Modern Consensus is coining a new phrase: ETF Slop.™ And Morgan Stanley is the latest to add its thumb to the scale.
This morning, the giant bank announced the launch of Morgan Stanley Bitcoin Trust, an exchange-traded product that seeks to track bitcoin performance. It’s doing so through its subsidiary Morgan Stanley Investment Management, the first U.S. bank-affiliated asset manager that offers cryptocurrency what they’re calling ETP for exchange-traded product.
While there’s hardly a shortage of instruments to track bitcoin, this kind of endorsement from the bluest of blue chip banks only adds to the sense that bitcoin has matured into an asset for grown-ups.
“ETPs remain a powerful way for investors to gain exposure to new asset classes within a transparent and regulated framework,” according to Ally Wallace, Global Head of ETF Strategy at Morgan Stanley Investment Management. “With MSBT, we’re extending our product offering to meet growing client interest in digital assets. This builds on our track record of launching compelling investment strategies in the ETF wrapper to help investors meet their investment objectives.”
This certainly represents an evolution of the banking giant’s attitude toward crypto. In 2021, Ruchir Sharma, who was then Morgan Stanley’s Head of Emerging Markets and Chief Global Strategist and is now a fund manager and columnist for the Financial Times, wrote one of those “what is crypto” letters that have aged so badly. “Crypto,” he wrote, “means hidden or secret, and often describes a target of popular suspicion and fear, as in crypto-fascist or cryptocommunist. But now, despite the jitters natural in a global pandemic, cryptocurrencies are rapidly gaining popular support as alternatives to gold (a store of value) and the dollar (as a means of payment).”
Now that MS is fully on board, Coinbase (COIN) and Bank of New York Mellon (BK) are set to provide digital asset custody services for the ETP.
Amy Oldenburg, Head of Digital Asset Strategy at Morgan Stanley, weighed in as well. “Digital assets are increasingly intersecting with traditional markets, and our focus is on helping clients access that evolution through structures they understand and trust. MSBT reflects our firmwide approach to thoughtfully building digital asset capabilities grounded in traditional governance and market infrastructure that seeks to meet long-term client needs. We believe that our ability to simplify how investors access their complete portfolio across asset classes and investment types will resonate with our clients and investors across the globe.”
