Morgan Stanley and UBS are actively competing to become the first major banks to offer their customers access to Bitcoin exchange-traded funds (ETFs), according to people familiar with the matter.
Sources said Morgan Stanley wants to be the first major bank to offer its clients full access to spot BTC ETFs and will try to put UBS at the forefront through an announcement a few days earlier.
Andrew Parish, co-founder of Arch Public, shared the development on social media citing sources. He also revealed that UBS plans to announce the ETF offering during the week of April 8th.
The launch of Bitcoin ETFs has already been partially implemented in UBS's Private Wealth Management (PWM) division, where they were technically available “unsolicited” to individuals with assets exceeding $10 million.
Discussions now revolve around full approval of all institutional platforms, which would allow financial advisors to actively include Bitcoin ETFs in client portfolios.
TradFi on the go
This competition highlights the increasing acceptance of cryptocurrencies in the mainstream financial market and signals a significant shift towards integrating digital assets into traditional investment portfolios.
Demand for spot Bitcoin ETFs helped Bitcoin hit a new all-time high on March 14. The ETFs have achieved remarkable success in the US market, quickly attracting over $12 billion in inflows and generating over $150 billion in trading volume by early April.
Although ETF activity has slowed recently, the expected entry of Morgan Stanley and UBS into this market could revive interest and activity.
Meanwhile, industry insiders previously revealed that major financial institutions have conducted due diligence and are expected to begin offering exposure to Bitcoin ETFs to their clients from the second quarter.
“Compliance game of chicken”
Meanwhile, Eric Balchunas, a senior ETF analyst at Bloomberg Intelligence, said sources had told him that most banks had not added Bitcoin ETFs to their offerings and were in a “holding pattern.”
He described the situation as a “compliance game of chicken,” with each bank waiting for the other to act first. This would provide the necessary regulatory and operational protections for others to follow suit.
Despite the general caution, UBS has taken the first steps and allowed its private wealth management clients access to these ETFs with certain restrictions. The move suggests a phased approach toward a broader offering that also includes advisory services for including these ETFs in client portfolios.
As the financial industry prepares for this potential shift, the timing and impact of Morgan Stanley and UBS's initiatives in the spot BTC ETF market remain highly anticipated. Their entry could redefine investment strategies and further integrate digital assets into the economic mainstream.
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