Financial advisors at Merrill Lynch have been formally banned from pushing bitcoin-related investments for their clients, according to reports.
Under the terms of the ban, Merrill’s approximately 17,000 advisors can not pitch bitcoin-related investments. Merrill advisors are further banned from executing client requests to trade Grayscale’s bitcoin investment trust (GBTC).
“The decision to close GBTC to new purchases is driven by concerns pertaining to suitability and eligibility standards of this product,” according to an internal memo reviewed by The Wall Street Journal.
Merrill Lynch has since confirmed the decision through a spokesperson.
GBTC is traded “over the counter,” as opposed to in a venue like the NYSE. The trust is a top holding for two of Ark Invest’s exchange-traded funds (ETFs), according to reports. Given bitcoin’s extraordinary performance, GBTC was one of the top-performing ETFs in 2016, according to data out of ETF.com.
The latest from Merrill is in line with prior actions — the firm had previously banned access to bitcoin futures via the CME, the world’s largest futures exchange, and its competitor Cboe.
Despite the reticence of players like Merrill, not to mention an increasingly loud chorus of international regulators, bitcoin has seen its price rise more than 1,300 percent over the last 12 months. This has lead boosters to crow that bitcoin is coming into its own — and critics to mumble about tulips and bubbles.
Bitcoin, as of pre-market trading on Jan. 4, hovered around $14,000 per unit.
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