BofA, Wells, Offering Spot Bitcoin ETFs to Brokerage Clients

Traditional financial services firms increasingly embrace the new products while Vanguard holds out.

ETF.com
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Contributing Editor
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Reviewed by: etf.com Staff
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Edited by: Ron Day

Financial services powerhouses Wells Fargo & Co. and Bank of America Inc.’s Merrill Lynch are offering spot bitcoin ETFs to their brokerage platforms, another sign of Wall Street’s growing embrace of the new products. 

The ETFs based directly on bitcoin’s price are available to wealth management clients who request them, according to Bloomberg, which reported the news on Thursday citing unnamed sources. Reuters reported that the products have been available for weeks. 

The changes underscore that once crypto-shy brokerage platforms’ are moving to address increasing demand for the ETFs. Earlier this week, CoinDesk reported that Morgan Stanley is contemplating whether to give customers the possibility to invest in the funds. Citigroup and UBS clients already have the ability to buy into the funds. Vanguard Group, the No. 2 ETF issuer whose CEO announced his retirement yesterday, remains among the few holdouts refusing to offer the funds.

 “The big-name issuer marketing teams are gearing up, with the enthusiasm injection that success brings,” former CoinDesk head researcher Noelle Acheson wrote in her Crypto Is Macro Now newsletter earlier this week.

The 10 spot bitcoin ETFs currently available have been surging this week, generating $673 billion in inflows on Wednesday, a single-day record. On Thursday, BlackRock’s iShares Bitcoin Trust (IBIT) became the fastest ETF in history to reach $10 billion in assets under management. These milestones have sent bitcoin’s price soaring to near $64,000 at one point this week, its highest mark since late 2021 when it reached $68,990, according to Coindesk. Bitcoin was recently changing hands at about $61,500.

As of the close of trading Thursday, the ETFs have generated almost $7.5 billion in inflows, despite nearly $8.5 billion in outflows from the Grayscale Bitcoin Trust (GBTC). That product differs from other offerings. GBTC is a conversion from a longer-standing bitcoin trust and charges a 1.5% fee, by far the highest among the 10 new offerings.

$IBIT the newest member of the $10 Billion Club, fastest ever to get there,” Bloomberg senior ETF analyst Eric Balchunas tweeted Friday. “Only 152 ETFs in this club (out of 3,400) incl $GBTC.”

Acheson also wrote that “many investment platforms are still getting set up to offer the ETFs to their clients, and macro funds are still working on their Bitcoin strategy. Why didn’t they do this before the ETFs launched? Because, right up until they actually started trading, it wasn’t clear that they would, and it’s hard to justify spending resources on a “maybe”, especially when other markets are doing so well anyway.”

James Rubin is a contributing editor for etf.com, where he produces the Morning Exchange and Weekly Exchange newsletters. A longtime financial writer, editor and book author, he formerly held positions as a news and markets editor for the Americas at CoinDesk, where he focussed on cryptocurrencies. 

He provided editorial guidance for a Wall Street Journal best-selling book on Bitcoin and oversaw a startup newsroom focused on digital financial assets. He has edited for TheStreet and Unchained, where he wrote daily news stories about the trial of fallen crypto entrepreneur Sam Bankman-Fried. His writing has also appeared in The Hollywood Reporter, Forbes.com, AdWeek, Bankrate, The Financial Brand and The Wall Street Journal. He has also written for Forbes Insights and the Economist Intelligence Unit, including papers presented at World Economic Forums in Davos and Mumbai. 

James is the co-author of The Urban Cyclist’s Survival Guide (Triumph Books) and has been interviewed about bike safety on a number of NPR affiliates. In a prior career, Rubin was a world-ranked tennis player, once competing in Wimbledon’s qualifying rounds. He speaks fluent German and is a graduate of the Columbia University Graduate School of Journalism and received his BA at Columbia University.