Morgan Stanley has revealed in a filing with the U.S. Securities and Exchange Commission (SEC) that it’s holding $269.9 million worth of Grayscale’s Bitcoin Btrust (GBTC) as of the end of the first quarter.

Bankrupt cryptocurrency lender Genesis, which went under in the wake of the Terra ecosystem’s collapse, won approval for its bankruptcy plan in the United States, with a judge overruling objection from its owner Digital Currency Group (DCG) to approve returning roughly $3 billion in cash and assets to creditors.

The United States House of Representatives is nearing a vote that could bring the cryptocurrency industry closer to achieving long-sought regulation in the country, with key cryptocurrency industry players rallying behind it.

Top stories in the Crypto Roundup today:

• Morgan Stanley Reveals $269.9 Million in Spot Bitcoin ETF Holdings
• Bankrupt Crypto Lender Genesis Approved to Return $3 Billion to Creditors
• Crypto Industry Rallies Behind Upcoming House Vote on FIT21 Act
• ETH Price Slumps to Lowest Level Against Bitcoin Since April 2021

Morgan Stanley Reveals $269.9 Million in Spot Bitcoin ETF Holdings

Morgan Stanley has revealed in a filing with the U.S. Securities and Exchange Commission (SEC) that it’s holding $269.9 million worth of Grayscale’s Bitcoin Btrust (GBTC) as of the end of the first quarter.

The disclosure adds to a growing trend among institutional investors moving into the cryptocurrency space after JPMorgan revealed it held over $730,000 worth of BlackRock’s iShares Bitcoin Trust (IBIT), Bitwise’s BITB, Fidelity’s FBTC, and GBTC in a filing, while Wells Fargo disclosed $141,817 in GBTC holdings. BNP Paribas and BNY Mellon have also made similar disclosures.

These purchases, however, were either made on behalf of these institutions' wealth management clients or were necessary for market making and to facilitate the duties of authorized participants in the exchange-traded funds (ETFs).

Morgan Stanley, it’s worth noting, has opened up spot Bitcoin ETF allocations to clients shortly these funds were approved in January, but on an unsolicited basis, which means clients have to propose the investment to the broker.

Bankrupt Crypto Lender Genesis Approved to Return $3 Billion to Creditors

Bankrupt cryptocurrency lender Genesis, which went under in the wake of the Terra ecosystem’s collapse, won approval for its bankruptcy plan in the United States, with a judge overruling objection from its owner Digital Currency Group (DCG) to approve returning roughly $3 billion in cash and assets to creditors.

Judge Sean Lane of the Southern District of New York rejected arguments from DCG, a creditor group, and the Office of the United States Trustee, paving the way for the plan's implementation.

The plan prioritizes creditor repayment, with Judge Lane noting in his ruling that "DCG has objected to a plan in which it has no economic stake,” adding that there is “not sufficient value in the Debtors’ estates to provide DCG a recovery as equity holder after unsecured creditors are paid."

The complex plan allocates assets based on the type of claim held by creditors. Those owed cryptocurrency will be treated differently than those owed U.S. dollars, with the rising value of cryptocurrencies since the bankruptcy filing meaning creditors holding dollar-denominated claims are expected to be fully repaid, while cryptocurrency creditors may face a shortfall.

While DCG has the option to appeal the ruling, legal experts remain skeptical of their chances given the significant asset deficit. In response to the court’s decision, the Winklevoss twins’ cryptocurrency exchange Gemini released a statement noting Gemini Earn creditors will start receiving their owed assets by the beginning of next month.

Reimbursements will be made in-kind, meaning customers will receive the specific cryptocurrency they deposited, not the dollar value at a specific date.

Crypto Industry Rallies Behind Upcoming House Vote on FIT21 Act

The United States House of Representatives is nearing a vote that could bring the cryptocurrency industry closer to achieving long-sought regulation in the country, with key cryptocurrency industry players rallying behind it.

The Crypto Council for Innovation, a coalition of organizations and firms in the space, including Coinbase, Kraken, Andreessen Horowitz, and the Digital Currency Group, alongside 50 others, have penned a letter to Speaker of the House Mike Johnson (R-La.) and Minority Leader Hakeem Jeffries (D-N.Y.), advocating for the passage of the Financial Innovation and Technology for the 21st Century Act (FIT21).

This legislation, which proposes the Commodity Futures Trading Commission (CFTC) as the leading regulator for digital assets and sets clear responsibilities for it and the SEC,  is scheduled for floor time next week.

The bill also aims to establish consumer protections, which would include rules on the custody of users’ digital assets and their treatment in bankruptcy, while also implementing safeguards against risky practices.

Last week, lawmakers in the country voted to pass a joint resolution aiming to overturn a Securities and Exchange Commission (SEC) rule affecting financial institutions doing business with cryptocurrency firms.

The resolution previously cleared the U.S. House of Representatives and now faces a potential veto from President Joe Biden, who said he planned on vetoing the bill after expressing concerns about investor protection and the stability of the broader financial system.

As the bill advances to the floor, the House Rules Committee has called for a range of amendments to be submitted by May 16.

ETH Price Slumps to Lowest Level Against Bitcoin Since April 2021

The price of Ethereum, the second-largest cryptocurrency by market captalization has been falling behind Bitcoin this year. The ratio between Ethereum and Bitcoin (ETH-BTC) has reached 0.044, which is the lowest it's been since April 2021.

State of the Crypto by Top Tier Exchange Volume

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