Morgan Stanley Wealth Management today announced a new referral arrangement with Galaxy Digital (“Galaxy”) through which eligible clients can lend cryptocurrency to Galaxy and receive shares of exchange‑traded products (“ETPs”) with exposure to spot crypto, including, but not limited to, the Morgan Stanley Bitcoin Trust (MSBT), offered by Morgan Stanley Investment Management.
This model is designed for clients that want to lend crypto assets for repayment in traditional investment products in an efficient manner, enabling portfolio integration, including margin and lending capabilities, while reducing onboarding times and costs.
“Morgan Stanley has been investing in the DeFi space for some time, and we are proud to support a referral capability with Galaxy to provide Wealth Management clients with an institutionalized pathway that helps integrate digital assets into their portfolio,” said Alison Nest, Head of Investment Solutions Products, Morgan Stanley Wealth Management. “This referral arrangement represents a significant step forward in bridging traditional finance and decentralized finance, providing more investors with streamlined opportunities to diversify.”
How it works
Morgan Stanley Wealth Management is providing clients with educational resources about digital assets and facilitating referrals to Galaxy.
Under Galaxy’s model, a client lends specified digital assets (e.g., Bitcoin, Ether, Solana) to Galaxy. Once Galaxy determines it can settle such loan in ETP shares, Galaxy will coordinate an in‑kind creation with an Authorized Participant, and ETP shares will be delivered into the client’s account of their choosing.
Today, onboarding timelines for these transactions can exceed four weeks. Through the development of this referral capability, onboarding times may be reduced by as much as 75% in some cases.
In addition, Galaxy will reduce its lending transaction minimum for Morgan Stanley‑referred clients from $25 million to $5 million, expanding access to qualified clients who meet eligibility requirements.
“We are excited to support referrals from Morgan Stanley Wealth Management to offer an efficient and secure path to access spot crypto ETPs,” said Zane Glauber, Global Head of Distribution at Galaxy. “Streamlined onboarding and lowered transaction minimums make it easier for clients to integrate digital assets alongside traditional investments, supporting a holistic approach to wealth management.”
About Morgan Stanley Wealth Management
Morgan Stanley Wealth Management, a global leader, provides access to a wide range of products and services to individuals, businesses and institutions, including brokerage and investment advisory services, financial and wealth planning, cash management and lending products, annuities and insurance, retirement and trust services.
About Morgan Stanley
Morgan Stanley (NYSE MS) is a leading global financial services firm providing investment banking, securities, wealth management and investment management services. With offices in more than 41 countries, the Firm’s employees serve clients worldwide including corporations, governments, institutions and individuals. For more information, visit www.morganstanley.com.
About Galaxy
Galaxy Digital Inc. (Nasdaq: GLXY) is a global leader in digital assets and data center infrastructure, delivering solutions that accelerate progress in finance and artificial intelligence. Our digital assets platform offers institutional access to trading, advisory, asset management, staking, self-custody, and tokenization technology. In addition, we develop and operate cutting-edge data center infrastructure to power AI and HPC workloads. Our 1.6 GW Helios campus in Texas positions Galaxy among the largest and fastest-growing data center developers in North America. The Company is headquartered in New York City, with offices across North America, Europe, the Middle East, and Asia. Additional information about Galaxy’s businesses and products is available on www.galaxy.com.
Morgan Stanley Bitcoin Trust (“MSBT” or the “Trust”), an exchange traded product, is not registered under the Investment Company Act of 1940, as amended (the “40 Act”) and therefore is not subject to the same regulations and protections as 40 Act-registered ETFs and mutual funds. An investment in MSBT is subject to a high degree of risk and heightened volatility. MSBT is not suitable for an investor that cannot afford the loss of the entire investment. An investment in the Trust is not a direct investment in bitcoin.
Definitions:
In-Kind Exchanges or transfers allow investors to move investments or assets between accounts or vehicles without selling them or converting them to cash.
