The retail wealth management industry is set to offer bitcoin to their clients, similar to Morgan Stanley’s bitcoin offering to their wealthy clients
JMP Securities is expecting a huge flow worth $1.5trillion of incremental capital to go into bitcoin. This amount is much larger than bitcoin’s current market cap.
The claim follows Morgan Stanley’s stance on offering bitcoin to their clients, with a number of other wealth management companies set to follow their example.
According to JMP Securities, Morgan Stanley’s move in offering bitcoin to their clients could trigger a massive influx of investment in bitcoin, resulting in this mammoth $1.5trillion flow.
The managing director and equity research analyst at JMP Securities, Devin Ryan, reinforces these claims about Morgan Stanley stating that the leader in financial services is acting as the leader for other banks.
Ryan further added that:
“Around $30 trillion of assets in the U.S. retail wealth management industry currently do not have direct access to bitcoin.
Making some assumptions, with relatively modest asset allocation exposure of 5% of a portfolio, this alone would represent $1.5 trillion of incremental capital into bitcoin, which is greater than its current market cap.”
Devin Ryan’s statement about the 5% investment into bitcoin is not a particular amount. Jim Cramer, Kevin O’Leary and Jack Dorsey all agree on the 5% figure. Cramer and O’Leary believe that the 5% allocation is optimal while Dorsey’s Square Inc. actually holds 5% of its total cash reserves in bitcoin.
Last week, Morgan Stanley became the first ever US bank to allow clients access to bitcoin funds. The investment bank launched an internal memo indicating that three funds will allow bitcoin ownership but only to their wealthiest clients – who have a minimum of $2million in assets.
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