Thomas Daniels
Two financial advisors on Wall Street are set to back direct Bitcoin Exchange-Traded Funds (ETFs) almost two months following their introduction on prominent American stock exchanges.
Clients holding brokerage accounts at Bank of America’s Merrill Lynch and Wells Fargo will be permitted to engage in transactions involving direct Bitcoin (BTC) ETFs, following a surge in demand amounting to billions, eight weeks post their market debut. According to Bloomberg, which obtained information from anonymous insiders familiar with the situation, this move marks a significant shift.
Issuers of direct Bitcoin ETFs comprise some of the United States’ largest asset management firms, including BlackRock and Fidelity. Nonetheless, initially, traditional banks and brokerage houses hesitated to make these products available to their clientele. Notably, Vanguard, Citi Bank, and UBS decided against supporting this Bitcoin-centric investment option upon its introduction, as reported by crypto.news.
Despite this, issuers of direct Bitcoin ETFs have successfully accumulated over $20 billion in assets under management (AUM), a growth fueled by the rising value of Bitcoin. The cryptocurrency has seen an impressive increase of nearly 50% this year, attracting investments from a broad spectrum of investors, from retail to hedge funds, thanks to the allure of the ETF structure.
The trend of traditional finance (tradfi) stakeholders engaging with direct Bitcoin ETFs is expanding, with Citigroup and UBS opening up access to selected clients for these ETFs on their platforms since January. Merrill Lynch and Wells Fargo are now poised to provide Bitcoin investment opportunities to those expressing interest.
Moreover, there’s speculation that another major player, Morgan Stanley, is considering offering its clients the ability to trade in direct BTC ETFs. Matt Hougan, the Chief Investment Officer at Bitwise, shared with CNBC his anticipation that more traditional finance behemoths will likely join the fray, channeling billions of dormant investment dollars into Bitcoin through ETFs.
