Bitcoin Gains Traction as Morgan Stanley Prepares Bitcoin Swap Trading

Sep 13, 2018

Bitcoin rallied on Thursday amid news that financial giant Morgan Stanley (NYSE:MS) is preparing a bitcoin derivatives scheme for clients.

Bitcoin rallied 3.44% to $6,479.00 on the Bitfinex exchange as of 8:04 AM ET (12:04 GMT).

The U.S. bank will deal crypto contracts, which allow investors to bet on the price of bitcoin without actually owning any, Bloomberg reported. Clients can go long or short and Morgan Stanley will charge a spread for the transactions.

It’s the latest Wall Street firm to find a way for clients to invest in the digital currency market. Citigroup (NYSE:C) is exploring digital asset receipts for trading virtual coins, while Goldman Sachs (NYSE:GS) is considering derivatives on bitcoin and a plan to offer custody for alternative coin assets.

Cryptocurrencies overall were higher, with the coin market cap of total market capitalization at $197 billion at the time of writing compared to $187 billion on Thursday.

Ethereum,or Ether, the second-biggest alternative currency by market cap, rose 13.08% to $196.42, after falling to a one-year low of $169.44 on Wednesday. XRP, the third-largest virtual currency, increased 5.75% to $0.27459 and Litecoin was at $53.764, up 11.10%.

In other news, the U.S. Financial Industry Regulatory Authority took its first disciplinary step involving cryptocurrencies, charging a broker with fraud and unlawful distribution of digital securities. On Tuesday the agency “filed a complaint against Timothy Tilton Ayre of Agawam, Massachusetts, charging him with securities fraud and the unlawful distribution of an unregistered cryptocurrency security called Hempcoin.”

The news comes after a New York federal rule judge that a fraud case involving virtual coins can go forward under U.S. securities laws.