Spot Crypto are exchange-based products that track the price of an asset, i.e. bitcoin, by holding the actual asset as the underlying asset.
Eligible clients: All clients should consult their financial advisor to see if they meet the investment criteria.
Margin refers to the ability to use eligible securities as collateral for other activities within a portfolio.
An Authorized Participant is an organization that has the right to create and redeem shares of an ETP. The primary purpose is to ensure liquidity and ETP price alignment with net asset values (NAV).
Disclosures:
On an unsolicited basis, Morgan Stanley will refer clients to Galaxy for onboarding and execution. Galaxy makes account decisions; Morgan Stanley does not control, supervise, or participate in Galaxy’s onboarding or its provision of any services, and Morgan Stanley does not provide a recommendation or endorsement to clients regarding Galaxy or spot crypto to ETP exchanges. Galaxy and Morgan Stanley are not affiliated. Clients are responsible for their own due diligence and should consult their own tax and legal advisors.
Morgan Stanley Wealth Management will not receive compensation in connection with the referral or the transaction executed at Galaxy. Fees disclosed by Galaxy are currently indicated as 15–25 bps, subject to transaction specifics.
Spot cryptocurrency ETPs are not registered investment companies under the Investment Company Act of 1940, and therefore are not subject to the same regulatory requirements as mutual funds or traditional exchange traded funds. Shareholders do not have the same regulatory protections associated with registered investment companies.
Trading and owning digital assets involves significant risk, including the risk of complete loss. This solution is not available for clients in all jurisdictions.
Margin borrowing increases risk and may result in losses greater than the amount invested; you may be required to deposit additional funds or securities on short notice, and Morgan Stanley may liquidate securities in your account to meet a margin call. Lending products are subject to credit approval and other terms and conditions.
Morgan Stanley Bitcoin Trust Disclosure
Investing in digital assets involves risk, including possible loss of principal. An investment in Morgan Stanley Bitcoin Trust (“MSBT” or the “Trust”) is subject to a high degree of risk and heightened volatility. MSBT is not suitable for any investor that cannot afford loss of the entire investment.
Morgan Stanley Investment Management Inc is the Delegated Sponsor and Foreside Fund Services, LLC is the Marketing Agent for MSBT. Foreside Fund Services, LLC, is not affiliated with Morgan Stanley Wealth Management or Galaxy Digital.
This information must be preceded or accompanied by a prospectus, click here to view or download prospectus. We advise you to consider the Trust’s objectives, risks, charges and expenses carefully before investing. The prospectus contains this and other important information about the Trust. Please read the prospectus carefully before you invest.
The Trust is not registered under the Investment Company Act of 1940, as amended (the “40 Act”) and is not subject to regulation under the 40 Act, unlike most mutual funds or ETFs. The Trust may trade at a premium or discount to its net asset value. The Trust is new and has a limited operating history upon which investors may base an evaluation of its likely performance.
The value of the Trust relates directly to the value of the underlying digital asset it holds, the value of which is highly volatile and subject to fluctuations due to a number of factors.
The Trust relies on third party service providers to perform certain functions essential to the affairs of the Trust. Some of these service providers may not be subject to federal regulation and oversight and the replacement of such service providers could pose a challenge to the safekeeping of the digital asset and to the operations of the Trust.
No guarantee or representation is made that the Trust’s investment strategy, including, without limitation, its investment objectives or strategies, will be successful, and investment results may vary substantially over time. Nothing herein is intended to imply that the Trust’s investment methodology or that investing may be considered “conservative,” “safe,” “risk free,” or “risk averse.”
This material is not an offer or solicitation of any kind to buy or sell any securities outside of the United States of America. Nothing in this content should be considered a solicitation to buy or an offer to sell shares of any investment in any jurisdiction where the offer or solicitation would be unlawful under the securities laws of such jurisdiction, nor is it intended as investment, tax, financial, or legal advice. Investors should seek such professional advice for their particular situation and jurisdiction.
