Morgan Stanley to Launch Crypto Trading on E*Trade Platform Next Year

Morgan Stanley is set to introduce crypto trading on its E*Trade platform, marking a pivotal step for a major U.S. bank to bring digital assets to retail investors. The initiative, slated for launch in 2026, follows a significant easing of regulatory restrictions under the Trump administration, which has spurred traditional financial institutions to explore crypto. This move positions Morgan Stanley to compete with platforms like Robinhood, which have long offered crypto trading to their users.

The plan according to Bloomberg is still in its early stages, with Morgan Stanley executives considering partnerships with established crypto firms to facilitate trading of popular tokens such as Bitcoin and Ethereum. Discussions within the firm gained traction late last year, driven by a shifting regulatory landscape and growing client interest. Wealthy Morgan Stanley clients already have access to crypto exchange-traded funds, ETF options, and futures, but the addition of spot trading on E*Trade targets a broader retail audience. The decision reflects a strategic effort to capture a share of the rapidly growing digital asset market.

A New Era for Crypto in U.S. Banking

Discussions within the firm gained traction in January this year before Trump was officially took office. Now, the push into crypto trading comes amid a dramatic policy shift in the United States. President Donald Trump, who campaigned on making the U.S. the “crypto capital of the planet,” has taken swift action to dismantle regulatory barriers since taking office. Days after his inauguration, Trump issued an executive order promoting innovation in digital assets, while the Securities and Exchange Commission repealed accounting rules that had hindered crypto firms’ ability to collaborate with banks. The Federal Reserve and the Federal Deposit Insurance Corporation also withdrew 2023 guidance that had cautioned banks about crypto-related risks, earning praise from the Bank Policy Institute.

These changes have emboldened major financial institutions to rethink their cautious stance on cryptocurrencies. Morgan Stanley, under the leadership of former CEO James Gorman, has shown early interest in the sector, with Gorman describing Bitcoin as “more than just a fad” in 2017. The firm’s decision to expand crypto offerings on E*Trade aligns with a broader trend, as competitors like Charles Schwab and SoFi Technologies also signal plans to re-enter or expand in the crypto space. Schwab’s CEO, Rick Wurster, recently confirmed the firm’s interest in spot crypto trading, while SoFi is exploring a return to crypto investing after exiting the market in 2023.

The competitive landscape is heating up, with platforms like Robinhood setting a high bar. Robinhood’s crypto trading business generated $626 million in 2024, accounting for 21% of its total net revenue, and the firm reported a doubling of first-quarter profits this year amid increased trading activity. Morgan Stanley’s entry into this space could challenge such platforms by leveraging E*Trade’s established user base and the firm’s reputation for reliable financial services. The move also underscores the growing mainstream acceptance of cryptocurrencies as an asset class.