Morgan Stanley To Offer Bitcoin Swap Trading

News | September 14, 2018 By:

American investment bank Morgan Stanley is reportedly preparing to offer bitcoin swap trading for its clients.

Citing a source familiar with the matter, Bloomberg reported that the banking giant is looking to join other Wall Street firms in pursuing crypto exposure options. Morgan Stanley will reportedly “deal in contracts that give investors synthetic exposure to the performance of bitcoin.”

“Investors will be able to go long or short using the so-called price return swaps, and Morgan Stanley will charge a spread for each transaction,” the source said.

The source further said that Morgan Stanley is already technically prepared to offer the bitcoin swap trading, and will launch once there is proven institutional client demand and after the completion of an internal approval process.

“Morgan Stanley does not plan to trade bitcoin directly and its swaps are tied to bitcoin futures contracts,” the source said.

Earlier this year, Morgan Stanley CEO James Gorman said that they won’t let customers trade cryptocurrency directly through the bank, but would instead create a trading desk to support various derivatives tied to cryptocurrencies.

Morgan Stanley joins a growing number of Wall Street firms that are starting similar campaigns into crypto derivatives. Earlier this year, JPMorgan begun exploring ways to help its clients invest in cryptocurrency. Last week, Goldman Sachs said that it was working on a type of derivative for bitcoin called non-deliverable forwards due to client demand. Earlier this week, Citigroup reportedly created a “Digital Asset Receipt” (DAR), which will offer institutional investors a direct way of making crypto investments without the need to own them.