One of Morgan Stanley’s new bitcoin-only private funds raised $29.4 million from 322 investors in its first 14 days, according to regulatory documents published Thursday.
Managed by FS Investments with NYDIG custodying the bitcoin, the fund is one of two new bitcoin investment vehicles offered by newly-bullish Morgan Stanley. When news of the institutional stalwart’s bitcoin offering broke last month, it kicked Wall Street’s crypto musings into high gear.
The early returns for “FS NYDIG Select Bitcoin Fund LP” indicate investors are indeed hungry for accessing bitcoin products through their institutional managers. Passive funds like Morgan Stanley’s fare give clients unwilling to custody their own keys an easy way into the asset class.
In just 14 days, Morgan Stanley’s FS/NYDIG fund has become one of the most popular private bitcoin vehicles, beating out far-older industry offerings from Pantera and Galaxy by investor count, according to fund data compiled by CoinDesk. (Galaxy is also accepting bitcoin investments from Morgan Stanley in a pre-existing fund.)
Seeking exposure to bitcoin via fund is not without its drawbacks. Morgan Stanley limits clients’ bitcoin bets to 2.5% percent of their total net worth. They must have at least $2 million in net worth. And they must pay an upfront placement fee of 3% for bitcoin investments under $250,000, according to offering documents obtained by CoinDesk.
The average investment in Morgan Stanley’s new bitcoin fund was around $91,000. Morgan Stanley will receive placement fees, according to the regulatory documents.
Morgan Stanley declined to comment. NYDIG and FS Investments did not immediately respond to CoinDesk.