Digital Asset Risk Disclosures
Many digital assets, including bitcoin, have experienced significant volatility in trading prices in recent periods and may continue to experience such volatility in the future. Such volatility in digital asset prices could have a material adverse effect on the value of the Trust and the shares could lose all or substantially all of their value.
Digital assets represent a new and rapidly evolving industry. The value of the Trust depends, among other things, on the acceptance of the digital assets in general and bitcoin in particular, the capabilities and development of blockchain technologies and the fundamental investment characteristics of bitcoin.
Digital asset networks are developed and maintained by a diverse set of contributors and the perception that certain contributors will no longer contribute to the network or may decrease their contributions to, or involvement with the network could have an adverse effect on the market price of the related digital asset.
Digital assets may have concentrated ownership and large sales or distributions by holders of such digital assets could have an adverse effect on the market price of such digital assets.
The Trust holds bitcoin; however, an investment in the Trust is not a direct investment in bitcoin. As a non-diversified and single industry fund, the value of the shares may fluctuate more than shares invested in a broader range of industries. Because the value of the Trust is correlated with the value of bitcoin, it is important to understand the investment attributes of, and the market for, the underlying digital asset (bitcoin). Please consult with your financial professional.
A substantial direct investment in digital assets may require expensive and sometimes complicated arrangements in connection with the acquisition, security and safekeeping of the digital asset and may involve the payment of substantial fees to third party service providers through cash payments of U.S. dollars.
Regulation of digital assets, including bitcoin, continues to evolve across different jurisdictions worldwide, which may cause uncertainty and insecurity as to the legal and tax status of a given digital asset. As bitcoin and digital assets have grown in both popularity and market size, the U.S. Congress and a number of U.S. federal and state agencies have been examining the operations of digital asset networks, digital asset users and the digital asset spot market. Many of these state and federal agencies have brought enforcement actions and issued advisories and rules relating to digital asset markets. Ongoing and future regulatory actions with respect to digital assets generally or any single digital asset in particular may alter, perhaps to a materially adverse extent, the nature of an investment in the Trust.
The Delegated Sponsor does not store, hold, or maintain custody or control of the Trust’s digital assets but instead has entered into Custodial Services Agreements with third parties to facilitate the security of its bitcoin. The Custodians control and secure the Trust’s bitcoin, in segregated custody accounts to store private keys, which allows for the transfer of ownership or control of the Trust’s bitcoin, on the Trust’s behalf. If a Custodian resigns or is removed by the Delegated Sponsor or otherwise, without replacement, it could trigger early termination of the Trust.
The net assets of the Trust and its shares are valued on a daily basis with reference to CoinDesk Bitcoin Benchmark Rate, a standardized reference rate published by COINDESK®. COINDESK® and the Trust’s applicable reference rate (the “Index”) are trade or service marks of CoinDesk Indices, Inc. (with its affiliates, including CC Data Limited, “CDI”), and/or its licensors. CDI or CDI’s licensors own all proprietary rights in the Index. CDI is not affiliated with Morgan Stanley Investment Management Inc. and does not approve, endorse, review, or recommend the Trust. CDI does not guarantee the timeliness, accurateness, or completeness of any data or information relating to any Index and shall not be liable in any way to Morgan Stanley Investment Management Inc., investors in or holders of any of the Trust or other third parties in respect of the use or accuracy of any Index or any data included therein.
Diversification does not ensure a profit or protect against loss.
Before making an investment decision, you should carefully consider the risk factors and other information included in the prospectus.
Investors should be aware that investing in MSBT is not equivalent to investing directly in bitcoin.
Forward-Looking Statements
Certain statements contained herein and in any related materials may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can generally be identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” or similar expressions, or the negative of such terms. These statements are based on current expectations, estimates, assumptions, and projections and are subject to significant risks, uncertainties, and other factors that may cause actual results, performance, or developments to differ materially from those expressed or implied by such statements. Forward-looking statements speak only as of the date on which they are made. The Trust undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the extent required by applicable law.
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