Wall Street giant Morgan Stanley has encouraged investors to consider allocating between 2% and 4% of their portfolios to cryptocurrencies. The bank’s latest recommendation marks a notable shift in Wall Street’s tone toward digital assets, with Bitcoin taking the spotlight as a limited-supply asset often compared to gold in digital form.
The bank’s Global Investment Committee (GIC) released new portfolio allocation recommendations on October 5. According to the guidelines, portfolios focused on “opportunistic growth” could hold as much as 4% in crypto.
Hunter Horsley, CEO of Bitwise, called the move a milestone moment for the crypto asset industry. He noted that the GIC report was designed to help Morgan Stanley’s network of 16,000 financial advisors manage over $2 trillion in client wealth with updated guidance on including crypto. Horsley added that the firm’s endorsement shows how digital currencies are moving further into the mainstream investment world.
The announcement sparked mixed reactions within the cryptocurrency community on X (formerly Twitter). Some investors applauded the recommendation as a strong show of confidence from a major financial player, while others dismissed it as a modest step that arrived later than expected.
For investors with “balanced growth” goals, the bank suggested a more conservative 2% crypto allocation. However, it remained cautious for clients focused on “income” or “wealth preservation” portfolios, advising no exposure to digital assets for these groups.
The GIC report also noted that exchange-traded products (ETPs) are becoming a practical entry point for investors who prefer a regulated alternative to direct cryptocurrency ownership. This structured access offers traditional investors a safer way to participate in the expanding world of digital assets without holding the tokens themselves.
The report follows Morgan Stanley’s earlier decision in September 2025 to introduce cryptocurrency trading on its E-Trade platform through a collaboration with Zerohash. A company representative confirmed that users would initially have access to trading Ether, Solana, and Bitcoin.
It also comes as Bitcoin (BTC) continues to gain traction among institutional and retail investors alike. The digital asset recently crossed the $125,000 threshold, surpassing its August peak of $124,500. Meanwhile, centralized exchanges have reported the lowest BTC reserves in six years, indicating reduced supply as market demand strengthens.
Morgan Stanley’s measured approach reflects a growing acknowledgment of crypto’s potential among major financial players. By suggesting modest portfolio exposure, the bank recognizes the appeal of digital assets while maintaining awareness of their volatility.
As BTC reserves on centralized exchanges dwindle, investor interest is likely to be diverted towards crypto-accumulation platforms like American Bitcoin Corp. (NASDAQ: ABTC) in a bid to include digital assets in their portfolios.
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