Morgan Stanley, the $1.7 trillion Wall Street giant, is preparing to make a landmark move into the cryptocurrency space by enabling spot trading of digital assets for retail investors via its E*Trade platform.
According to a Bloomberg report citing anonymous sources, the bank plans to roll out this feature in 2026, marking the most significant entry into direct crypto trading by a major U.S. financial institution.
Currently, ETrade clients can only access crypto indirectly through ETFs, futures, and trust products. The upcoming upgrade will allow them to buy and sell actual crypto assets, a development that would put ETrade in direct competition with platforms like Robinhood and Coinbase.
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This initiative follows a shift in U.S. government policy, as the Trump administration eases regulatory restrictions on digital assets. Since assuming office, President Trump, together with various federal agencies and Congress, have initiated several actions that have the potential to reshape the digital asset industry within the United States. Recall that on January 23, 2025, Trump issued an executive order that reverses key elements of a Biden-era federal policy framework that emphasized strict oversight, enforcement actions, and consumer protection warnings.
It is worth noting that Internal discussions at Morgan Stanley reportedly began in late 2024 after the administration reversed several measures aimed at curbing crypto-related risk, creating a more favorable environment for institutional participation in the space.
The new feature is still in early development, but it’s gaining momentum as Morgan Stanley seeks to meet rising client demand for crypto access. The firm plans to partner with established crypto infrastructure providers to handle custody, fiat conversions, and other backend services ensuring scalability and security for its users.
Morgan Stanley’s E*Trade, acquired in 2020 for $13 billion, serves over 5 million retail clients and has established itself as a leading platform for online brokerage, trading, and workplace wealth solutions. By integrating crypto spot trading, the platform will not only enhance its offering but also strengthen its position in a rapidly evolving financial landscape where digital assets are gaining mainstream traction.
Competitive Landscape
The initiative places E*TRADE in direct competition with Robinhood, which reported $626 million in crypto revenue in 2024, and Coinbase, with $1.2 billion in Q3 2024 trading revenue. Morgan Stanley’s trusted brand and regulatory oversight could attract investors seeking a secure, mainstream platform, potentially drawing market share from crypto-native exchanges.
Unlike Coinbase, which offers a broad range of tokens, E*TRADE is likely to focus initially on major cryptocurrencies like Bitcoin and Ethereum, similar to competitors like Robinhood and Fidelity. This could limit its immediate threat to exchanges specializing in altcoins but still erode market share for mainstream assets.
Morgan Stanley move to launch Spot Crypto Trading on E*Trade Platform, aligns with global trends, as European banks like BBVA and Deutsche Bank expand crypto offerings under MiCA regulations. This could spur other traditional brokers, like Charles Schwab and SoFi, to accelerate their crypto plans, amplifying competitive pressure.
This development comes at a pivotal time, with Bitcoin trading above $96,000 and spot Bitcoin ETFs attracting billions in institutional inflows. If successful, E*Trade could become a regulated and trusted gateway for retail investors to gain direct exposure to Bitcoin and other cryptocurrencies, potentially reshaping the competitive dynamics of crypto trading in the U.S. financial sector.
Looking Ahead
Morgan Stanley’s E*TRADE crypto trading initiative will intensify competition for crypto platforms, by leveraging its trusted brand, regulatory compliance, and vast client base. While posing challenges like market share erosion and pricing pressure, it also drives mainstream adoption and market growth, benefiting the broader ecosystem.
Morgan Stanley is planning to offer clients a way to buy and sell cryptocurrency on its E* Trade platform, Bloomberg reports, citing anonymous sources. The move, to launch next year, would be the biggest yet by a major U.S. bank into offering spot trading of the asset class — and put Morgan in competition with platforms such as Robinhood. It follows a softening of opposition to crypto as the Trump administration rolls back regulations intended to guard against risk in the volatile digital coin sector.