Goldman Sachs, Morgan Stanley took stakes in US spot bitcoin ETFs in Q2, filings show

by Suzanne McGee

(Reuters) – Goldman Sachs and Morgan Stanley purchased a combined total of more than $600 million of spot bitcoin exchange-traded funds (ETFs) in the second quarter, regulatory filings showed on Wednesday.

The two banks join a group of hedge funds and financial advisors investing in the products, which start trading in January 2024.

Goldman Sachs reported in a quarterly filing with the Securities and Exchange Commission, known as File 13-F, that it raised about $418 million from recently launched ETFs tied to the spot bitcoin price.

The bulk of that amount reflected about 7 million shares in the iShares Bitcoin Trust, which was valued at about $238 million as of the quarter-end on June 30. Goldman also took significant stakes in the Fidelity Wise Origin Bitcoin ETF and the Invesco Galaxy Bitcoin ETF, and smaller positions in several other bitcoin ETFs that launched in January.

Morgan Stanley also backed BlackRock’s iShares bitcoin ETF, disclosing 5.5 million shares worth $188 million as of June 30. The bank also disclosed smaller stakes in the Ark 21Shares Bitcoin ETF and the Grayscale Bitcoin Trust.

13F filings are one of the few ways to get a snapshot of how institutional investors are positioned at the end of each quarter. Positions do not necessarily reveal current holdings.

While recent filings show the range of institutions in bitcoin ETFs is increasing, ETF issuers and analysts say the products have so far been dominated by retail investors.

Neither bank could be reached for comment on whether the positions were taken on behalf of clients or for each firm’s own account.

Some hedge funds that had established positions in Bitcoin ETFs earlier this year adjusted their positions during the second quarter, according to the filings.

New York-based Hunting Hill Global Capital has reduced its investment in Grayscale and Fidelity ETFs but held an $18.32 million stake in the Bitwise Bitcoin ETF as of June 30 and a new $25.6 million position in BlackRock’s ETF.

Hunting Hill founder and CEO Adam Guren said his company is an active trader of bitcoin products. “At any given time, our trading activity may change and therefore our positions may change,” he said.

New York-based Millennium Management LLC said it reduced its positions in three of its five Bitcoin ETFs in the first quarter, kept its position in the Ark 21Shares ETF unchanged and increased its stake in Bitwise to about 2 million shares from about 1.2 million shares at the end of the first quarter.

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Overall, the hedge fund had about $1.15 billion invested in bitcoin ETFs at the end of the second quarter, less than the $2 billion it disclosed at the end of the first quarter. A spokesperson for the company declined to comment.

Bitcoin’s price fell 12% in the quarter.

(Reporting by Suzanne McGee; Editing by Ira Iosebashvili and Leslie Adler)