be some hopes according to two sources that we spoke to at the bank. Morgan Stanley leadership is enamored with the path that Fidelity is taking and believe they can take the same path – and fashion it to be of interest to the firms largest institutional and UHNW clients.
“Are we behind? Yes. That really can’t be disputed at this point.” said our first source near the top of the communications org chart at Morgan Stanley. “But that won’t be the case once we commit to a particular strategy. We believe we are well positioned when the time is right.”
A second source closer to the broker ranks had this to say, “The word we hear is that leadership finds the Fidelity model for crypto appealing. And that could be the way it goes down here. Whatever strategy they choose, it needs to come quickly. We are getting asked about it daily. It does seem like clients that are aware of Bitcoin in particular see it as digital gold. That phrase has popped up often with UHNW clients.”
The digital gold narrative from uber-wealthy individuals and families is interesting. It means, if nothing else, that for those looking for Bitcoin information, the digital gold narrative is resonating.
“Clients that ask about crypto seem to be aware of Bakkt as well and question us as to our involvement and accessibility within their framework”, our second source described. “It is revealing what messaging seems to be making its way into these clients hands and sticking. Bakkt and digital gold seem to be moving in lock step – expect our firm (Morgan Stanley) to play along and once involved market it ($BTC) as such.”
Interesting conversations yesterday that reveal how traditional market players and dealing with the growth of Bitcoin and crypto at large. The bigger picture, that these firms have finally embraced, is that Bitcoin isn’t going away. And they are hell-bent on being there when mass investment follows an increase in awareness and adoption.