Morgan Stanley Weighs Crypto Trading via E-Trade Division

Morgan Stanley is reportedly evaluating plans to introduce cryptocurrency trading through its online brokerage subsidiary, E-Trade, according to sources close to the firm on January 2, 2025. This potential expansion could position the brokerage as one of the largest traditional financial institutions to enter the digital asset trading market.

Will Morgan Stanley Start Crypto Trading via E-Trade Division?

As of now, Morgan Stanley’s E-Trade offers investment in conventional financial securities, including stocks, bonds, and ETFs. However, introducing cryptocurrency trading services is a clear indication that Morgan Stanley is keen on expanding its product line and meeting market demands.

The potential move is being examined as the United States anticipates a friendlier regulatory environment under the Trump administration. The industry has received an encouragement from the President-elect of the United States of America, Donald Trump’s campaign where he vowed to appoint strict pro-crypto officials and even start a bitcoin reserve in the United States.

The acquisition of E-Trade by Morgan Stanley in 2020 at a deal worth $13 billion was to enhance the wealth management business through the use of E-Trade’s many customers. If cryptocurrency trading is integrated, it will create a possibility for millions of customers to engage with the digital asset market directly.

Institutional Momentum in the Crypto Sector

Morgan Stanley’s E-trade action reflects the ongoing trend of institutions developing an interest in cryptocurrencies. Last year, Morgan Stanley started offering its high-net-worth clients access to spot Bitcoin ETFs, which underpin the increasing interest of traditional investors in digital assets.

Other legacy institutions such as Goldman Sachs have also indicated their interest in the crypto market but only if there is a clear policy direction. At the same time, Grayscale and Bitwise have submitted applications for the approval of investing in ETFs that are tied to cryptocurrencies other than Bitcoin and Ethereum.

If E-Trade were to join the direct crypto trading segment, it would rival Coinbase and other companies that currently hold a significant share of the retail trading market.

Global Banking Sector Pushes Further into Crypto

The U.S. is not alone in its embrace of crypto. European financial institutions are also moving into the sector following the implementation of the Markets in Crypto-Assets (MiCA) regulation, which took full effect on December 30, 2024.

Like Morgan Stanley, Spanish banking giant BBVA, through its Turkey-based subsidiary Garanti BBVA Kripto, is preparing to roll out crypto trading services to the public after completing a pilot program. Likewise, Deutsche Bank has also been working on creating blockchain solutions for custody and tokenization with the help of Swiss startup Taurus.

These developments point to a general trend of increased adoption of cryptocurrencies by banks as the regulatory landscape becomes more favorable. “We are in discussions with over 50 institutions that are prepared to launch crypto trading in 2025,” said Abel Peña, the Chief Sales Officer at Bit2Me, a BBVA-associated crypto exchange.