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BTC · 2d

Morgan Stanley Adds More Grayscale Bitcoin Shares Despite Heavy Discount

Morgan Stanley, one of the largest investment banks in the U.S., has increased its Bitcoin exposure to over $300 million by purchasing additional shares of the Grayscale Bitcoin Trust (GBTC) for three of its funds during the third quarter.

In an SEC filing this week, the Morgan Stanley Institutional Fund’s Growth Portfolio reported holding 3,642,118 shares of GBTC at the end of Q3, compared to 2,130,153 at the end of Q2, an increase of 71%.

The Grayscale Bitcoin Trust is a financial vehicle that enables investors to trade shares in trusts holding large pools of Bitcoin. This way, investors get exposure to the world’s largest cryptocurrency without the need to purchase and hold the actual underlying asset.

In new SEC filings, Morgan Stanley has disclosed a dramatic increase in Bitcoin exposure in its asset management business. Earlier this year, Morgan reported buying Grayscale BTC in a large number of investment funds. For the three funds with the largest Grayscale holdings... — MacroScope (@MacroScope17) November 24, 2021

The firm’s next-largest purchase of GBTC shares in Q3 was made through the Morgan Stanley Insight Fund (CPODX), growing its holdings by 63% to 1,520,549 GBTC shares at the end of Q3, according to a separate document. The fund had 928,051 shares of GBTC in the previous quarter.

In the same period, the Morgan Stanley Global Opportunity Portfolio increased its GBTC holdings from 919,805 to 1,463,714 shares, an increase of 59% in Q3.

The total amount of GBTC shares held across the three funds has thus reached 6,626,381, worth roughly $307 million in current prices.

The price of GBTC is $46.42 at the time of writing.

GBTC’s continued discount

Managed by New York-based Grayscale Investments, GBTC, has been trading at a significant discount since February, meaning that the price of the shares is lower than the current value of the Bitcoin they represent.

According to data from YCharts, t...

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