March 1, 2024

Wells Fargo and Merrill Lynch to Offer Bitcoin ETFs

Recognizing the growing demand for cryptocurrency investments, major financial institutions like Wells Fargo and Merrill Lynch are now providing access to bitcoin ETFs for their wealth management clients.

In a notable development indicative of the shifting financial landscape, Wells Fargo and Bank of America's Merrill Lynch have entered the realm of cryptocurrency investments by offering bitcoin exchange-traded funds (ETFs) to select clients within their wealth management divisions.

According to Bloomberg, which broke the news citing anonymous sources, Wells Fargo spokesperson confirmed the availability of spot bitcoin ETFs for unsolicited purchases through advisors or their online WellsTrade platform.

Bank of America's Merrill Lynch, however, has not yet provided any official comment on this development.

The decision follows the footsteps of other brokerage giants like Fidelity and Charles Schwab, which started granting access to bitcoin ETFs upon their launch on January 11.

Contrary to this trend, Vanguard has taken a cautious stance on cryptocurrencies, branding the investment case for them as "weak". Consequently, users of its brokerage platform were barred from trading these funds.

Ric Edelman, founder of Edelman Financial Services, anticipates widespread availability of bitcoin ETFs across registered investment advisers (RIAs) and brokerage firms in the future. Nevertheless, he predicts a slower adoption rate among wirehouses such as Morgan Stanley, Merrill Lynch, and Wells Fargo, attributing it to their bureaucratic structures.

While there were reports of Morgan Stanley exploring the possibility of offering bitcoin ETFs to certain clients, Wells Fargo's wealth management arm, Wells Fargo Advisors, had already begun catering to customers seeking bitcoin ETFs as early as January, as reported by Investment News.

The surge in bitcoin ETF activity this week, marked by record trade volumes and net inflows, underscores the undeniable investor demand for these products. Edelman emphasized that this demand, coupled with the rapid appreciation of bitcoin's value, is compelling financial firms to expedite their involvement in cryptocurrency markets.

Edelman observed that there's mounting pressure on financial firms from both their representatives and clients to delve into cryptocurrency investments. He emphasized that delaying the allocation of these assets by these firms could lead to dissatisfaction among both parties, ultimately compromising everyone's interests.

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