Bitcoin News Today: Morgan Stanley's Digital Gold Mandate Fuels Bitcoin's $125K Surge

Bitcoin reached a historic milestone on October 6, 2025, surging past $125,000, a new all-time high, as market dynamics and institutional adoption converged to drive the cryptocurrency's value. Centralized exchange balances for Bitcoin hit a six-year low, according to data from Glassnode, signaling a tightening supply as investors increasingly shift holdings to private storageMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1]. The price rally occurred amid a U.S. government shutdown and a rebound in inflation, with analysts noting a broad rush into asset classes as macroeconomic pressures intensifiedMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1].

Morgan Stanley's Global Investment Committee (GIC) released guidance recommending 2% to 4% crypto allocations for client portfolios, depending on risk profiles, aligning with the asset's recent price trajectory. The bank categorized Bitcoin as a "scarce asset, akin to digital gold" and positioned it within the broader category of real assetsMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1]. For "Opportunistic Growth" portfolios, the GIC suggested a maximum 4% allocation, while "Balanced Growth" portfolios were advised to cap exposure at 2%. Portfolios focused on wealth preservation received a 0% allocation recommendationMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1]. The guidance, applicable to 16,000 Morgan Stanley advisors managing $2 trillion in client assets, emphasized regular rebalancing-quarterly or annual-to prevent crypto positions from exceeding risk thresholds as prices fluctuateMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1].

The report acknowledged Bitcoin's maturity as an asset class, citing its outsized returns and declining volatility over recent years. However, it warned of heightened volatility during economic stress and potential increased correlations with other asset classes during market turbulenceMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1]. Morgan Stanley's Bitwise CEO, Hunter Horsley, described the guidance as "huge," stating it marked crypto's entry into the mainstream eraMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1]. The bank also highlighted exchange-traded products as regulated pathways for crypto exposure, avoiding direct token purchasesMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1].

Technical indicators reinforced Bitcoin's bullish momentum. Exchange reserves, a proxy for liquidity, fell to their lowest levels since 2019, suggesting reduced availability for trading and heightened investor confidence in long-term holdingMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1]. The price surge followed a previous peak of $124,500 in August, with analysts attributing the rally to a combination of speculative demand and institutional adoptionMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1]. Morgan Stanley's analysis underscored the growing role of crypto in diversified portfolios, even as it maintained a cautious stance on unregulated direct holdingsMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1].

The bank's strategic expansion into crypto services further solidified its position in the digital asset space. Morgan Stanley plans to launch crypto trading for E-Trade clients in early 2026 through a partnership with infrastructure firm Zerohash, aiming to provide custody, liquidity, and settlement servicesMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1]. This move, one of the largest by a U.S. bank into digital assets, reflects a broader industry shift as Wall Street firms increasingly integrate crypto into traditional financial frameworksMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1].

Bitcoin's ascent to $125,000 and Morgan Stanley's allocation guidance highlight a maturing market where institutional credibility and regulatory clarity are reshaping perceptions. While volatility remains a key concern, the tightening supply backdrop and growing acceptance among major financial institutions suggest continued momentum for the asset class in the near termMorgan Stanley Advises 2% to 4% Crypto Allocation for Client Portfolios^[1].