Morgan Stanley's $150BN Investment Arm May Soon Buy Bitcoin

One month ago, when few people believed that it was only a matter of weeks before institutions flooded into bitcoin (BITCOMP) as Tesla (TSLA) unleashed a feverish adoption of the cryptocurrency, we predicted that not only would Elon Musk buy billions in bitcoin (as Tesla confirmed last week) and thus spark a cascade of institutional copycats (including financial giants as Mastercard (MA) and BNY (BK) this week), but that it would be none other than Morgan Stanley (MS) that would hint as to what is coming.

We said that while many institutions want to obtain bitcoin without having exposure to the Grayscale Bitcoin Trust (GBTC), which trades at a sizable premium to fair value, one option is to do what Morgan Stanley's investment management arm did: not buy GBTC, but invest directly into the bitcoin proxy that is MicroStrategy (MSTR).

Clearly happy with the company's "pro-bitcoin" strategy, Morgan Stanley boosted its stake by a whopping 455% in the fourth quarter, from 142.9 thousand shares to a record 792.6 thousand shares, representing more than 10% of MSTR's total outstanding shares.

We rhetorically asked "what can explain Morgan Stanley's enthusiasm for MicroStrategy, which has emerged as the best publicly-traded proxy for the world's best performing asset?" Which we answered with "as Coindesk notes, 'Morgan Stanley views its investment as a way to benefit from bitcoin's historic run without actually being a HODLer.'"

We concluded that "in short, Morgan Stanley's aggressive expansion of its MicroStrategy holdings may be the catalyst that unlocks Bitcoin's door to rapidly crossing the psychological $100,000 level next."

We were correct, because not only did Tesla's purchase send bitcoin above $49,000, but it is the purchases by copycat investors that will soon push it to $100,000, and eventually even higher. And while we wait to see how many more companies will convert cash to bitcoin in the footsteps of MSTR and Apple (AAPL), it appears that Morgan Stanley is about to make waves in cryptocurrency again.

1 2 3 4
View single page >> |

Disclosure: Copyright ©2009-2021 Media, LTD; All Rights Reserved. Zero Hedge is intended for Mature Audiences. Familiarize yourself with our legal and use policies every ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.
William K. 2 weeks ago Member's comment

Could this possibly be a "pump and dump" scam of epic proportions?